PRESENTATION TO THE PRESIDENTIAL BBBEE Advisory Council

[16 July 2013]

“TRANSFORMATION AND DEVELOPMENT LEVELS IN THE CONSTRUCTION SECTOR”

Thabo Masombuka Chief Executive Officer (CEO)

INDEX

1. WHY THE CONSTRUCTION SECTOR CODE (CSC).

2. THE ROLE OF THE CSCC.

3. THE NEW MEASUREMENT TARGETS .

4. PRACTICE NOTES AND ROAD SHOWS .

5. BASELINE PROJECT AND EXPECTATIONS.

6. ALIGNMENT PROCESS.

7. INDUSTRY EMPOWERMENT INITIATIVES.

8. COLLABORATION WITH THE CIDB.

WHY THE CONSTRUCTION SECTOR CODE (CSC)

THE CSC WAS GAZETTED TO FACILITATE :

• The inclusion of BLACK WOMEN IN THE OWNERSHIP and MANAGEMENT of construction companies and businesses.

• The acceleration of TECHNICAL SKILLS and CAPACITY OF BLACK YOUTHS and THE DISABLED and provide JOBS and EMPLOYMENT OPPORTUNITIES.

 • Building the ENTREPENEURIAL CAPACITY and SUSTAINABILITY OF BLACK

enterprises in the construction sector.  • An enabling environment FOR ECONOMIC GROWTH and Construction

sector characterized by INCLUSIVITY.

WHY THE CONSTRUCTION SECTOR CODE (CSC)

IT ALSO SET OUT TRANSFORMATION OBJECTIVES in the construction industry:

• SUBSTANTIAL change in racial and gender composition of ownership, control and management.

• PROMOTE effective advancement of employment equity.

• QUANTITATIVE measurement of monitoring of BBBEE progress.

• ACCELERATING advancement of skills development for black people, black women and the disabled.

• INCREASE procurement opportunities from Black Owned companies

• DEVELOP and enhance entrepreneurial culture for sustainable development.

ROLE OF THE CSCC • The CSCC was registered as an NPO in October 2012 following the gazette.

• Entrusted with OVERSEEING and MONITORING the IMPLEMENTATION of the Construction Codes of Good Practice by the Industry.

• Through various industry programmes, responsible for the FACILITATION of the achievements of sector empowerment TARGETS.

• Empowered to act with executive AUTHORITY in providing necessary GUIDANCE on how to implement the Construction Sector Code.

• LIAISON with and reporting to the regulatory stakeholders on the annual measurement of the construction sector code - BBBEE Advisory, DPW and the DTI .

• Creation of RELIABLE and ACCURATE industry specific empowerment data

ROLE OF THE CSCC • Made up of construction industry 17 mandated representatives from :

• Government (The DPW) • Emerging Contractors (NABCAT, NAFCON & SAWIC) • Built Environmental Professionals (BEPs)

SAIA CESA

• Labour (BCAWU & NUM) • Established Business

MBSA SAFCEC

• Founding constitution – The Chairperson has to be appointed by the Minister of Public Works - Still waiting for the appointment.

• CSCC is responsible for the MONITORING of the Measurement Targets.

• In order to ensure continual progress on transformation within the sector, the CSC was gazetted with two measurement periods.

• The implications is that for the second measurement period targets on Employment Equity, Management Control and Preferential Procurement have increased significantly .

The two periods in question are : 

First measurement period

0 – 4 years ( 5 June 2009 – 5 June 2013)

Second measurement period

5 – 7 years (6 June 2013 – 5 June 2017)

ROLE OF THE CSCC

PRACTICE NOTES AND ROADSHOWS

Since the gazette of the CSC in 2009, the CSCC has developed the following :

Practice notes for guidance of the public sector institutions covered by the scope of the CSC.

Joint programme of the CSCC and the DPW.

To create awareness about the existence of the CSC and enhance capacity in the understanding and implementation of the CSC.

Roadshows and communication advocacy programmes are planned.

Private sector advocacy with the suppliers and manufacturers planned.

BASELINE PROJECT

CSCC is in the process to finalize the BASELINE report on the status of BBBEE in the construction sector since the gazette in JUNE 2009.

This is NEEDED to ensure the following :

• Reliable data and information to verify whether there has been progress data in empowerment in the Construction sector.

• Engagement with the regulators on areas of alignment with the new/revised BBBEE codes based on factual data in the sector.

• FACTUAL and SUBSTANTIVE annual reporting to the dti and the BBBEE advisory council.

• To identify & investigate transformation BARRIERS AND EFFECT RECTIFICATION.

BASELINE PROJECT

In order to ensure reporting to the dti and alignment with the revised BBBEE codes, the BASELINE STUDY must be complete by the end of July 2013.

• Letters already communicated to industry associations.

• Direct liaison will be made to measured entities requesting scorecards.

• Engagements with Verification Agencies, Registered Auditors and SANAS are ongoing.

• Certificates and scorecards are to be sent scorecard@cscc.org.za

• Communication is made via different channels

• To ensure that there is MAXIMUM IMPLEMENTATION of identified trends.

Dti PROPOSED TIMELINES FOR ALIGNMENT PROCESS

Analysis of the BBBE Codes > discussion & consultation

Drafting of aligned Sector Codes

Consultation with sector members on draft

Incorporation and submission to Trade Minister for gazette

Final gazette of codes

July 2013

July – August 2013

October – December 2013

By June 2014

ALIGNMENT PROCESS

• Initially envisaged to be finalized by June 2013• The Minister is yet to gazette and publish the final version of the Codes. • Within three (3) months • On gazette and publishing, all Sector Codes will have to commence with the

process of alignment. TWELVE months permissible for alignment.• Total member agreement necessary on any changes, as per CSCC constitution

WHAT ALIGNMENT ACTUALLY MEANS :

• Ensuring that PRINCIPLES and MEASUREMENT methodologies are the same. • Deviations allowed only on certain PROVISIONS, TARGETS and WEIGHTINGS• No deviations THRESHOLDS (unless justified), Enhanced status and the

priority elements.• No redefinition of beneficiaries on priority elements • Sector codes must include own targets for ESD elements.

INDUSTRY EMPOWERMENT INITIATIVES (Examples)

Career and Enterprise Development opportunities, primarily for women, in the construction industry.

• Khuthaza facilitates transformation of black women, we aim for quality not just numbers through various industry involvement in our programmes.

Talent Development

• Students, professionals and business leaders• Currently focused on support for university students and

young professionals

INDUSTRY EMPOWERMENT INITIATIVES

Enterprise Development

• Offer 3 levels of 8-month Contractor Development programmes, workshops, industry linkages.

• Facilitate individual ED relationship programmes on behalf of established sector.

• Facilitate access to BEE info and other industry ED opportunities.

Bridgebuilding • Advocacy, facilitation, integration across industry,

information sharing• Working more and more closely with established sector to

provide support and increase opportunities

INDUSTRY EMPOWERMENT INITIATIVES examples

ED PROGRAMME FOR Bentel Associates International, an architecture firm. • Ubuhlebethu - a 100% women owned construction company, a family

run business, has been the beneficiary of Bentel’s support in the past year.

• Support has focussed on their needs and interests: business growth, contractual training (JBCC), various types of training for staff, accessing business finance, linkages to industry contacts. Their COO completed all 3 levels of Khuthaza programmes 2009-2011.

• Upgraded to CIDB GB7 and CE7 in 2012. Turnover now above R35 million but were giving back and supporting transformation themselves through Khuthaza (and on own): employing young female professionals, offering contractors in Khuthaza programmes opportunities to visit sites and subcontract.

COLLABORATION WITH THE CIDB

JOINT NSF TASK TEAM◦ Review Discussion Paper providing an assessment of the

effectiveness of the Construction Charter in enhancing transformation in the Construction Industry including:

An overview of current systems for monitoring the CSC role players; and

An assessment of gaps and needs. Assessment of the effectiveness of the CSCC

Target date for endorsement of the Discussion Paper is March 2014

The CSCC is based at :

164 Katherine DrivePinmill Farm Office Park Ground Floor – G Block

TEL : (011) 262 4644

www.cscc.org.za

WHERE TO FIND US