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FOREST SECTOR CHARTER COUNCIL

This confidential presentation provides an outline of the Forest Sector, Forest Sector Charter, Forest Sector Charter Council, and the business plan priorities for FY2014/15.

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FOREST SECTOR CHARTER COUNCIL

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  1. FOREST SECTOR CHARTER COUNCIL PORTFOLIO COMMITTEE 4 NOVEMBER 2014 MR PASCO DYANI (CHAIRPERSON) CONFIDENTIAL

  2. PRESENTATION OUTLINE • Forest Sector • Forest Sector Charter • Forest Sector Charter Council • FY2012/13 B-BBEE Status report • FY2014/15 Business Plan- Priorities CONFIDENTIAL

  3. Forest Sector • Uses 1% of total land (1 273 357ha) • Employs about 146 000 in sawmilling, pulp & paper, timber boards, mining timber etc., (22.5% employment in Agriculture) • Provides about 850 000 livelihood support • Contributes 1% National GDP & 7.7% of manufacturing GDP • Production mainly on pulp & paper and sawmilling products • Derives 70%of revenue from exports (Information gathered from FSA Facts 2011/12) CONFIDENTIAL

  4. Forest Sector Charter • Originates from the B-BBEE Act, No 53 of 2003 • Launched in 2005, established a Steering Committee • 2005-2008 draft Charter developed by working groups & Steering Committee • FB-BBEE draft Charter gazetted for public comments in May 2008 • Published as a Sector Code in June 2009 CONFIDENTIAL

  5. Forest Sector Charter (cont) • Main objective: “To extend economic opportunities and benefits of Forest Sector to the previously disadvantaged black groups”. • Scope of application • Growers • Contracting • Fibre • Sawmilling • Pole & • Charcoal sub- sectors CONFIDENTIAL

  6. Forest Sector Charter Council (FSCC) • FSCC known as “Council” was launched in May 2008 & operating as a section 21 Company. • Main responsibilities: - To facilitate, oversee, encourage implementation of Charter - To monitor & report on the Charter Undertakings - To monitor & report on the Status report - To publicize the Charter & - Participates in Government, Industry & Council forums & member of the Joint Technical Team (Dti initiative) CONFIDENTIAL

  7. Forest Sector Charter Council (cont) • 3 strategic sessions, highlighting strategic objectives. • Foresight exercise in 2011 to craft preferred future for sector • Quarterly meetings on a annual basis. • Reporting: • The President’ B-BBEE Advisory Council, • Minister of Trade & Industry & • Minister of Agriculture, Forestry & Fisheries. • Composition – 20 Board members & an Independent Chairperson CONFIDENTIAL

  8. FY2012/13 B-BBEE Status • FY2012/13B-BBEE Status • An annual progress report on scorecard implementation • Fourth (4th) B-BBEE Status report • Sector Level 5 status, a level decline from previous year • Qualifying small enterprises (QSE) achieved level 3 • Exempted Micro Enterprises(EME) level 4 achieved CONFIDENTIAL

  9. FY2012/13 B-BBEE Status • FY2012/13 B-BBEE report (Cont): • Sector performing well in Socio-Economic Development (SED), Enterprise Development (ED), Preferential Procurement (PP) • Average performance in Ownership (O) • Poor performance in Management Control (MC), Employment Equity (EE) & Skills Development (SD) CONFIDENTIAL

  10. FY2014/15 Business Plan- Priorities • Charter Review Process • According to section 16.2(c) of the Forest Code, • Mandates Council to conduct an comprehensive review, • Review to identify achievements and shortcomings, & assess if any adjustments are required. • Charter Review Expected outcomes: Comprehensive report underlining: • Key issues & findings based on objectives of review process, CONFIDENTIAL

  11. FY2014/15 Business Plan- Priorities • Charter Review Expected outcomes: • Comprehensive report underlining: • Highlight of achievements, failures, modifications & adjustments required, • Obstacles and challenges to meaning implementation, and • Strategic & actionable recommendations, • Possible alternatives for effective B-BBEE implementation, monitoring & reporting. CONFIDENTIAL

  12. FY2014/15 Business Plan- Priorities • Charter Review – Progress: • Undertaken by a Service Provider, • Managed by an established steering committee (Council and Service provider), • Stakeholder consultations undertaken, • Preliminary findings discussed by Steering Committee, • Steering Committee adopted report end of September CONFIDENTIAL

  13. FY2014/15 Business Plan- Priorities • Charter Review Preliminary Findings • Relevancy of Forest Code, • Lifespan of Forest Sector Code, • Mandate of Council ( Non compliance), • Representation in the Council, • Awareness in terms of the Code & the Council CONFIDENTIAL

  14. FY2014/15 Business Plan- Priorities • Realignment Process: • Dti Amended B-BBEE Act (Act still to be pronounced) • Dti gazetted the Revised Codes of Good Practice (CoGP, Vol: 580, No. 36928), ( the basis for all Sector Specific Codes • Sector Councils to align Sector Codes with Amended CoGP • Realignment Process expected outcome: • Revised Forest Sector Code CONFIDENTIAL

  15. FY2014/15 Business Plan- Priorities • Realignment Process objective: • To align Forest Code with Revised Codes of Good Practice & B-BBEE Amendment Act • Realignment Process- Progress: • Council & Constituencies began negotiations in July • Scorecard on Ownership (O), Management Control (MC), Skills Development (SD) & Socio Economic Development (SED) adopted CONFIDENTIAL

  16. FY2014/15 Business Plan- Priorities • Realignment Process- Progress (Cont): • First draft devoid of ESD element reviewed by Council and stakeholders; • Final revised draft to be adopted end November • Final revised draft to be sent to Dti for 60 days public comment • Anticipated date of adoption before Transitional period end in April 2015 • Gazetted Revised Forest Sector Code - 1st May 2015. CONFIDENTIAL

  17. FY2014/15 Business Plan- Priorities • FY2013-14 B-BBEE Status report: • An annual progress report on scorecard implementation • Fifth (5th) report • Analyse level of compliance within the 0- 5 year targets • Objective: • Assess the status of transformation in the Forest sector CONFIDENTIAL

  18. FY2014/15 Business Plan- Priorities • FY 2013-14 Status report – Progress: • Undertaken by Service provider • Managed by a steering committee • Preliminary report discussed by Steer com end of September • Preliminary report suggest sector a level 4 • Final report to be presented to Council end of November CONFIDENTIAL

  19. FY2014/15 Business Plan-Budget • Budgetary Implication: • Funding by 60% Government , 40% Industry • Total budget : R8 506 095.00 CONFIDENTIAL

  20. THANK YOU CONFIDENTIAL

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