Transformation Charter for the Construction Sector Presentation to the Portfolio Committee

1. Transformation Charter for the Construction Sector Presentation to the Portfolio Committee 14 September 2005

2. The Process (1) • Process Initiation • Process initiated in July 2004 • All construction sector stakeholders invited to participate • Launched by Minister Sigcau in October 2004 • Management of the process • Integrated Management Committee • Government led by National Department of Public Works • Labour: NUM and BACCAU • Business: 13 associations [established business, black business (NAFBI, NABCAT), women – SAWIC, Women for Housing] • Technical Committees: constituted by all stakeholders

3. The Process (2) • Engagement with stakeholders • Integrated Management Committee – engaging with the different stakeholders through the mandated representatives in the IMC • Provincial road shows (Feb & Mar 05) targeted at labour, contractors, public sector, & all CI stakeholders • Construction Charter Indaba (April 05)

4. The Process (3) • Engagement with stakeholders (cont) • Parliamentary Briefing (May 05) • Workshops with Black business & Women business • Public Sector Workshop (June 05) • Various informal engagement between stakeholders • Parliamentary briefing (Sept 05)

5. The Process (4) • Charter development process • Charter Framework – lays a foundation for the charter and a vision for the sector for the next 7 years • Technical Committees – research & proposals on the charter • Scorecard – weightings and targets across all elements • Sign off – once all stakeholders have agreed

6. The Charter Framework • Preamble • Status quo of the construction sector • Commitment of stakeholders to the charter • Application and reporting • Components of the scorecard • Definitions • Scorecard

7. The Scorecard - 1(Elements) • Direct Empowerment • Ownership • Control • Management • HRD • Employment Equity • Skills Development (training, learnerships, bursaries, mentorship)

8. The Scorecard - 2(Elements) • Preferential Procurement • Enterprise Development • Residual • CSI • Other

9. The Scorecard - 3(Weightings - %)

10. Targets • Negotiations finalised on 13th Sept 2005 • Have achieved the ownership target challenge • Certain targets bracketed for the BEPs • (Economic interest to which designated groups are entitled,% of black people in junior management, Learnerships as a percentage of total employees)

11. Way Forward - 1 • Finalization of the text (the framework) • Issue of interim 4 year targets • Investigation into the set up of the charter council (representation, funding, etc) • Sign off of draft Charter by all stakeholders • Charter handover to Minister of Public Works

12. Way Forward - 2 • Charter submission to Minister (DTI) (if Minister Public Works is satisfied with the proposals of the charter. If not satisfied, Charter will go back for redrafting and negotiations) Gazetting of draft Charter by DTI • Submission to Cabinet by DTI • Effective date: 31 December 2005

13. Observations (1) • A very long, intense process but worthy • Proposal of draft charter in line with BBBEE Act [section 12 (a) to (g)] • Consultation • voting rights, economic entitlement, net economic interest • Women participation • Designated groups participation

14. Observations (2) • Commitment to racial transformation within the sector: • Ownership • Control • Management • Commitment to the growth & development of the sector and enhancing skills base • Employment equity • Skills development • Procurement • Enterprise development

15. Transformation Charter for the Construction Sector Presentation to the Portfolio Committee Construction Industry Policy Unit 14 September 2005