Construction Sector Codes Finally Gazetted

Compliments of the New Season to all our members and readers. We trust you all had a safe and restful Festive Season; and that you are ready with renewed vigour and energy to deal with the head winds that we foresee will still be with us for the foreseeable future in line with the ‘new normal’ VUCA (Volatile, Uncertain, Complex, and Ambiguous) world we are now living in as alluded to in my President’s Comment in the December 2017 edition of SA Builder.

Bafikile Bonke Simelane, President, Master Builders South Africa

Notwithstanding the above, it is with great relief and excitement that we welcome the gazetting of the Construction Sector Charter by the Minister of Trade and Industry. Our Sector Charter was gazetted on 01 December 2017. We at Master Builders South Africa, as a strong supportive partner of the Construction Sector Charter Council (CSSC), truly believe that this heralds a new era for transformation and empowerment.

We urge all our members as well as all other interested and affected parties to familiarise themselves with the new Codes which are very different from the preceding Generic Codes in many ways – with specific reference to the treatment of Exempt Micro enterprises (EMEs), Qualifying Small Enterprises (QSEs), Black-Owned and Black-Woman Owned businesses, amongst other salient features, including elements of Skills Development and Management Control.

It is also very important to note the interpretation and definition of Empowering Supplier with specific reference to full and complete compliance with the prevailing provisions of the Employment Equity Act including accurate and timeous submission to the Department of Labour, before the end this month, of Workplace Skills Plans (WSPs) and Annual Training Reports (ATR’s) by designated Employers. Non-compliance with Empowering Supplier provisions will have disastrous consequences for your BBBEE.

We are also encouraged to read that Business Confidence in South Africa was up slightly in November 2017, reflecting an anticipation of more conducive economic conditions according to a report by the South African Chamber of Commerce and Industry (SACCI). The report states that South African businesses have taken heart from the fact that the country still had an investment grade sovereign credit rating from Moody’s, despite falling into “junk” status with its peers S&P Global and Fitch.

According to Stats SA, South Africa’s economy grew more than expected in the third quarter as the agricultural sector continued to recover from a severe drought while mining and finance also improved, lifting hopes the country may avoid further credit downgrades. Whereas the Absa Purchasing Managers’ Index (PMI) still trended below the neutral level of 50 for the sixth consecutive month during November, it has consistently shown improvement for four successive months from August to November.

Whilst “one swallow does not make a summer,” it is nevertheless a source of encouragement and optimism for the metals and engineering sector since the index, which is a lead indicator, provides insight into the views and sentiments of producers and relevant stakeholders in the manufacturing sector. This is a key component of the construction economy value-chain especially against the background of Quarter 3 job losses of around 145 000 by the construction sector as reported by the Construction Industry Development Board (CIDB).

Tough trading conditions exacerbated by macro-economic conditions, sluggish growth, lack of continuity of work, margin pressure continue to cause the sector and our members much distress despite some of the good news referred to above. It is impossible to see how further job losses are going to be avoided.

We therefore look forward once again to next month’s State of the Nation Address (SoNA) by the State President and subsequent Budget Speech by the Minister of Finance for a package of specific and targeted measures designed to kick-start and stimulate the economy to stave off the risk of further ratings downgrades; and build confidence in the resilience of our economy to attract Foreign Direct Investment through infrastructure investment amongst other considerations despite other fiscal constraints brought about by below-target revenue collections by SARS.

Bafikile Bonke Simelane

President, Master Builders South Africa

Leave a Reply

Your email address will not be published. Required fields are marked *