Protocol:
Programme Director
Chairperson and CEO of cidb
The representative of the host employer – Mr Charles Wright of Stefanutti Stocks
Representatives of the construction sector
Most importantly the young learners present
Ladies and gentlemen
Thank you for inviting me to this important occasion and allowing me to share some thoughts with you. Welcome to all participants to the launch of the cidb Best Practice Standards and the ESDA (Employment Skills Development Agency) graduation.
I also want to welcome the participants from industry and client organisations that are here today, many of whom have participated in the development of these Best Practice Standards. This launch marks a milestone in the industry's participation in the development of these Standards - developed in partnership with government.
And, of course, a special word of welcome to the 22 learners who will be graduating and exiting from the pilot ESDA - but more about this later.
National Infrastructure Plan
The President of the country and Cabinet have allocated over R1 trillion over the next five years to investment in infrastructure - reaffirming that the creation and maintenance of infrastructure is central to driving the economic growth of the country and job creation.
The National Infrastructure Plan for the country – led by the President - speaks to the following:
- the need to develop a comprehensive plan which would address the legacy of apartheid spatial planning by integrating those parts of the country – rural areas in particular – which had been historically excluded from economic development.
- the need to use infrastructure development as a lead sector in developing the necessary economic linkages to drive inclusive economic growth and development; and
- the need for infrastructure development to lead the struggle against the triple evils of poverty, unemployment and inequality.
Eighteen major long-term Strategic Integrated Projects (SIPs) have been developed to promote regional economies and job creation. Examples include:
SIP1: (coordinated by the Minister of Public Works) aims to unlock SA’s northern mineral belt centred in Limpopo through key infrastructure provision in Waterberg and Steelpoort districts, initiate new energy and industrial development, develop a new city around Lephalale, shift coal transport from road to rail in Mpumalanga and increase rail capacity to Richards Bay whilst supporting regional integration.
SIP6: Integrated Municipal Infrastructure Project – to assist the least resourced districts to address all infrastructure, maintenance and basic services backlogs.
This infrastructure delivery plan needs to be delivered – by the construction sector - in a manner that provides value to the country – and this value depends on appropriate planning of the infrastructure, and also value delivered by contractors through the construction process. This infrastructure must be delivered to the right standard and quality, and on time.
However, all too often we have seen examples of poor quality construction, contractors failing to deliver, excessive price escalations, and dare I say it -collusion. This has cost the country many millions of Rands – even billions. The cost of poor quality has been estimated by the cidb to be around R4 billion per year.
Combatting collusion
In relation to the issue of collusion, I just need to flag that the findings of the Competition Commission and subsequent processes – I believe - mark a major milestone - and hopefully a turning point - in the evolution of the construction sector in this country.
Of course the findings leave us with a dilemma:
- Wrong-doers need to be held to account – no matter how big they are.
- But we are also dependent on what is a vital sector of the economy as a lead driver of economic development and job creation.
- My own view is that we have to strategies on how best to use this moment in the life of the construction industry to promote transformation and development of the sector. This is something we can start to think about and discuss for the future.
But at this point in time it is vital that we respect the statutory processes which must still unfold. In particular, the CIDB (Construction Industry Development Board) is obliged to initiate its own process of investigation into the firms’ conduct in terms of section 28 of the Construction Industry Development Regulations of 2004 and the CIDB Code of Conduct, and – I must stress this - this process is independent of the Minister.
I would appeal to all parties to cooperate with the CIDB. It is the body specifically charged by law to regulate and maintain ethical standards in the industry. Help them to do their job.
Best Practice Standards
The Best Practice Standards that are being issued today - in terms of the cidb Best Practice Contractor Recognition Scheme - aim to match the needs of the client (that is the state) with the abilities of the contractor. The cidb Best Practice Contractor Recognition Scheme aims to reduce the incidence of poor quality and to enhance value to clients.
While the state demands that infrastructure is delivered within specification, government is also committed to using the process of infrastructure delivery to achieve socio-economic objectives. Government is committed to enhancing employment, enhancing skills development, enterprise development, transformation and empowerment as well as Health &Safety practices through the process of contracting construction projects.
The best Practice Standards issued in terms of the Best Practice Project
Assessment Scheme address this, and I complement the cidb on the Standards that are launched here today on black enterprise development and skills development. I also acknowledge the industry stakeholders that have worked with the cidb in developing these Standards.
These Standards complement government's initiatives such as the EPWP. I am told that these Standards - once fully rolled out - will create around R5 billion of development support for SMME (small, medium and micro level entrepreneurs) contractors per year, and will create around 3,000 learning opportunities per year on government construction projects.
At present, these Standards are voluntary. But my Department is working with the cidb to introduce Regulation that will make these best practice Standards issued in terms of the Project Assessment Scheme to be mandatory on public sector projects. I am aiming to introduce the necessary Regulation early next year.
However, I encourage clients, and public sector clients in particular, to adopt these standards now, and incorporate them into our conditions of contract. In this regard I am pleased that the Standard for Skills Development will shortly be incorporated into the 18 SIPs.
However, while I complement the cidb on these Standards that support enterprise development, skills development, enhancing Health and Safety and so on – I also want to challenge and encourage the cidb to do more on establishing Standards for enhancing job creation.
Cidb ESDA (Employment Skills Development Agency) Pilot Graduation Ceremony
Ladies and gentlemen, I now want to turn to something that is very close to my heart - the graduation of the 22 learners here today. Infrastructure is not only about cement, stone, steel and other building materials. Infrastructure is also about the people who create and maintain the infrastructure, and the skills they bring to bear on the construction process. It is about the human potential, it is about the designers, the managers, the foremen, the supervisors, professionals, artisans and general workers.
Just some background to the ESDA programme:
In 2006 the National Department of Labour invited applications for the registration of employment skills intermediaries to assist the SETAs with the attainment of the National Skills Development Strategy targets.
Specifically the ESDAs were intended to:
- ensure continuity of learning across different workplaces for learnership candidates and apprentices to ensure completion of their training contracts;
- ESDAs were also expected to improve the quality of training available to learners by assessing and managing workplaces;
- help bring SMMEs (small, medium and micro enterprises) into the regulated training environment; and
- provide employment services for SMMEs that did not have the capacity to manage their own learnerships, while committed to providing high quality recognised training to unemployed learners.
The cidb applied for and was granted ESDA. The cidb-Industry ESDA application was supported by private industry in the form of BBCBE, MBSA and SAFCEC who committed to providing workplace training opportunities for the ESDA learners.
The cidb successfully piloted the ESDA implementation model in partnership with Tshwane South FET College. Twenty two learners were placed with construction companies and have completed their workplace training in terms of the pilot project. The learners have undergone their respective outcomes tests – summative assessments in the case of the civil learners and bricklaying trade test for the building learners.
Based on the lessons learned from the ESDA pilot the cidb is establishing a Skills Development Agency (SDA) – to facilitate implementation of the cidb Standard for Developing Skills through Infrastructure Contracts.
Colleagues, our strategy and goal is to ensure that infrastructure investment leaves a legacy of skilled people who then go on to create further infrastructure.
Government is very conscious of the skills shortages ( which is a massive brake on economic development); the relevance and appropriateness of skills to the industry's needs and the need for sustainable skills development. This is being addressed together with the Department of Higher Education and Training, the Department of Basic Education and the Department of Economic Development. Skills development is receiving the highest attention at Cabinet.
In this connection, the Skills Standard that is being launched here today requires that practical learning opportunities be provided for on government infrastructure projects - and today 22 learners are graduating here today from such a pilot project.
I congratulate the learners on their accomplishment; I welcome the learners to this important industry sector; and I express my thanks to the construction industry and to the cidb on this initiative. This serves as an example of how infrastructure delivered by the state is also delivering skills, and employment opportunities.
Before I hand over the graduation certificates, I would like to hand back to the Programme Director to first say a few words.
I thank you.
