Archive for category Charters
Update – are QSE and sector code certificates valid?
Posted by Keith in Accreditation, Charters, Verification, procurement on July 13th, 2009
We spoke recently about QSE certificates that may be invalid after 1st August because no verification agency has been given an accreditation to renders services for code 800.
This resulted in a call from Christinah Leballo from SANAS who informed us that agencies do indeed have accreditation to render code 800 verification. She explained that SANAS did not want to complicate the certificate by adding in the words “Code 800 QSE”. Personally I don’t think that three extra words on a certificate is going to ruin the aesthetics of the certificate. (Look at an example). She did however state that if we considered it confusing that certificates do not have Code 800 QSE on it, they will address it by adding those words onto the certificate. We don’t consider it confusing at all. As far as we are concerned, if an agency does not have accreditation rights to render a specific service, they are not allowed to do so. SANAS is an accredited ISO accreditation agency. Their role is to accredit organisations to do specific tasks, e.g blood transfusion services, medical laboratories, calibration laboratories. The purpose of ISO is to ensure that procedures, methodologies and standards and complied with and followed and of course to remove confusion.
She also confirmed that no agency has been given accreditation to verify on any of the gazetted sector codes. This clearly means that any entity in the tourism, construction or forestry industry will not be able to produce a valid certificate and any certificate they do produce will NOT be able to be used to earn procurement points.
There is almost no chance that the dti will be able to produce an interpretive guide and verification manual for each of the sector codes by 1st August, and SANAS will not be able to accredit any agency by then. We would be surprised to see this happen before the end of the year.
The only alternative is for the minister to issue a notice allowing all entities in those industries to use the codes of good practice, or alternately granting an extension to companies in those industries from having to produce a valid scorecard.
This would be funny if it were not so serious
The new minister of energy will be talking at a seminar tomorrow. The media release published by her spokesman states:
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“9 June 2009
Members of the media are invited to cover the AMEF Seminar to be held later this week.
Date: 11 June 2009
Venue: Gallagher Estates, Midrand
Time: 08h30 to 13h00
Brief background:
The AMEF played a pivotal role in the development and final agreement by all major industry players to commit to the Liquid Fuels Empowerment Charter. This was a pioneering initiative in that it was the first charter to facilitate empowerment of historically disadvantaged individuals in any industry. The charters that followed, leading up to the creation of the Broad Based Black Economic Empowerment (BBBEE) scorecard were drawn on the learning of the oil industry.
The charter was signed by all heads of all significant companies and organisations involved in the liquid fuels industry on the 2 November 2000. As the 10 year anniversary draws nearer, it is also an opportunity to reflect on the transformation journey of the industry. It is also an opportunity to identify the hurdles inhibiting progress and celebrate the successes achieved thus far.
In her speech, the Minister of Energy Ms Dipuo Peters will reflect on the current status of progress against the charter by outlining the actions that have been taken by government to comply with the charter. She will also identify areas that need extra attention to reach the November 2010 targeted date and beyond. Most importantly, the Minister will also emphasise on the need to ensure that BEE is not eroded by the current economic meltdown and further reflect on the implications for the economy as a result of Black Economic Empowerment (BEE) deals.
For more information, my contact details are as follows:
Zodwa Batyashe
MLO (Minister’s Spokesperson)
Cell: 083 255 8849
E-mail: Zodwa.batyashe@dme.gov.za
Issued by: Department of Energy
9 June 2009″
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I take issue with the comment “The charters that followed, leading up to the creation of the Broad Based Black Economic Empowerment (BBBEE) scorecard were drawn on the learning of the oil industry.”
On second thoughts maybe the entire codes were drawn up based on the learning of the oil industry. Maybe the architects of the codes said to themselves “Whatever the liquid fuels charter says – let’s do the opposite”, and then drew up the excellent codes of good practice.
Pity that the government does not practise their own policies!
Pity that the minister is taking credit for the B-BBEE codes when her petroleum charter is such a mess, and serves little empowerment purposes.
Pity that a company in the oil industry has to follow the act in order to get permission to operate, and then has to follow the codes of good practice in everything else it does.
And the president is trying to ensure service delivery and remove red tape. The minister of energy is not delivering by making life more complicated for business. The minister of energy is not helping transformation nor empowerment by ignoring,neglecting and almost sabotaging the broad based black economic empowerment act.
What has happened to the sector codes?
On 14th May 2009, the dti announced that the tourism, construction and forestry sector codes had been gazetted. The dti said that the government gazette document would be published on their web site on 18th May. Subsequently the tourism sector code was published, and must now be followed by all enterprises in the tourism industry. However the construction and forestry sector codes are nowhere to be found.
Initially the dti blamed the government printer for the delay. Today is the 8th June – surely there is sufficient time to print/publish a document that has already been gazetted – if the dti is to be believed?
I can only guess that there was some fault with the construction and forestry charters, that they had to be sent back to the relevant steering committees.
If so, this will be a big disappointment. It has taken over 2 years to get the first charter into a sector code and legally binding – the tourism charter. The second and third charters would have been construction and forestry – which now seem to have problems. so there is the possibility of further delays to the charters and further excuses that enterprises will use not to comply.
As is becoming the norm, the dti is taking a really good set of legislation and sabotaging it by their own inefficiency.
B-BBEE Sector Codes
The dti has announced that the first BBBEE sector codes have now been signed. This announcement is certainly another landmark reached very likely marks the start of a few more BEE Sector codes in the near future.
Admittedly this is a move that I did not expect (I was hoping that no sector codes would be gazetted and the codes used instead). Nonetheless all organisations who fall part of the Tourism, Construction, and Forestry sector will now start following their applicable sector code and not the BEE Codes of Good Practice.
EconoBEE V3 and EconoLog scorecard tools. We will ofcourse be updating our software tools to include all sector codes gazetted.
We have many questions that we will be asking of the dti and investigating ourselves. Feel free to contact us if you have any issues you wish to highlight.
Mining Charter
I’ve done quite a bit of work with the mining industry recently. The mining charter (which is an act, and not a BEE sector code) sets targets for mining houses to get their mining licenses renewed. The deadline is July 2009, so there is going to be lots of excitement soon.
The mining charter is not broad-based, does not follow the codes and virtually only requires 26% black ownership to comply. It does have other requirements, but they are so tenuous as to be meaningless.
The biggest complaint most people have about BEE is that it is not sufficiently broad-based and does not benefit the people whom the act intended. The mining charter falls into this category.
Now I was wondering how to change this: Ideally the mining charter should become a sector code as part of the B-BBEE act. The way to get a new charter and then sector code is to start with the industry itself . The following groups need to come together to ask the dti minister to start the process;
- The mining houses and mines
- The Chamber of mines
- The unions
- The responsible government department (ie. DME)
They need to prove to the minister that they represent the main and majority interest groups in the industry.
I then realised that there is almost no chance of this happening. Let’s only look at the mines that condemn the mining charter. Would they be happy going to a proper scorecard? Not likely! The few that do not have their licenses will obviously jump at the opportunity. The majority that have, will see this as a way to prevent easy access to the industry. They will feel that they have had to “make sacrifices” to get their 26% ownership . Of course if they had to now fill in a scorecard with a decent target of say level 3, they may find that they fall short. Many ownership deals are not worth that much on the scorecard, and many mines have not looked at the rest of the scorecard, so would have a bad score.
The other role players would probably be even less likely to support a move to a broad-based scorecard.
Sad to say, but I doubt that the mining charter will become broad-based and follow the B-BBEE codes any time soon.
Financial BEE Charter Collapses
Posted by Keith in Charters, Verification on April 2nd, 2009
So, the Financial Services BEE charter has now collapsed. This is one case where I can say “I told you so”. For years I have been promoting BEE, but stating that the charters are a total waste of time – the only people who benefited were the lawyers and consultants. I have previously disclosed that I was asked to comment on the legal charter for the department of justice and constitutional development and earned a couple of thousand rands before they listened to me and decided to abandon it as a sector code.
In the case of the financial charter, many banking people criticised me when I stated that the FSC was not following the law, was using incorrect definitions etc. They promised that it would be brought in line with the codes. It did not.
What is more interesting is that the financial sector still seem to have absolutely no understanding on BEE or what a charter, and sector code is all about. The news report is that the banks and government could not reach consensus on the ownership issue. Apparently the banks wanted the ownership target to be 10% and the dti 15%.
I wonder if the banks actually understand what the BEE codes really say and mean? The truth is that they have always had to produce a BEE scorecard. They HAD to use the codes of good practice unless the FSC had become a sector code. In the event Nedbank has actually produced a BEE scorecard based no the codes, while ABSA and Standard Bank have a ridiculous looking FSC scorecard showing that they are level 2s. Seriously, this is not April 1st!
The sad thing is that many verification agencies have chosen to ACCEPT those FSC scorecards even though they carried no legal weight. From now on, all banks – the entire financial sector – must use the Codes of Good Practice scorecard. They have never had any discretion previously and certainly do not have any longer. I personally am going to make sure that the NCR and other financial regulators follow government law and demand a scorecard from the banks.
Now what do those codes say about ownership:
Target = 25% plus one vote.
What did dti want: 15%.
What did the banks offer: 10%.
What are they now going to have to follow: 25% plus one vote!!!!!!
Is the financial sector mad not to have gone along with the dti’s request for 15% ownership? Don’t they see their stupidity?
ICT Charter
Reports are that the ICT charter has missed its deadline again. I continue to wonder why industries continue to have charters. So far no charter has been finalised – some are quite far down the line, but none has maded it to the final gazetting stage.
The transport charter is a huge document – they have created sub-charters for every industry within the tranport industry – even including forwarding and clearing!
All it has done is delayed the process, and given some good business to consultants and lawyers. We ourselves have been involved in the legal charter – but we told them their charter will never be gazetted if they are going to change the definitions. In the end they published it as a “social charter”, hoping to get law firms to adopt it, but realising that the codes of good practise should be used instead.
Now, 2 years later theICT charter is still not ready, and unlikely to ever be finished – sounds a bit like the IT industry – they never seem to finish any program they start! Yes, a bit harsh, since I was in the IT industry for many years before starting EconoServ in 2000.
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