Name Surname

1
BRIEFING TO THE PORTFOLIO COMMITTEE FOR SMALL
BUSINESS DEVELOPMENT ONTHE STRATEGY FOR SMMEs
AND COOPERATIVES Presented by Mr. Mpho
Mofokeng CFO Water Trading Entity (WTE) Date
11 MARCH 2015
PRESENTATION TITLE Presented by Name
Surname Directorate Date
2
Presentation Outline

• Purpose.
• Seven elements of empowerment
• Enablers
• Initiative to Bridge the Gap in the Engineering
  Industry
• Current Achievement.
• Challenges .
• Socio Economic Development Plans for major
  projects.
• Goods and Services to be procured for the major
  projects.

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Purpose

• The purpose of this presentation is to brief the
  Portfolio Committee for Small Business
  Development on the Department of Water and
  Sanitations BBBEE Policy.

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The Seven Elements of Empowerment

1. Management Control Measures the EFFECTIVE
   control of DWS and its Entities by Black People.
2. Employment Equity Measures the INITIATIVES
   intended to achieve EQUITY in the workplace under
   the Act, and the Employment Equity Act.
3. Skills Development measures the EXTENT to which
   employers carry out INITIATIVES designed to
   develop the competencies of Black Employees.
4. Preferential Procurement measures the EXTENT to
   which enterprises BUY goods and services from
   suppliers with STRONG B-BBEE Procurement
   Recognition level.
5. Enterprise Development measures the EXTENT to
   which Enterprises carry out INITIATIVES intended
   to assist and accelerate the development and
   sustainability of other enterprises.
6. Socio-Economic Development measures the EXTENT
   to which enterprises carry out INITIATIVES that
   contribute towards Socio-Economic Development or
   Sector-Specific initiatives that promote access
   to the economy for Black People.

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Enablers

• Approved BBBEE Policy which sets the tone from
  top.
• Establishment of a supplier database which
  accommodates the SMME. The department advertises
  for applicants twice a year to ensure that the
  newly established companies do not have to wait
  for a year to be registered on a departmental
  supplier database
• The PPPFA is applied to purchases above R 30 000
• in that the department ensure participation of
  SMME where they are given an opportunity to
  participate in the economical stream of the
  country.

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Initiative to Bridge the Gap in the Engineering
Industry

• The Department has established a panel of 45 of
• multi-disciplinary professional service
  providers in
• the engineering field i.e civil, structural,
  mechanical,
• electrical engineering, architectural and
  project management.
• Companies with the lower CIDB grading i.e grade
  2 have been paired with companies with a higher
  CIDB grading i.e grade 9 when allocated work in
  order to ensure that there is development which
  will in turn produce 9 CIDB grading from small
  companies in this field.
• The department encourages joint venture and
  monitors them for the duration of contract and
  the work allocation to ensure that you build
  technical capacity .

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Current Achievements

• Procurement worth R75m has been spent on
• SMMEs as at end of
• December 2014

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Current Achievements continued
Year Threshold Value Progressive increase Percentage increase
2013/14 Below 30 000 R 33 736 431.60
2014/15 Below 30 000 R 34 992 273.03
R 1 255841.43 4
2013/14 Above 30 000 R 35 696 363.82
2014/15 Above 30 000 R 39 611 534.42
R 3 915 170.60 10
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Challenges

• The BEE Certificate does not provide the break
  down in respect of the women, youth and people
  with disabilities.
• SMMEs ability to honour contracts and deliver
  due to lack of sufficient funding.
• Many of the SMME companies find it difficult to
  comply with administrative compliance.

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Socio Economic Development Plans for major
projects

• 1. Raising of Clanwilliam Dam and other capital
  projects
• Employment of 60 workforce from local
  communities (West Coast District).
• Anticipated value of all procurement is R 671,4 m
  
• (excluding VAT).
• Category I and II identified for local SMMEs.
• Promotion of Joint Venture partnerships (above
  25)
• with Black-owned and managed enterprises.
• Procurement system developed to operationalise
  the
• Plan by specifying functionality for
  evaluation criteria
• (locality women-owned youth-owned local
  production
• of goods formation of corporatives etc).
• Skills Development Long-term development of a
  viable engineering and construction skills
  base to support future projects. Budget 0.25

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Goods and Services to be procured
Aggregates Waterstops IT supplies
Ready-mix concrete Oil and lubricants Cleaning and furniture
Sand Paint materials Maintenance of conveyors
Cement materials Drilling and Blasting Protective clothing
Additives General construction materials Installation of water supply plant
Curing compound Specialized protection and doweling Paving and storm water drains
Rocks Specialized floors surface preparation
Reinforcing materials Hard excavations
Concrete and HDPE pipes Grassing and fencing
Formwork Scaffolding Mechanical items
Site establishment items Survey equipment
Sewage treatment Erection of buildings
Carports Electrical cables
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Socio Economic Development Plans for major
projects (Conti)

• 2. Raising of Hazelmere Dam
• Employment of 60 workforce from local
  communities (eThekwini Metro and iLembe
  District).
• Anticipated value of procurement is R 498.1 m
• (excluding VAT).
• Two (2) Nominated Enterprise Development
  Beneficiaries
• (NEDBs who are SMMEs) from KwaZulu-Natal.
• Focus of development increased annual turnover
  and
• CIDB grading of NEDBs.
• Skills Development Development of a viable
• engineering and construction skills base
  for workforce
• and NEDBs.
• Budget 0.25 of the contract price.

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Goods and Services to be procured
Concrete (Structural) Structural Steelwork (Sundry Items) Medium pressure pipelines
Formwork items Structural steel Pipes
Reinforcing items Handrails Valves and Specials
Concrete items Joints Ladders
Flooring
Rock Anchors Drilling, Water Pressure Testing and Grouting
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Socio Economic Development Plans to be developed

• uMzimvubu Water Project
• Greater Letaba Project

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Socio Economic Development Plans for major
projects (Conti)

• 3. ORWRDP BDS
• Targets for employment 100 of unskilled workers
  from local communities, targets for youth, women,
  PwDs and military veterans.
• Anticipated value of construction contract is
  R 3.5 b (excluding VAT).
• Three (3) Nominated Enterprise Development
  Beneficiaries (NEDBs who are SMMEs) from Limpopo.
• Focus of development increased annual turnover
  and CIDB grading of NEDBs.
• Skills Development Development of a viable
  engineering and construction skills through
  skills programmes learnerships internships
  mentorship and bursaries.
• Budget R12,4m.

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Thank you