Council for Built Environment Bill & Engineering Professions Bill: discussion on amendments

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Meeting report

COUNCIL FOR THE BUILT ENVIRONMENT BILL & ENGINEERING PROFESSIONS BILL: AMENDMENTS DELIBERATIONS

PUBLIC WORKS PORTFOLIO COMMITTEE
7 September 2000
COUNCIL FOR THE BUILT ENVIRONMENT BILL & ENGINEERING PROFESSIONS BILL: AMENDMENTS DELIBERATIONS


Chairperson: Chief M Hlengwa (IFP)

Relevant documents:
Presentation : "Progress towards the Establishment of the Construction Industry Development Board" - text outline (see Appendix 1)
Amendments agreed to : Council for the Built Environment Bill [B16 - 2000]
Amendments agreed to : Engineering Professions Bill [B19 - 2000]

SUMMARY
A presentation, including a video, was made on the Construction Industry Development Board.

The proposed amendments to the Council for the Built Environment Bill (CBE Bill) and Engineering Profession Bill (EP Bill) as requested by the Portfolio Committee during deliberations were discussed in a clause by clause analysis led by the Department of Public Works. The Department undertook to make any changes and circulate these to the committee the following day.

The Portfolio Committee will attend the NCOP public hearings on the Construction Industry Development Board Bill tentatively scheduled for 19 September 2000 [Ed. note: it was subsequently decided on 12/09/00 that provinces would hold hearings and not the NCOP due to time constraints].

MINUTES
Construction Industry Development Board
Mr Spencer Hodgson, Chief Director for the Construction Industry Development Programme in the Department of Public Works presented a video on the background to the formation and aims of the Construction Industry Development Board (CIDB). He outlined the progress toward the establishment of the CIDB covering the following issues:
- Identification of problems facing the construction industry
- White Paper solutions to address these problems
- The need for the CIDB
- Priority programmes (that have proceeded the establishment of the CIDB)
- The role of government

The legislation to establish the Board covers the following provisions:
- Definitions - notably of the 'Best Practice' standards for both suppliers and contractors, as well as the definition of the CIDB as an organ of state.
- The CIDB's key objectives, functions, powers and duties
- The appointment of the Board
- The CEO of the Board
- Stakeholder consultation
- Governmental evaluation and review
- Establishment of a register of contractors
- Establishment of a register of projects
- Financial management of the Board

The presentation concluded by outlining the envisaged benefits of the CIDB and the process forward.

Discussion
The Chair noted that members would only have received the proposed CIDB Bill at a very late stage, and so proposed that these deliberations be postponed to allow all a chance to study the legislation. The forum accepted this proposal.

Mr Sigwela (ANC) noted that an earlier presentation had shown an insistence on Best Practice, but noted that this was the area where there was the greatest amount of confusion amongst emerging contractors. He expressed the need for a module to be developed which will build understanding as a way of building capacity among emerging contractors.

Mr Abram (UDM) noted the Bill was scheduled for public hearings in the NCOP the following week and asked what the status of the Portfolio Committee is at these hearings?

Mr Hodgson replied that the Bill is on the roll of the NCOP, but that as both the Portfolio Committee and the Select Committee have had members away from Cape Town it had made communication and co-ordination difficult. He stated that in a meeting with the Chief Whip it was decided that the Chief Whip would consult with the Portfolio Committee Chair to co-ordinate these processes.

Mr Abram asked for clarity as to the process forward, as he was concerned at being relegated to the role of bystander at the Select Committee hearings. He noted that the Chair was returning to Pretoria that afternoon and so questioned the possibility of consultation with the Chief Whip. He was very concerned that little planning of the hearings process was being done and saw this as a possible hindrance to the success of these.

Mr Chikane (ANC) explained that once a Bill falls under section 76 of the Constitution, authority is given to the NCOP to drive that forum. The Portfolio Committee's role is to form a vital link in ensuring national uniformity through identical interpretation.

The Chair suggested that Mr Hodgson return to the NCOP and ask that the Portfolio Committee be formally invited to participate in the public hearings.

Mr Hodgson underlined that issues beyond their control had resulted in the poor planning of the process, but emphasised that the main aim was to get the legislation passed as soon as possible.

Mr Middleton asked that all documentation relating to the public hearings be submitted to the Portfolio Committee as well.

The Chair replied that this would only be possible once the Portfolio Committee is formally part of the public hearings process, and that they should wait for word from the Select Committee and Chief Whip.

Council for the Built Environment Bill
Mr Buks Annandale, Director of Legal Services: Department of Public Works, presented the proposed amendments to this bill that were a result of earlier deliberations by the committee.

Clause Five
Mr Annandale stated that this clause had been amended in order to reflect the principle of 20 / 20 / 60 representivity with a total number of 20 members.

Clause Six
No discussion arose from the amended clause.

Clause Eight
Mr Annandale said that although the Department had re-worked this clause, the team had come up with better wording that morning which was as follows:

"has been convicted of an offence in the Republic of South Africa, other than an offence committed prior to 27 April 1994 associated with political objectives and was sentenced to imprisonment without the option of a fine, or, in the case of fraud, to a fine or imprisonment or both."

"has been convicted of an offence in a foreign country and was sentenced to imprisonment without the option of a fine, or, in the case of fraud, to a fine or imprisonment or both.

For the purposes of subsection 1 (d), the Minister must take cognisance of the political circumstances of that conviction made in the a foreign country."

The Chair raised a concern that this new version could possibly be interpreted differently, questioning whether it allows for people who were not South African citizens at the time, but are citizens now.

Mr Annandale replied that the Minister would have overriding discretion as per subsection (2) which would act as a safeguard.

The Chair asked how the Department envisaged verification that crimes were indeed politically motivated.

Mr Hodgson stated that the amount of discussion that has been heard about this clause indeed reflects the difficulty of attempting to write legislation that accounts for every situation. This formulation allows for the Minister to apply his or her mind to the individual case in the unlikely event that this should ever come up.

Mr Chikane recommended the removal of the word "political" as otherwise the overriding powers of the Minister might be limited. He reminded the committee that people were sometimes sentenced on the basis of other crimes due to the fact that the state was unable to proceed against them for political crimes.

Mr Middleton questioned whether the date of 1994 should be included, as it was his opinion that people are still being unfairly convicted. Would the Minister be able to override such a sentence?

Mr Annandale stated that the Minister's overriding powers only existed in the case of convictions in a foreign country.

Mr Chikane reminded the meeting that people convicted of crimes in other countries may well be barred from becoming South African citizens.

Clause Nine
Mr Abram pointed out that although 9 (1) states that the "Minister must … appoint a chairperson", clause 9 (5) continues "the member so elected".

Mr Annandale thanked the member and undertook to change the word "elected" to read "appointed".

Clause Eleven
No discussion arose from the amended clause.

Clause Fifteen
Mr Annandale pointed to the inclusion of the clause relating to the performance agreement of the CEO [per the amended Engineering Profession Bill (Clause 8)]

Clause Seventeen
Mr Annandale requested the committee to make a further addition to this clause so that it read as follows:

On page 9, in line 20, to insert "any money received in terms of this Act".

Mr Abram asked whether it was not better to use the word "generally" in place of the words "in general".

After lengthy discussion the forum decided that both words had the same meaning. Mr Annandale stated that the word "generally" is more often used and undertook to make this change.

Clause Twenty One
No discussion arose from the amended clause.

Clause Twenty Two
No discussion arose from the amended clause.

Engineering Profession Bill
Mr Annandale presented the proposed amendments to this bill:

3. Composition of council
No discussion arose from the amended clause.

5. Term of office of members of council
No discussion arose from the amended clause.

6. Disqualification from membership of council and vacation of office
Mr Annandale referred members to the discussion and proposal dealt with under the CBE Bill (clause 8) and undertook to effect the same changes.

8. Appointment of chief executive officer and other staff members of council
No discussion arose from the amended clause.

9. Decisions of council
No discussion arose from the amended clause.

10. Administrative powers of council
No discussion arose from the amended clause.

12. Power of council with regard to fees and charges
No discussion arose from the amended clause.

13. Power of council with regard to education in engineering
No discussion arose from the amended clause.

15. Funds of council and keeping and auditing of accounts
No discussion arose from the amended clause.

18. Categories of registration
No discussion arose from the amended clause.

19. Registration
Mr Annandale requested the retention of the word "against" in order to reflect the fact that measurement was taking place. He also undertook to make changes arising from earlier discussions. The committee agreed.

24. Grievance procedure in relation of registration
No discussion arose from the amended clause.

26. Identification of work
No discussion arose from the amended clause.

30. Appointment of disciplinary tribunal
No discussion arose from the amended clause.

31. Disciplinary hearing
No discussion arose from the amended clause.

32. Proceedings after hearing
No discussion arose from the amended clause.

34. Professional fees
No discussion arose from the amended clause.

36. Rules
No discussion arose from the amended clause.

37. Procedures and evidence
No discussion arose from the amended clause.

Mr Annandale also undertook to include the South African Qualifications Act under the definition clause.

A letter was delivered to the meeting at closing inviting members to take part in the public hearings relating to the CBE Bill, as discussed earlier. Notice was given that these are to take place on 19 September 2000, but there was concern that this was the incorrect date, and that these hearings had been advertised for 12 September 2000. The Chair undertook to clarify this issue.

Appedix 1:

PROGRESS TOWARDS THE ESTABLISHMENT OF THE CONSTRUCTION INDUSTRY DEVELOPMENT BOARD (CIDB)

Inter-related set of Problems
Volatile and unstable industry
Impact on sustainable development
Costs continuously being driven down by clients
Often translates into poor performance and quality as contractors attempt to recover margins elsewhere
Historical barrier for entry to the emerging sector
Public Sector delivery management

White Paper Strategies
Growth and Stability of the Construction Industry
Enhanced industry performance (through Best Practice)
Promoting new industry capacity (skills development and promoting the emerging sector)
Developing the role & capacity of the Public Sector

Need for the CIDB
cannot be addressed in piece-meal approach
cannot be effectively dealt with by either Public or Private Sector alone
need for a focussed national agency to provide support to assist public and private sector organisations meet this challenge

Core focus areas emanating from the White Paper
[PMG Editor's Note: Graphs not included]

Priority Programmes
Programmes that have proceeded before establishment of the CIDB
Emerging Contractor Development Programme
Affirmative Procurement Policy (Targeted Procurement)
Project Management Course for the Public Sector
Delayed payments by the Public Sector

Role of Government
Client
Value for money
Facilitator
Regulator
Social & economic responsibility
Ensure industry growth and development

Enabling Legislation to Establish the CIDB
[PMG Editor's Note: Diagrams not included]

Preamble

CI - Indispensable role in the economy
Instability, volatility & structural problems
Unique nature of industry
Constraints to emerging sector
Investment constraints - need to promote
Impact on public - quality, productivity, she
Need for leadership, drive best practice
Vision for industry development strategy

Preambles to each chapter
Chapter One - Definitions
Best Practice means a desirable & appropriate standard, process, method or system in relation to the delivery process and the life cycle of fixed assets
Organ of State means an organ of State as defined in section 239 of the Constitution of RSA, Act No. 108, 1996

Chapter Two - Establishment of the CIDB
Objects of the Board
To promote the contribution of the Construction Industry
Provide strategic leadership
Determine & establish Best Practice
Promote :
Best Practice
Uniform application of policy
Ethical standards
Sustainable growth
Appropriate research
Implement Government policy
Powers, Functions and Duties
Must implement policies, programmes & projects
May initiate policy refinement and development in cooperation with Government
Must facilitate communication
Must establish a stakeholder forum
Must provide information on Best Practices, performance improvement, etc.
Must determine Best Practice priorities in consultation with Government
Must establish and maintain:
Register of Contractors
Best Practice contractor recognition scheme
Register of Projects
Best Practice projects assessment scheme
Must promote the uniform application of policy throughout all spheres of Government
Must identify and advise on Public Sector delivery constraints
Must publish a code of conduct
May monitor economic activity and measures according to which Public Sector spending is scheduled
May consult with organs of state to determine construction related budgets and application
May develop, promote and update the construction industry research agenda

Chapter Two - Appointment of the Board
At least 9 but not more than 13 members
Appointed through a formal process
Criteria will comprise a reasonable balance of expertise and knowledge whilst broadly reflecting the race, gender and geographic composition of SA
Remuneration determined by the Minister in consultation with Minister of Finance

Chapter Two - CEO of the CIDB
CEO appointed by the Board in consultation with the Minister
Five year contract period
Subject to performance agreements, etc.
Remuneration determined by the Board as approved by the Minister and Minister of Finance

Chapter Two - Stakeholder Consultation
The Board must constitute a Stakeholder Forum to inform it on matters that affect Construction Industry Development
Comprises individuals with experience, skills, expertise necessary to inform the Board appropriately
Represent Stakeholders
The Board must at least once per year convene a meeting of the Stakeholder Forum with the Minister

Chapter Two - Evaluation & Review
Submit an annual business plan for approval by the Minister
Submit an annual report.
Be subject to an independent evaluation every 5 years to determine the relevance and value added by the CIDB

Chapter Three - Register of Contractors
Tool for managing risk; promoting best practice; nature & performance of contractors
Single register (reciprocity with other statutory registers - NHBRC)
Mandatory for public sector
Private sector use will be encouraged but not prescribed
Viable to operate because of IT developments
Phase 2 - Contractor Recognition Scheme

Chapter Four - Register of Projects
Gather information on nature, value and distribution of projects
Projects above a certain value will be registered (continuation of current situation where all projects are subject to some sort of registration)
Projects above a certain value subject to a registration fee
Best Practice Project Assessment Scheme (phase 2)
after establishment of RoP projects above a prescribed value subject to assessment

Chapter Five - Financial Management
Subjects the Board to the Public Finance Management Act (PFMA)
Deals with funding of the Board, financial year end, etc.
In terms of the PFMA, the Board is the accounting authority and the members are jointly and severally liable

Chapter Six - General
Matters such as restriction on the use of name, enforcement of Code of Conduct, secrecy, etc.
Consultation
The Minister must ensure appropriate consultation with other affected Ministers
Regulations
The Minister may, by notice in the Gazette, make regulations on any matter that is required or permitted to be prescribed in terms of the Act

Envisaged Benefits of the CIDB
core national competence and resource
national authority recognised by the public and private sectors.
Reduced duplication of effort
Improved risk management and reduced cost.
Accelerated transformation and development
The establishment of best-practice
Sector status reports
Improved planning parameters for industry training requirements.
Standardised and simplified contracts
Enhanced development of emerging sector.
Enhanced public sector capacity to manage the delivery process

Process ahead
Legislation
State Law Advisor
Portfolio Committee
Parliament and National Council of Provinces
CIDB
Operational and Implementation plan
Framework for regulations

 

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