Here comes a bid to revive the construction transformation charter

16 Mar 2016

Ujuh Reporter

The Construction Industry Charter Council (CSCC) seems to be harbouring hopes, or is it a mission, to revive the charter killed by a ministerial decree. That is if statements made by the CSCC yesterday are anything to go by.

This is after the minister of trade and industry, Rob Davies, repealed the construction sector transformation charter last month alongside the Chartered Accountancy Charter. This meant that companies in these sectors will have to follow the generic transformation scorecards as carried in the B-BBEE codes of good practice. The move has caused some brouhaha in the construction sector.

In its statement the CSCC refers to continued push to finalise the construction sector code but does not clarify the legal status of such a move.

The statement said “Although the construction sector code was repealed as a result of the industry’s inability to meet the deadline for alignment set out by the DTI, the industry’s major stakeholders and associations are still tirelessly engaged in efforts to finalize the outstanding areas (ownership target and skills development) of the new-look construction code.

“This commitment was re-enforced during a high-level meeting of the construction industry captains and principals that was convened by the Minister of Public Works recently held in Johannesburg.”

The statement adds that “Through a high-level mediated process, the alignment negotiations must be finalised within the next few weeks and will have to report back to Minister Nxesi on the progress made towards the finalization of the new construction charter.”
The CSCC statement also speaks of a need to for a transition period allowing for companies who committed plans and budgets using the construction charter to continue with their plans and start afresh in the next appropriate interval.

The CSCC argues that entities that have aligned B-BBEE certification to their financial year-end stand to be prejudiced if they are not afforded some breathing space.

Many entities would have already commenced with their B-BBEE measurement process. “This is premised by the fact that a B-BBEE verification measurement is inherently and by its very nature, a process that place reliance on the financial information and spend that would already have been incurred previously in accordance with the construction sector code that was valid at the time (of commitment)…”

The statement added that “the current notice of repeal makes it impractical for such to be recognised and as such, will have adverse effects on the accurate reliability of information and substantive measurement of B-BBEE spend for a particular period.

“In an effort to arrive at the progressive resolution of this dilemma, the CSCC is on record as having recommended and presented to the DTI a mechanism to ensure that, at best, the notice of repeal is corrected to provide for a reasonable period (possibly six (6) months period) to ensure that a phased-in approach is developed to allow for Large Measured Entities an opportunity to adjust their processes and systems for reporting on BBBEE.

“In line with this, the CSCC has proposed that construction sector Measured Entities be provided with an option to use either the construction sector code (to the extent that it is applicable at the time) or the Amended Generic B-BBEE Codes of Good Practice until such time that the negotiations around the new sector code are finalized.”

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