TransformSA by Liesel van der Schyf

The Quarterly Journal for a Transforming Nation

Transnet:

UNLEASHING A NEW PLAN

INSIDE: SMME – BANKS TACKLE CREDIT BUREAU DIFFICULTIES ICT: BEE NOT A TOOL FOR CHANGE CSI: OUTDATED FORM OF PLOUGHING BACK? BEE: STILL IMPORTANT FOR SOUTH AFRICA VOLUME 1 2011 ZAR 45.00

contents

INSIDE

Publisher's Note

Foreword

Editor's Letter

Contributors

Publisher's Details

Brian Molefe Speaks

Rebranding Hits SA

Gauteng Transport Vision

Property Sector's Lopsided Ownership

Back on the Agenda

Cause for Joy

BEE on Highroad

Film & Publications Board – Cause for Satisfaction

True or False – BB-Black Economic Empowerment

Tender Fraud to End

www.transformsa.co.za

88 “This is not a big issue in my or the banks’ life anymore. We are now reporting against the generic codes. It does not make 74 sense to expect people from such diverse backgrounds to agree,” Cas Coovadia, CEO of BASA. He was commenting on the tiff between banks and unions.

contents

INSIDE

State Now Serious on BEE – Expert

BEE Mergers on Hold

Local Government Training and Skills Development in South African Municipalities

Parks Tau – Mayor of Johannesburg

Kgosientsho Ramokgopa – Mayor of City of Tshwane

Mondli Gungubele – Mayor of Ekurhuleni

Patricia de Lille – Mayor of Cape Town

Zanoxolo Wayile – Mayor of Nelson Mandela Bay

Is Empowerment Sustainable?

Unleashing Economic Change from all Fronts

Private vs Public Schools

Criss-Crossing the Globe – Chris Hlekane

Global IT Groups Dictate BEE Schemes

Changing the Advertising Sector

Tiff Dashes Hopes of Economic Slice

Reviving Neglected SMEs

Will NGP Change Lives?

Young, Up and Coming Businessmen

Wine Unshackles Black Sisters

Learning from Emerging Markets – Kuseni Dlamini

Where are they now? – Don Ncube & Gaby Magomola

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“This will not be good for corporate mergers and acquisitions in South Africa going forward. Many deals will be delayed because of this. In 44 addition, there are still many things that are unclear in the new revisions, like the financing of transactions by banks, ” Stephan van der Walt, the head of corporate finance at Bravura.

PREFACE

publisher's note

s we approach the 18th year into our democracy, it has become clearer that South Africa has walked a fault-finding journey towards realizing a society that is truly reflective of her demographics both socially and economically. In this respect it remains vital to persist in engaging on debate about the issues that are affecting us as a nation while we continue to ask questions that trigger more dialogue in our quest to alleviate socio-economic ills which seem to overshadow and undermine the freedom of our nation. Without a doubt, we are too young a democracy to even think we have reached a point where the legacy of apartheid has vanished to the extent that righting the wrongs of our past has become irrelevant. The time has come for us to acknowledge and embrace that we are a very diverse nation that has a history of systematic division enforced by law. This requires not only legislation and policies to redress these socio-economic imbalances of the past but also time, perseverance, and cooperation. South Africa continues to face difficulty with regards to poverty alleviation, job creation, quality education, crime rate and proper human settlements. Some of these problems are not unique to our country but the combination, the conditions and the rate at which they manifest themselves may be. These therefore are not a problem that must be solved by any particular group or government alone but a problem that requires a collective effort by all those who profess a love for South Africa as they affect all of us. It is simple economics that the hungrier the majority of the people of a particular country are, the higher the crime rate. By the same token, it seems also quite simple to understand that the more people become economically active the more jobs we will have and the lesser the crime rate and lesser will be poverty. This is

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what transformation is about, changing people's lives for the better and to the benefit of the entire South African community. In the South African context the majority of the populace is black South Africans who have been marginalized in the past by a minority grouping. It is also on this basis that TransformSA quarterly comes to life.

We know therefore that we are unlikely to solve any of these challenges without acknowledging that transformation is necessary, because it is change. Transformation is inevitable, it is bound to happen, and hence we need to expect it, manage it so that the outcome is in our favour. Transform SA therefore provides a platform through which South Africans can learn about transformation in the South African context. This takes the form of economic and social transformation - black economic empowerment (BBB-EE), Small business development, women empowerment, youth development, community development and corporate social investment. Transform SA envisages fostering the relationship between economic and social transformation as these are interdependent in many ways. This also allows South Africans to understand black economic empowerment in the context of economic transformation rather than a simple get- rich-quick scheme. We also highlight the challenges that are facing various sectors in terms of transformation while we continue to discourage adversaries of transformation. I trust TransformSA will provide the much needed demystification of the transformation programme of our country. Thanking the TransformSA team, all contributors, subscribers and advertisers.

Saki Mabhele - Publisher

PREFACE

fore

word I

t is with a great sense of pride and optimism that I welcome you to the inaugural edition of TransformSA magazine. This comes at a time when we bear witness to immense challenges within the transformation space, charactirised by uncertainty yet offering numerous growth opportunities. It has been said that at times opportunity often comes disguised as an obstacle or as hard work. It is hardly surprising when one notes that some of the worldâ&#x20AC;&#x2122;s greatest achievements were accomplished by people who endured seemingly insurmountable impediments on the road to great achievements. Likewise this is the same path that the transformation journey must travel on its way to becoming a success. For we know all too well the various criticisms that have been levelled at transformation; from the alleged failure of BB-BEE, to the ineffectiveness of EE legislation right up to the skepticism that the BB-BEE Act and its attendant Codes of Good Practice have been viewed with. It is these issues that TransformSA must seek to analyse and highlight in order to create debate that will hopefully lead to an egalitarian society. This has to be through engaging articles that seek to critically analyse our transformation endeavours, with writers and analysts who are well versed with the intricacies of the transformation agenda along with forums for readers to formulate their own views of the transformation project as they see it. Amongst others, the purpose will be to completely dissect transformation in various BBBEE transactions in an effort to evaluate how truly empowering are they. It is my wish to see TransformSA thrive for it is when we constructively engage on platforms such as this that we can have any hope of driving transformation in our society. Happy reading!

â&#x20AC;&#x201C; B. Peter Vundla

www.transformsa.co.za

EDITORIAL

editor’s

letter This is the launch issue of 'TransformSA', South Africa’s new quarterly for a transforming nation, but it is also chock-full with excellent writing and journalism. 'TransformSA' will tell it like it is and without any fear or favour..

he magazine intends to be highly critical of sectors that are slow to change as well as run positive stories on South Africa’s transformation process. One piece in this issue that can be highlighted concerns a fresh angle the magazine has taken on the on-going fight between the banks and Cosatu over direct black ownership of these financial services institutions. That the deadlock between the parties over this issue will deny blacks economic benefits is an angle that has not been explored. True, if black direct ownership of banks is increased to 15 percent, the top four banks will have to restructure their current BEE deals. This can be costly for banks and it is not clear where about R25 billion will come from in these tough economic times. But on the other hand, increasing black ownership in the banks is also a business imperative that would allow blacks economic benefits they were denied for a long time. The article states that not much progress has been made in an attempt to resolve the banks/Cosatu deadlock in the past two years. The matter has been overtaken by other events. But there is also an encouraging story emanating from the manufacturing sector in the Eastern Cape. One manufacturing multinational giant has formed what is called a Rainbow Nation Club, which seeks to deal with racial tensions on the factory floor. This company has taken social corporate investment further and TransformSA hopes many corporates in the country could adopt this or any other progressive programme in the workplace. Other stories in this issue will no doubt delight and chill our readers too, like educationist Graeme Bloch’s deep descent into the private versus public schools debate and implications for transformation in the country. We think this all makes for a pretty special reading in this issue. Don’t you think? And as for TransformSA’s new fans, we urge you to go to the TransformSA website to download daily breaking stories on transformation. Enjoy.

One piece in this issue that can be highlighted concerns a fresh angle the magazine has taken on the on-going fight between the banks and Cosatu over direct black ownership of these financial services institutions.

– Mzwandile Jacks

www.transformsa.co.za

An Authorised Financial Services Provider

NOT JUST “ WE’RE COMPLYING. WE’RE TRANSFORMING OUR

“

tbsp /// beyond the line 33866

NEW HORIZONS

BUSINESS.

Edward Kieswetter, Group Chief Executive

Transformation is not a once-off event and at Alexander Forbes we’ve pledged ourselves to its continued journey. We’ve made great strides and proof of our commitment can be seen by our level 3 B-BBEE status, which we’ve retained for three consecutive years. There’s still significant work to be done but we’re well on our way towards contributing to the economic emancipation of black people.

Commitment beyond compliance.

www.alexanderforbes.co.za

contributors

PROFILES

Mthunzi Mdwaba is Vice President of BUSA, a governing body and member of the International Labour Organisation (ILO) and Management Board Member of the International Organisation of Employment, Geneva, Switzerland. A former Group Chief Executive Officer of Torque Holdings, and Deputy Chief Executive Officer of the Kelly Group, listed on the JSE. He was a leading team member in building Torque IT to be a world class, multi award-winning company, with clients in 27 countries within Africa. Torque was acquired by the Kelly Group in 2008. Mdwaba holds a BA, LLB from the University of the Witwatersrand. In 2004, he was awarded IT Personality of the year by the Computer Society of South Africa (CSSA). In 2009, Mdwaba was awarded BBQ Businessman of the year Award as well as overall Platinum Businessman of the Year and Topco Black Businessman of the year by the Metropolitan Oliver Empowerment Award.

Paul Berkowitz (Local Government Specialist) – is employed by Citydex, a specialist division of Empowerdex which specialises in municipal government research, analysis and consulting. His roles include product development, training and advisory services for municipalities. He is a graduate of the University Of Cape Town (UCT) with a B. Bus.Sci in Economics. He was an economics lecturer at the UCT before working for Econometrix as an economic analyst. In 2007 and 2008, he worked as an industry analyst at FNB Corporate Bank. In 2009 he joined the Centre for Applied Legal Studies, specialising in the analysis and research of water and sanitation issues in South Africa. This included government expenditure, service provision, municipal backlogs and consumer demand analysis.

Mdu Mkhonza is the President of the Black IT Forum (BITF). He also the chairperson of the KZN ICTe Cluster Board and is CEO of Akha-Unique Telecoms and Managing Director of NG Networks. Mkhonza is an activist. He’s been a member of many community/youth/professional organisations. He served as a member of the Statistics Council of South Africa, a member of the Cato Manor Development Association, the Lamontville Multimedia Centre and many others. He holds a number of qualifications: Secondary Teacher’s Diploma, BSc–Economics & Computer Science (Natal), Post-Graduate Diploma in Management (Natal), MBA- Information Management & e-Commerce (UKZN), Project Management (Wits), IT Management in Government (Wits), Information Technology Leadership (Wits), Principles of Business and Management (Wits) and Business Incubator Management (San Jose), Telocoms Mini MBA(Telecoms Academy). Graeme Bloch is visiting adjunct Professor at University of Witwatersrand Public and Development Management school (P+DM). He was DBSA education policy analyst. He taught in the education faculty at the University of Western Cape and was project manager for youth development at the Joint Education Trust. He has worked as head of Social Development in the Department of Welfare and as Director of Social Development in the Joburg Metro. Before 1994, he was executive member of the National Education Crisis Committee (NECC) as well as the United Democratic Front (UDF). For his involvement in the democratic movement he was detained and arrested numerous times. He was banned from 1976-81. He is a graduate of the University of Cape Town where he specialised in economic history and in 2011 attained his second MA from Wits, in creative writing. He is a member of UCT Council, serves as director on Lafarge Education Trust, is on the Board of Equal Education, the Advisory Board of Elma Philanthropies and is a patron of Bitou10 in Plettenberg Bay. Bloch is also a judge in the Impumelelo Innovation Awards. Sibonelo Radebe has practised as a ‘political economy journalist’ for more than 10 years. His is a self-imposed protest title against the painfully embedded and anti-intellectualist news media industry tags. Having worked for leading business publications, Business Day and Financial Mail, the industry would like to impose titles such as business reporter or financial journalist on him. For want of expressing difference against reinforcement of historical hegemonies of these titles, he runs with the ‘political economy’ journalist tag. His case is marked in his work for various independent publications and in the development of alternative media. He is currently in the employ of The New Age newspaper and is pursuing an ethnographic study of how newsrooms are interacting with the transformation demands of the post 1994 South Africa.

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Neren Rau assumed the role of CEO of SACCI in June 2008. Rau worked at the Reserve Bank for seven years and headed the Financial Safety Net Division of the Financial Stability Department. In that role, he was responsible for financial sector continuity planning inclusive of identifying risks that threaten the broader financial sector, formulating contingency plans and crisis management strategies to deal with such threats and developing and enhancing financial safety net policies. To a lesser degree, his division is also involved in monitoring the financial sector transformation process, black economic empowerment and initiatives to broaden access to finance. Both through this role as well in his previous position as a Deputy Director in the National Treasury, Rau had extensive experience in researching, negotiating and advising on government policy for the financial sector.

CREDITS

The Quarterly Journal for a Transforming Nation

publisher’s details Publisher

Managing Editor Feature Writer Production Director Production Manager Creative Direction Printer Advertising Sales Editorial Enquiries Advertising Enquiries Online Editor Online Advertising Administration General Enquiries

Saki Mabhele 376D Oak Avenue Office Park Randburg 2194 Tel: 0861 744 674 Fax: 0866 11 44 78 saki@transformsa.co.za Mzwandile Jacks mzwandile@transformsa.co.za Tiitsetso Tlelima ttlelima@transformsa.co.za Luvo Mxoli luvo@transformsa.co.za Nataski Vito nataski@transformsa.co.za Liesel van der Schyf liesel@vdsdesign.co.za SakiPrint cc Kgagamatso Maota editor@transformsa.co.za advertising@transformsa.co.za Tiitsetso Tlelima ttlelima@transformsa.co.za onlineads@transformsa.co.za Smangele Mpofu info@transformsa.co.za Tel: 0861 744 674 Fax: 0866 11 44 78 www.transformsa.co.za Facebook page: Like us through TransformSA website Twitter page: Follow us from TransformSA website Terms and conditions of use / Disclaimer TransformSA is a product of SAKIPRINT CC. 376 D Oak Ave. Office Park First Floor, Oak Avenue, Ferndale. TransformSA (USSN No. 2079-7273) considers it’s sources reliable and verifies as much data as possible. However, reporting inaccuracies can occur, consequently readers using this information do so at their own risk. TransformSA is sold with the understanding that the publisher is not rendering a legal or advisory service. Although companies and contributors mentioned herein are believed to be reputable, neither SAKIPRINT (Co. CK2002/063910/23), nor any of its employees, sales executives or contributors accept any responsibility whatsoever for such persons’ and companies’ activities. SAKIPRINT CC. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form without prior written permission of the publisher. Permission is only deemed valid if approval is in writing. TransformSA buys all rights to contribution, text, images unless previously agreed to in writing.

Volume 1 • 2011

Images: ÂŠ Transnet

COVER STORY

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COVER STORY

brian MOLEFE speaks

He has been one of the country’s leading proponents of transformation for a long time. His work on South Africa’s transformation of its listed companies forms the basis for heated debates on change all over the country. Business colossuses and BEE practitioners beat a path to his door. Written by Mzwandile Jacks

n so far as there is a popular line in South Africa’s environs of transformation, Brian Molefe, CEO of Transnet, lays it down. Transnet is the country’s biggest transport utility. Molefe is also the former CEO of South Africa’s only sovereign wealth fund, the Public Investment Corporation (PIC). He has been a staunch critic of South African companies that failed to transform themselves in the past few years.

exclusive interview, Molefe told TransformSA it was his duty to ensure that Transnet helped with realising the broader societal objective of transforming the economy.

These companies included Sasol, the JSE-listed petrochemicals giant. The PIC holds a significant stake in this company. He was also particularly harsh on other companies where PIC held a stake. Molefe’s current comments on transformation are as weighty as earlier ones. Speaking in an

“We have increased our BB-BEE spend over the past three years from R6.9 billion to R19.4 billion,” Molefe said. “This is 75 percent of our total procurement spend compared to a 50 percent target set by the Department of Trade and Industry (DTI).”

Transnet spent billions of rand annually in buying services and goods which it sees as its biggest opportunity to ensure that the South African economy is transformed.

Volume 1 • 2011

COVER STORY

Transnet is the custodian of South Africa’s transport and logistics infrastructure focusing on rail ports and pipelines. Operationally, its focus would be on ensuring that this network functions in a manner that facilitates trade, not only within South Africa, but the rest of the continent. On rail, it is paying particular attention to providing a scheduled rail, especially in the general freight business. The ports and container terminals are functioning well with Durban Container Terminal – Pier 2 - being the only exception. This terminal is already receiving specific management attention which includes the acceleration of the programme to renew its fleet of cranes. The age of the equipment in Durban is one of the biggest challenges that Transnet faces. On pipelines, Transnet is on track to replace the existing asset with a new one.

The trunk line, which runs from Durban to Gauteng, is complete and operational. The rest of the project will be finalised and commissioned by December 2013. “We recognise the role BB-BEE plays in the economic transformation of South Africa as it significantly increases the number of previously disadvantaged people who manage, own and control the country’s economy, as well as significantly decreases income inequalities,” Molefe said. He said though Transnet had consistently partnered with and supported BB-BEE-compliant partners and suppliers it is still in the process of finalising its BB-BEE and supplier development strategy. The strategy would link closely with Transnet’s supply chain to achieve sustainable and inclusive economic development, social stability and labour-absorbing economic growth. “I must admit this is long overdue. Supplier development, including BB-BEE, is a key focus of our procurement activities,” Molefe said, adding BB-BEE procurement spend had grown

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significantly over the past three years from R6.9 billion in 2007/08 to R13.5 billion for 2009/10. This was 40 percent of the total spend. The overall Transnet BB-BEE spend for 2010/2011 is R19.4 billion or 75 percent of the total. This was significantly higher than Transnet’s target of 65 percent. Its long-term goal is 70 percent. This is done while the company’s financial viability is maintained.. “Transformation does not exclude the need to perform. It is part of doing business,” he said. In line with its commitment to the New Growth Path (NGP), Transnet is focusing its skills development efforts on the training of artisans, engineers and engineering technicians. Last year, South Africa embarked on a new economic growth path in a bid to create five-million jobs and reduce unemployment from 25 percent to 15 percent over the next 10 years. The NGP aimed to address unemployment, inequality and poverty by unlocking employment opportunities in South Africa’s private sector. The NGP programme is a broad framework that sets out a vision and identifies key areas where jobs can be created. The growth path places employment at the centre of the country’s economic policy. Transnet planned to increase the number of trained artisans by an additional 500 a year for the next four years. It has 356 engineering technicians in the internship programme and the target is to recruit an additional 180 engineers a year. “We plan to increase the number of trained artisans by an additional 1500 in 2012; we are targeting an annual intern intake of 1500 learners focused on marine rail and cargo programmes; and we are going to increase direct jobs by 2.562; over 300 000 indirect jobs,” Molefe said. “We’ll boost the female employee base by 25 percent. Our 55 000 colleagues are a key element of our growth and efficiency goals for the

COVER STORY

next five years.” The company has a comprehensive human capital development plan in place and has made a conscious decision to train more than its requirements for the benefit of the country. It has concluded a partnership with the South African National Defence Force (SANDF) to recruit artisans from the Military Skills Development System, the army’s two-year programme. “We believe that people who have gone through military training have the required levels of discipline to make a valuable contribution,” he said. The company has also concluded a partnership with the University of Witwatersrand (Wits) and is also investigating further opportunities for possible collaboration with international institutions to promote the development of sector specific skills. To address the skills gap at supervisory and coordination levels, Transnet has embarked on a Trainee Manager Programme that will be implemented next year. Also in line with the NGP, the company’s supplier development strategy strives to leverage off the planned infrastructure spend of R110.6 billion over the next five years. The intention is to support industry further by developing local suppliers and increasing skills development in a manner that is conducive to economic development. By focusing on local suppliers, the plan is to reduce its supply chain costs through improved operational efficiency, procurement localisation and by securing supply. This will be achieved through skills transfer and by investing in plant, which will enable local suppliers to provide products and services of the requisite quality. This will, in turn, result in reduced turnaround times of spare parts, job creation and an improvement in the service received from suppliers of operational components and equipment. In addition, the development of local suppliers will reduce exposures to foreign exchange rate

fluctuations, reduce reliance on imports and avoid capital leakage. “Our largest Competitive Supplier Development Programme (CSDP) contract so far is the procurement of 100 General Electric (GE) locomotives,” he said. “The contract is the largest CSDP transaction to date in South Africa, positioning Transnet as the leading state-owned company in CSDP execution. ”The total localisation value as a percentage of the total contract is 52 percent. This will include skills development to Rail Engineering and Freight Rail over a four-year period, localised assembly and investment in plant, purchasing of local content and services over a 10year period. But that is not enough. Molefe has been with Transnet for almost six months and has not seen any resistance to transformation on the basis of race. But he believes that for Transnet to occupy its place in the South African economy it needs to change how it works.

“We recognise the role BB-BEE plays in the economic transformation of South Africa as it significantly increases the number of previously disadvantaged people who manage, own and control the country’s economy, as well as significantly decreases income inequalities,” Molefe said.

This is the reason it has introduced a 100-day management plan, designed to ensure that the activities and performance of the Group Executive Committee (GEC) members are monitored on a regular basis. This is as per the mutually agreed key performance areas (KPAs) and strategic performance objectives. Each member of this committee is expected to perform in line with the company’s mandate and KPAs. They are required to provide guidance to their teams to allow employees in their respective divisions to improve operations by focusing on efficiency, productivity, customer service and safety. “I believe that the team is dedicated and is working hard to lead this company into the future,” he concluded. And it seems it is all systems go for transformation in the utility.

Volume 1 • 2011

CHANGE

rebranding

Images: Vodacom

hits SA

www.transformsa.co.za

CHANGE

The South African landscape has been hit with a series of transformation (rebranding) initiatives recently as companies started to review their own effectiveness and performance. This has been brought about by a change in market conditions due to the global economic meltdown. Written by Mzwandile Jacks

ompanies are not sure any more about their market share because competitors have revamped their business strategies to gain a chunk of the market. Changed market conditions, due to the global economic meltdown of 2009/10, have forced companies to change their game plans. Companies have realised that perceptions about them need to change so that they can be seen as modern rather than staid. “This is all in an attempt not to lose market share to the next competitor. These revamps have become part of the companies’ overall strategy,” a Johannesburg-based marketing analyst told TransformSA. TransformSA’s investigation found that rebranding went deeper than changing the logo. It transcended the companies’ culture and vision. Companies that have rebranded include South Africa’s biggest mobile operator, Vodacom, the second biggest short term insurer, Mutual & Federal, auditing firm, PwC. Vodacom chairman, Peter Moyo, said the company had completed one of the most momentous changes in its 17-year history with the familiar blue and green logo being replaced with a familiar red branding

adopted from Vodafone.Vodafone, the London-based mobile operator, increased its stake in Vodacom to become a majority shareholder in the South African operation. “There are obvious benefits to aligning our branding and leveraging Vodafone’s global presence. But for Vodacom the benefits and changes run much deeper than simply changing colour,” Moyo said. During the past financial year the board of Vodacom and its management examined how the group operated and how it wanted to operate. This meant bringing in an outside expert to review effectiveness and the performance of individual members. The review found that certain issues, such as succession planning, needed more attention. “On this score we have changed our approach to make sure a more robust process is in place,” Moyo said. Vodacom has developed a new code of conduct, which is aligned to Vodafone, which sets out Vodacom business principles and provides practical guidelines for employees. The management team took on an even more ambitious transformation programme during the year, examining organisational culture and identified Volume 1 • 2011

CHANGE

barriers to performance. They then mapped out a process to take the group from its current makeup to one that more truly represents wider society, especially in South Africa.

“This is all in an attempt not to lose market share to the next competitor. These revamps have become part of the companies’ overall strategy,” marketing analyst.

This led to the restructuring of the group’s executive committee. It now has seven functional heads serving the local and international operations. Vodacom CEO, Pieter Uys, said the reasons for the change run deeper. “We also needed to signal to our customers that the new Vodacom means sweeping changes across our network, customer service and value offering,” he said. “Likewise, our employees needed a tangible break from the past and a high-impact start to a new way of doing things.” Mutual & Federal recently launched a new logo, which excluded Table Mountain from the background. This was in view of the fact that the company had ambitions to grow beyond SA mountains, further into other African nations where its parent, Old Mutual has a footprint. Venturing into what used to be called the dark continent on its own shows that even the culture of thinking in the company has changed. Vuyo Lee, the executive general manager for brand, customer and transformation at Mutual & Federal, said the company had also learnt its old brand seemed to lack relevance for the younger market. With its new brand Mutual & Federal hopes to remain relevant with its existing client base and attract new customers.

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PriceWaterhouseCoopers (PwC) announced last year that its brand name had been formally shortened to PwC, to provide consistency and ease of use, as part of its brand repositioning. The new branding includes a simplified logo consisting of the initials "pwc" in lowercase, designed to be easier to use and better suited to digital and online use. “Our reputation is the foundation of our new brand and our brand promise reflects our commitment to further enhance the value we add through meaningful relationships," PwC Southern Africa CEO, Suresh Kana, said at the time. According to Kana, the repositioning of the PwC brand was a natural step in the firm's journey to remain the number one professional services network by adapting to the changing needs of clients and stakeholders in today's challenging markets. The firm has for some time been focusing on building deeper relationships with its stakeholders and better leveraging the PwC global network. "Success will lie in how well we manage to bring our brand promise to life," said Kana. "It is all about what our clients experience when we interact with them and what our people experience when we interact with one another.” “The brand encompasses what it's like to work with us, how we do business, and what we are good at. The ultimate aim is for PwC to become known by all its stakeholders for creating value."

ADVERTORIAL

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we assist in the transportation of immigration officials to and from various ports of entry including all international airports, that is, OR Tambo International, Cape Town International and King Shaka International. Our hands-on approach and an unsurpassed level of professionalism are what set us apart from other travel management companies in the industry. Our business owners have been known to get involved on an operations and management level on a daily basis. We are constantly striving to better our services and we pride ourselves in having a presentable and well-maintained fleet. Situated in Pretoria, Durban and Cape Town, we have a fleet of over 70 vehicles nationwide; ranging from entry level passenger vehicles to different carrier vehicles. Our drivers are well-groomed, punctual and experienced and they provide assistance and information freely and as required. Our services are available 24-hours a day, and we cater for emergency shuttle and VIP service after hours. Our business is represented nationally by dedicated, professional staff supported by the newest infrastructure and technology to ensure that we can guarantee you the finest service.

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TRANSPORT

GAUTENG

transport

vision

Gauteng’s MEC for roads and transport, Ismail Vadi, has the future of the Gauteng province’s road and transport system in his hands. As a province with South Africa’s biggest roads and transport network, Gauteng holds the key to resolving some of the country’s transport system’s teething problems.

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TRANSPORT

ome of the realities on South African roads and public transport system include potholes, traffic congestion, a lack of safety of taxis and trains, inadequate and unreliable public transport and taxi violence. As the country’s and the continent’s economic giant, Gauteng is also the biggest determinant of South Africa’s transport direction. And right now South Africa is not embarking on any path that could tilt the province away from its planned sophisticated and world class transport system, thanks to Vadi’s and his executive management team’s vision. Vadi and his team have not been sleepwalking ever since he was appointed to the position of Gauteng MEC. Because of his sound instincts and skills as a politician, Vadi has an amazing vision for Gauteng’s transport system.

use their cars to commute between Pretoria and Johannesburg.” Traffic congestion has been reduced by 20 percent between Pretoria and Johannesburg because of the introduction of the Gautrain line. This was in the first month of operation. “We are giving a world class service here,” Vadi says. There will be a direct connection between Johannesburg and Pretoria and infrastructure is already in place. It is expected that this line will be opened in the first quarter of next year. Another success story is Bus Rapid Transport (BRT), which is part of Gauteng’s integrated transport system. This system has been so successful that Ekurhuleni is working on its own BRT and this will be in operation in the next three years.

This has been evident when he talks about the successes of the projects that are already in place and his plans for the future. Since the first month of operation, Gautrain, the provinces flagship transport project, has seen more than 3.3 million people use its services since June last year when the OR Tambo International Airport line was opened.

25 YEAR INTEGRATED TRANSPORT MASTER PLAN

“The Hatfield-Rosebank line has been doing extremely well, with 750 000 using this service in the first month of operation,” Vadi says. “The monthly ticket on this line is R39.00. This means Gautrain is not only for the rich. We have seen all classes using this. We have also heard many civil servants say they are not going to

Mr Vadi has prioritised the designing of a 25-year Integrated Transport Master Plan (ITMP25) for Gauteng and established a high-level committee of experts to develop an ITMP25. Its mandate is to provide a short-term plan indicating more immediate steps to be taken to change the public transport landscape in the province,

which should be submitted to his office by January 2012. It also provides a long-term, 25year plan that will knit-in with the Gauteng Vision 2055 strategy, which should be handed to Mr Vadi’s office by March 2013. “The Integrated Transport Master Plan will serve as a road map to be followed, rather than merely an archival point of reference,” Vadi says. “My focus will be on the department’s road maintenance and construction programme, its public transport and logistics mandate, g-Fleet; Gautrain and the Gauteng Freeway Improvement Project.” The provincial treasury has allocated R6.2 billion to fund a broad range of programmes relating

The department wants to create a reliable, affordable, safe and accessible public transport system and a well-developed road and rail network for the efficient, effective and seamless movement of people and goods.

Volume 1 • 2011

TRANSPORT

Mondli Gungubele, Mayor of Ekurhuleni and Ismail Vadi

Airport to major highways. • Cayman Road Phase 2 - in Sedibeng that involves the tarring of Cayman Road as an access road to the “Eye of Africa” Development. In the current financial year, the Department has earmarked the following roads for upgrading:

to roads and transport, representing 9 percent of the total Gauteng provincial budget. The department has allocated just over R1.2 billion for its roads infrastructure and maintenance programme. This represents the most important of its programmes this year. It is commonly known that the Gauteng roads network has deteriorated over the past few years. This has been confirmed by the department’s Annual Paved Road Network

rural areas. A total of R6 billion has been allocated nationally for the project. The Gauteng province received just under R500 million to address the problem of potholes and preventative maintenance work. Through this project, the department aims to create at least 5000 job opportunities. In addition, this programme must help to provide capacity and empower small and medium and macro enterprises (SMMEs), particularly with youth and women-owned and controlled businesses.

“I am an optimist and do believe that these plans will be achieved successfully,” Vadi says. “The monthly ticket on this line is R39.00. This means Gautrain is not only for the rich. We have seen all classes using this. We have also heard many civil servants say they are not going to use their cars to commute between Pretoria and Johannesburg.” Assessment. The assessment for 2010 shows that out of the total extent of the provincial paved road network of 4248 km, 9 percent of the roads are in a “very good condition” while 27 percent is in “good condition.” About 33 percent is in a “fair condition” and 20 percent in “poor condition”. But 11 percent is in a very poor condition. S’HAMBA SONKE PROJECT AND JOB CREATION S’hamba Sonke is a central component of the plan by transport minister, Sbu Ndebele, to create jobs through road maintenance programmes in both semi-urban and

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IMPROVING ROAD INFRASTRUCTURE This year, the department will be completing the construction of the following roads: • R55 Phases 1 and 2 - this is an alternative road between Sandton and Pretoria via Laudium, which entails the upgrading of the road from a single to a dual carriageway, including the construction of two bridges and culverts. • K29 Phase 3 - Malibongwe Drive that entails the upgrading of the road from a single to a dual carriageway. This includes the construction of a bridge across the N14 and the associated culverts. This will ease congestion from Lanseria

• K46 - William Nicol Drive, which entails the upgrading of the road from a single to a dual carriageway. This road is a major linkage between Sandton and Diepsloot. • K15 - Phases 2 and 3, which involves the upgrading of Adcock Road between Dobsonville and Protea Glen. This road will ease the mobility from Soweto to Krugersdorp. • P126 – Pinehaven Interchange, which entails the construction of an interchange over the N14, including the construction of 3 km long approaches, culverts and two bridges. GAUTENG FREEWAY IMPROVEMENT PROJECT The Gauteng Freeway Improvement Project (GFIP) is designed to upgrade approximately 560 km of provincial roads. Phase A1 of the project has upgraded 185 km of the existing road network, largely through bonds issued by the South African National Roads Agency Limited (SANRAL). “I am an optimist and do believe that these plans will be achieved successfully,” Vadi says. Gauteng Department of Roads and Transport No. 41 Simmonds Street Sage Life Building Johannesburg Tel: 011 355 7000 Fax: 011 355 7305 www.roadsandtransport.gpg.gov.za

Saving Water, Saving Lives YARD WATER METER OVERVIEW

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The Intelligent Water Meter and the supporting Meter Management System (MMS) provides a revolutionary approach to Water Demand Management. The Intelligent Water Meter ensures signiÀcant water savings through consumption management and leak detection with the added beneÀt of no billing costs. Bad debt is reduced and the lower consumption contributes towards reduced demand on reticulation and treatment plant.

• Intelligent Meter options • Optional metered Lifeline Áow (40 ȳ/hr) when credit runs out • High air Áow detection and correction • Insensitive to lightning, freezing water, ambient temperatures up to 700 C, water hammer and dirt particles in water • Optional built in radio for AMR (no loose wires or antenna) • Arrears collection via User Tag (mode dependent)

COMMUNITY STANDPIPE OVERVIEW

The Community Standpipe Water Meter and supporting Meter Management System (WAS) is designed to offer a solution to the provision of water at communal water supply points. It requires low capital investment and can be used in both rural areas and informal settlements. One Meter can typically serve up to 40 households. The unit consists of a Class B multi jet water meter with electronic read out and built in Áow control valve. A patented valve system ensures extended battery life. The unit is meteorologically sealed and provides a high level of resistance to physical tamper and is immune to magnetic tamper. Should the meter become faulty, it can be replaced in the Àeld within ten minutes.

FEATURES

• Eight programmable tariff steps • Physical tamper resistant. Full encryption and copy protection • Immune to magnetic interference • Meter accuracy unaffected by sand particles • High air Áow detection and correction • Adjustable Free Basic Water • Daily consumption limit for water-scarce areas • Full calendar clock • Patented low power consumption system • Battery can provide 90 000 valve applications • Robust metal housing with security screws • Delivered fully assembled and pressure tested to 20 bar • SANS 1529-1 and SANS 1529-9 approved

HANDHELD VENDING UNIT OVERVIEW

The Handheld Vending Unit is used in conjunction with the Intelligent Water Meter and Community Standpipe. It provides the link between the Meter and the Meter Management System (MMS). A network of conveniently located Vending Units provides the customer with easy access to “point of sale” where credit can be purchased. Each transaction is supported by a receipt printed from a dedicated printer.

523 Church Street, Provisus Building, Arcadia, Pretoria, 0083, South Africa Tel: +27 12 440 9885 | Fax: +27 12 440 9751 Naphtali Motaung | +27 72 736 2995 info@lesira.co.za www.lesira.co.za

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56 MB internal data memory, LCD display Single membrane keypad with standard key functions Built in battery with battery charge-level indicator Charged batteries provide 8 hours continuous operation Re-chargeable from a 220V AC source using the supplied charger. A car charger can also be used • High level of security with password protection • Theft risk is low as only dedicated functions are provided • Weighs approximately 350 g • Supplied with dedicated printer • Optional increased internal data memory (up to 2GB) • Optional GPRS module for automatic real-time downloading of data and online transactions • Optional collection of capital repayments and service charges

(PTY) LTD

PROPERTY

property sector's

LOPSIDED

Images: iStockphoto

OWNERSHIP

www.transformsa.co.za

PROPERTY

South Africa’s property sector does not only lack transformation at ownership level but there is also no black representation at big companies. This means property ownership remains lopsided, allowing only for whites and rich foreigners, who are flush with dollars, to play a major role in this sector while blacks are left out of the picture. Written by Tiisetso Tlelima

ecause this is the state of affairs, South Africa’s property sector ownership will continue not to reflect the true demographics of the country. While some sectors have made considerable strides towards transformation, the property industry is still lagging far behind. The property charter, which was first drafted eight years ago with the purpose of cultivating an environment that promotes BB-BEE and fast-tracking transformation in the industry, is yet to be gazetted. The property sector has urged the Minister of Department of Trade and Industry (DTI), Rob Davies, to sign the charter into law so that it can be implemented. The property charter’s proposed transformation targets include achieving at least 25 percent black ownership and 10 percent black women ownership within five years. Once gazetted, the charter will monitor progress or lack thereof, and identify areas that prohibit transformation in the property sector annually. In the meantime, the industry is still largely run and owned by whites – commercially driven activities surrounding property including development, management and sales rest in white hands. “It’s one of those really embarrassing stories to admit, that you’re sitting

in an industry which unfortunately hasn’t moved that much in terms of transformation,” said Kgaogelo Mamabolo president of the South African Institute of Black Property Practitioners (SAIBPP). “The thing about transformation is that there are only certain people who are keen about it. You may find that a lot of them just don’t care. They don’t want it. Some people think that we think we are entitled.” Not only is there lack of transformation at ownership level, but there is also little or no black representation within big companies and black estate agents make up a meagre six percent. “The excuse that you hear all the time is that there are no skilled black people,” said Mamabolo. “But none of those people who’ve said those statements have ever come to SAIBPP and said; do you have somebody like this?” Big business owners would rather give bursaries to university students than develop, mentor and invest in the existing market. “There’s very little investment in skills development and limited commitment to workplace training and the sector is not doing enough to promote the growth of sustainable enterprises” said Property Charter Council Chairman, Saul Gumede.

in ownership. They are also less represented in control, management and in the professional skills sector, according to Gumede. The popular view from the private sector is that black property practitioners are only good for getting government deals and government leases, and therefore, are unable to compete in a commercial environment. In addition, to the industry’s reluctance to transform, government has also played its part in stalling transformation efforts in the industry. Since the property charter was first drafted in 2003, the department of public works has had four different ministers and each of them want to make changes to the policy. Winning government tenders, which is usually seen as the easiest way for black property professionals to break into the industry, has proved to be a challenge for emerging enterprises because of fraud and corruption. “You find that the same names are always used, and the same individuals get opportunities,” explained Mamabolo.

Gender equality is another important issue that the industry has not addressed.

However, the department of public works tried to put a property incubator programme in place which aimed to identify, develop and mentor the youth by helping them with building acquisitions and maintaining and leasing buildings.

Black women remain under-represented

Access to financing is undoubtedly

Volume 1 • 2011

PROPERTY

“It’s one of those really embarrassing stories to admit, that you’re sitting in an industry which unfortunately hasn’t moved that much in terms of transformation,” Kgaogelo Mamabolo. the biggest obstacles facing new entrants in the property sector. “There is insufficient financing to address the skewed patterns of ownership,” said Gumede. “This situation is exacerbated by legal and administrative obstacles to property ownership. Commercially, direct property ownership is dominated by institutional investors, large private owners and collective investment schemes.” Purchasing property is by its nature very expensive. A single building can cost millions and a shopping centre billions. “Say the bank loans you money at the value of 20

percent, you have to come up with 30 percent and black people don’t really have trust funds or access to networks of people with lots of cash,” explained Mamabolo.

to convince them of its potential to growing the economy.”

Therefore, it’s difficult for aspiring black property owners to raise the money to be able to participate in a transaction.

But, it’s not all doom and gloom. There have been a few success stories in the industry including a black-owned company called Motseng Properties which is managing about R8 billion worth of properties.

Their white counterparts have a higher chance of getting a loan from the banks because they have the money and a track record. In addition, because of the recent global recession, banks have become stricter and more cautious when lending money. The sector has struggled to find

“That comes from a single fund that decided it’s going to support black business,” said Mamabolo. “Without that I don’t think they’d be saying they have R8 billion because nobody from established business is scrambling to use them. You know it’s tough, it’s a matter of I’m going to use people I’ve

alternative sources of funding for emerging black entrepreneurs.

always known.”

“Unfortunately institutions such as the IDC and NEF have never looked at property as a fundable industry,” Mamabolo said. “I think part of the reason is that they don’t understand it. “But we are engaging with them now and they are showing interest. We believe we need to give them more evidence of what this thing is all about. We need

Changing the mindset of established business seems to be one of the major challenges to transformation within the sector. If you can change people’s mindsets, that will make transformation easier because more people will come forward to help you, Mamabolo added.

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BVA 105

PERSPECTIVE

BACK

on agenda

The BEE Advisory Council has had to withstand a huge criticism since its launch, with many detractors saying it is an impotent body with no agenda of its own. But it turns out it has done some important work since its launch, if anything BEE experts have said is to be believed. Written by Mzwandile Jacks

Johannesburg-based BEE expert told TransformSA the much-vaunted advisory council - launched in late 2009 – had brought back broad-base black empowerment (BBBEE) to the South African political agenda. This bucks the general trend in the BEE circles, with most BEE practitioners criticising the council and describing it as a useless talk shop which reworked old positions during its quarterly meetings with President Jacob Zuma. As government launched SA's first advisory council on broad-based black economic empowerment, expectations of an effective empowerment strategy rose, along with sceptism about the council's ability to fulfil its broad mandate. At the council’s first sitting in early 2010, deputy president Kgalema Motlanthe acknowledged that SA’s empowerment strategy had mixed successes. “The speed of economic transformation, we have to admit, has been frustratingly slow at times,” he said. And the “broad-based” element had been elusive. He conceded that empowerment in the first 15 years of democracy

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had been “a story dominated by a few individuals benefiting a lot”. Motlanthe’s admission of the limitations of government’s empowerment strategy has been welcomed by analysts and opposition parties. The link has been made repeatedly between SA’s inability to transform quickly and the brake that this will continue to be on economic development. Ajay Lalu, the CEO of Black Lite Consulting, told TransformSA that returning BB-BEE to the political agenda was critical because during the global financial crisis BB-BEE took a back seat. “The advisory council has recognised that fronting is a major concern and needs to be eradicated and criminalised,” said Lalu. “It has also now initiated the process of reviewing the codes of good practice which are in need of a major overhaul.” It had also introduced the alignment of the Preferential Procurement Framework Act with the BEE Codes and has introduced IRBA with its members accredited verification agents. Amid high expectations, President Zuma named members of the council in late 2009 after a twoyear delay. The 19-member council first met in

February 2010 but critics believe its quarterly statements have masked fierce battles fought by council members behind the scenes. These battles have been fought to save the BEE paradigm from being overridden by an “ultraleftist” agenda, led by Trade and Industry Minister Rob Davies and his Economic Development counterpart, Ebrahim Patel. “My view is that the council has achieved some milestones but far from what the public were expecting,” Lalu said. “This is due to the fact that it does not have a full time secretariat nor does it have any budget to commission research or employ consultants.” With further capacity and resources it would be more effective and therefore government needed to address the advisory council’s mandate and its support structures. “I think that we need to create a BEE Authority along the lines of the Competition Commission which will monitor progress, investigate fronting and provide information to the public on the state of BB-BEE in SA. This will feed into the Advisory Council and the DTI as regulator,” he said.

Images: iStockphoto

CSI

hese companies are moving away from the corporate social investment as it is generally known by South African public. They are practically making it possible for racial groups to work together without being suspicious of each other as it has been the case despite the all-important race elections in 1994. A Port Elizabeth-based German multinational, Schaeffler South Africa, has launched what is called The Rainbow Nation Club (RNC) which aims to move towards racial integration in the workplace and uplifting the lives of many of its under privileged workers and people.

Cause for

JOY

For South Africans wondering how their country will earn its keep in a world that is fast-moving to nonracialism, some companies offer cause for cheerfulness. Written by Mzwandile Jacks

This is very critical for the process of transformation given the fact that many South African companies are still divided along racial lines in the workplace. There is no doubt that South Africans of all races still do not trust each other in the workplace with whites saying they are being discriminated against by affirmative action. And black people on the other hand believe that white people still occupy positions of influence in most companies. Launched 18 months ago, the Schaeffler initiative provides short and long-term relief to 500 workers stationed at the PE plant. The plant makes clutches which are supplied to independent aftermarket with 60 percent of production volumes exported to other countries. Len Terblanche, the company spokesperson spearheading this project, told TransformSA, this initiative began because he strongly believed that the solution for this country’s problems lied in building a unified nation as envisaged by Nelson Mandela with his Rainbow Nation vision. “If South Africans stop dwelling in the past and concentrated on building

relationships, everything might fall in place as it did when the Madiba Magic was unfolding,” said Terblanche, referring to the role former president Nelson Mandela played in reconciling the polarised South African nation. The Club has encouraged other companies to join and has since succeeded in signing up several company managers to the club’s membership, which adds to their existing members. All 500 employees include workers that are members of the worker federation Cosatu. Employees have received a lot of support. According to Terblanche, the head office of Schaeffler Gruppe in Germany, the parent company, has committed to pledging R3 million toward the Rainbow Nation Club and its activities. Sponsorships at non-governmental organisations across the city, including Kwazakhele High School, ACCV Khayalethu Youth Centre, SOS Children’s Village, and 120 schoolchildren from Veeplaas who received new uniforms have been awarded. “Through the launch of the RNC at Schaeffler, we believe it has removed the 'them' and the 'us' and made win-win decisions possible,” Terblanche said. “We are truly passionate about this initiative as we believe that something needs to be done about the poverty in SA and the inequalities that still exist. We should make nation building a top priority and convince our leaders to embrace once more Madiba’s legacy of a unified Rainbow Nation.” This should include political, business and civic leaders. South Africans should be encouraged to make up-liftment of the underprivileged a priority. “We all have to realise that the government alone cannot solve this and that we are all part of the solution,” he said.

Volume 1 • 2011

SECTION PERSPECTIVE TITLE

BEE highroad

South Africa is not about to walk out on black economic empowerment (BEE) and broad-based BEE anytime soon. Opponents of BEE may dream, but in the near or medium term, no South African government will risk a BEE withdrawal in cold blood amid widespread talk that this policy has failed.

Images: iStockphoto

Written by Mzwandile Jacks

www.transformsa.co.za

SECTION TITLE PERSPECTIVE

his policy is what sets South Africa apart from other African countries that are currently at war with themselves over scarce resources which have not been distributed equitably.

part of BEE has seemed elusive. In the main, the story of black economic empowerment in the last 15 years has been a story dominated by a few individuals benefiting a lot."

Rubeshne Gobardan, a senior manager for advisory at auditing firm, Ernst & Young, states confidently that multinationals seeking to start businesses in South Africa are fully aware of the necessity for this policy and are not discouraged.

Adding that broad-based economic empowerment was intended to benefit all sectors of the previously disadvantaged population and not a few individuals only, Motlanthe urged people to look at empowerment more broadly, "beyond business deals and shareholding in companies".

This, according to Gobardan, is an indication that the BB-BEE and BEE in general have not failed. This is a critical statement because critics of BBBEE and BEE have always been of the view that this process would prompt capital flight from South Africa. “In our interaction with these multinationals, they are fully aware of the necessity for BB-BEE compliance in order to remain sustainable,” Gobardan told TransformSA in an exclusive interview. “Instead of BB-BEE being a deterrent, they embrace the intention of the legislation and seek to ensure compliance by incorporating it as one of government’s pre-requisites and ensure that it is appropriately addressed.” Last year, it was reported that BEE – which is a key government policy intended to redress South Africa’s economic imbalances of the past had failed. This was after Kgalema Motlanthe, the deputy president, delivered the inaugural speech at the first meeting of the BEE Advisory Council. The council was launched by President Jacob Zuma in 2009 after delays of more than two years. "The percentage of black-owned companies registered at the JSE is disappointingly low," said Motlanthe at the time. "We also have to admit that the 'broad-based'

"We have to think creatively about ways in which we can increase the extent to which communities, workers, co-operatives and other collective enterprises own and manage existing and new enterprises and increase their access to economic activities, infrastructure and skills training." He emphasised that the impact of broad-based BEE, particularly the big deals, needed research. During that meeting of the council, members including the former CEO of Business Unity South Africa (BUSA), Jerry Vilakazi, talked about investigating the sustainability and structure of BEE deals, because some did not seem to change the lives of the poor.

have to be empowered with enough resources to deal with this," Vilakazi said. Gobardan admitted that nothing much had changed for the masses in South Africa as they were still being marginalised. “This has seen the advent of a new resistance which is now against the elite irrespective of colour and creed - as being evidenced in the attacks against political figureheads,” he said. But the BEE legislation had created the awareness with companies selecting initiatives to be undertaken to achieve a desired contributor status level. “Therefore, we do not believe BEE has failed, as it remains a key driver of a business’s sustainability within South Africa,” he said. South Africa was still faced with the statistics of about 90 percent of the population of South

“Therefore, we do not believe BEE has failed, as it remains a key driver of a business’s sustainability within South Africa,” Gobardan said.

Analysts at the time said this could mean the end of BEE deals where performance was tied to the performance of the share price. Most of these deals collapsed when the global financial crisis kicked in two years ago.

Africa being represented by African people while they only occupy 25 percent of the cumulative top management positions in the country.

Because they were financed through special purpose vehicles (SPV), BEE partners ended up in debt when the financial markets slumped.

“Until these statistics talk to each other, BB-BEE policy remains a key medium, which will address this disparity,” Gobardan said.

The SPV structures have attracted widespread criticism from BEE practitioners and observers in the past two and a half years.

“We believe that should government seek to discard this legislation questions will be raised as to whether they believe that equality has already been attained? Also this policy does appear to be something separating us from the political instability that presently exists within other countries in Africa.”

"Most members of the council raised their concerns about the appropriateness of these structures. We discussed that the council would

Volume 1 • 2011

FILM AND PUBLICATION

Cause for satisfaction Looked at in one way, the Film and Publication Board (FPB) has cause for satisfaction. This is attributable to the transformation of the rigid apartheid’s directorate of publications to the more democratic FPB. Written by Mzwandile Jacks CEO of the Film and Publication Board – Yoliswa Makhasi

ew weeks ago, the press ombudsman ruled in the FPB’s favour after the board complained about the graphic sex pictures published on the front page of the Sowetan newspaper. The press ombudsman said the Sowetan newspaper's publishing of prominent pictures of two officers having sex on duty was not in the public interest. The ombudsman said the newspaper need not have published the pictures so prominently and explicitly to get its message across because there was no 'public interest' to do so. He ordered the paper to apologise on both its front and second pages. The pictures showed an officer from correctional services and a policewoman having sex in a hospital. Yoliswa Makhasi, the CEO of FPB, said it was wrong for the publication to do so because the Sowetan is a family newspaper. “When they did that, they exposed children to pornography,” Makhasi said. The FPB is a statutory body established by the Films and Publications Act of 1996. It replaced the Directorate of Publications which operated during the apartheid era. Its task is mainly to classify films,

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FILM AND PUBLICATION

videos, DVDs, computer games and certain publications for their suitable age viewership and to provide consumers with enough information to make informed choices about what children should or should not see. The FPB classifies all film material distributed in South Africa, except that shown on TV. Broadcasters have their own regulatory body. Its vision is to be a credible and visible content-classification authority and its mission is to regulate the media environment through the classification of content. This would be done by maintaining relevance to the values and norms of South African society through scientific research. It would balance the right to freedom of expression with an obligation to protect children from exposure to potentially disturbing, harmful and inappropriate materials. It would protect children from sexual exploitation in media content in order to educate the broader South African society to make informed choices. Makhasi said the board during the apartheid government was more about banning and censoring material they deemed not good for public consumption. “But we look at the merits of a particular case and give advice,” she said, adding they do not resort to censoring. FPB is intolerant to irresponsible broadcasters and distributors of content who show little regard for the protection of children. The FBP is against those who use the rights and freedoms enshrined in the constitution to further degenerate the morals and values of the caring society South Africans seek to attain. It recently warned e-TV and other broadcasters and channels to carry a moral responsibility to protect children and abstain from broadcasting content that may be deemed to be detrimental to children. Makhasi said: “The FPB will mobilise support… to ensure we close all space for those who have a disregard for the protection of children and minimise heart-ache and panic amongst parents.” Makhasi had been encouraged that the courts in South Africa were beginning to treat those accused of sexual crimes against children, especially child pornography, with a heavy hand. She has warned those involved in the

creation, possession and distribution of child pornography of the seriousness of the crime. Child pornography images were part of a cycle of child sexual abuse and exploitation. According to the amended Films and Publications Act, child pornography images are defined as any image or description of sexual conduct involving persons under the age of 18 years. FPB believes child pornography images are not a victimless offence, as some have argued. “Every child abuse image is evidence of the commission of a serious crime. Apart from the child victim, parents and relatives are victimised as they suffer the knowledge of the abuse of their child,” FPB believes. “This activity therefore, has far reaching implications socially.” In addition to various child protection initiatives, the Films and Publications Act has been amended to make the investigation and prosecution of child pornography offenders more effective. According to the Act, it is also an offence to possess, create, produce, distribute, import, access, advertise or promote child pornography images. Each of these acts carries a maximum penalty of 10 years imprisonment. Failure to report knowledge of child pornography images to the police is also an offence. It is also an offence to expose children to pornography. The amendments have brought far-reaching jurisdictional implications. If one commits any of these acts related to child pornography outside South Africa, they may still be prosecuted when they return to the country. Mmapula Makola, the Chief Operating Officer of FPB, said, in terms of the Act, the board was required to publish guidelines used to determine what is disturbing, harmful and threatening to children and to advise the viewing public about such images and scenes. The FPB has the classification committee whose members are required to view every film to be distributed in South Africa to ensure that the classification decision is based on the law and accepted community standards of tolerance in terms of religious and cultural diversity.

“We look at the merits of a particular case and give advice,” she said, adding they do not resort to censoring. “The classification of films and interactive game products remain the main activity of the board, both in terms of workload and income earned from industry tariffs,” Makola said. “All members of the public who write to the board to complain about film classification decisions or who give the board general feedback on the guidelines use for classification receive replies to their correspondence.” Only pornographic publications needed to be passed by the FPB before they were released on the market. The board does, however, deal with complaints received from the public regarding specific publications. But she was

“When they did that, they exposed children to pornography,” Makhasi said. quick to say parents were the ones that played a critical role in making sure that youngsters are not exposed to the subversive material. “Parents must be able to enforce some of the rules. This will make children know what is wrong as soon as they step out of the house,” Makola said. Film and Publication Board 87 Central Street Houghton 2041 TEL: 011 483 0971 FAX: 011 483 1084 Email: information@fpb.gov.za www.fpbprochild.org.za

Volume 1 • 2011