DEPT OF PUBLIC ENTERPRISES EMPOWERMENT PRESENTATION TO THE
DEPT OF PUBLIC ENTERPRISES EMPOWERMENT PRESENTATION TO THE PORTFOLIO COMMITTEE ON PUBLIC ENTERPRISES 23 AUGUST 2006 1 Content Guiding principles and legislative imperatives DPEs strategic intent Transformation in DPE Women in SOE boards Transformation in SOE Eskom Alexkor Denel Safcol SAA Transnet 2 Guiding principles and legislative imperatives Legislation Constitution Public sector Preferential Procurement Act Black Economic Empowerment Act of 2003 Skills Development Act Employment Equity Act King II Lever Quarterly and Annual Reporting Shareholder Compacts Corporate Plans KPIs and Targets SOEs Policies Social Responsibility Drivers Social Empowerment Eskom, Denel Transnet, Safcol Alexkor SAA PBMR Economic Empowerment 3 DPEs strategic intent
Gender empowerment fundamental hence it is fully integrated into the activities and structure of DPE In respect of SOE we facilitate equity transformation through: Directing the strategic direction of SOEs on Transformation Board Appointments Signing of annual Shareholder Compacts Monitoring implementation of national policy of gender equity and BEE Setting of KPIs through Corporate Plans Quarterly and annual reporting With regard to our own programmes, the Properties sub-programme of the Joint Project Facility Unit contributes directly to Broad-based Black Economic Empowerment (presentation to follow) 4 Transformation - DPE 5 Transformation - DPE GENDER EQUITY 38% 62% MALE FEMALE 6 Women in SOE Boards 2002 - 2006 8 6 2002 Female 4 2004 Female 2 2006 Female 0
Still a challenge to secure women board members but we are working towards 50% 7 Transformation - Eskom Gender Development Framework Diversity Procedure Workforce Suppliers AA Policy Gender Policy Disability Black suppliers W.O. B PWD Customers Diverse customers Penetrating new markets Community Esdef Directives Sexual harassment Flexi-time Policy Mentorship Policy Programmes Talent Management Job enrichment & rotation International exposure Coaching Worklife programmes Women networking forum 8 Transformation - Eskom 30% 25% 20% African Female 15% Asian Female Coloured Female 10% White Female
5% 0% Total 2006 2005 2003 2001 1999 1997 Year African Asian Coloured Whites Total 1997 4% 1% 1% 9% 14 % 2006 13,5 % 1,5 % 2% 8% 25 % 9 Transformation Eskom (F Band)
35% 30% African Female 25% Asian Female 20% Coloured Female White Female 15% Total 10% 5% 0% 2006 2005 2003 2001 1999 1997 Year African Asian Coloured Whites Total 1997 3% 1% 1% 8%
13% 2006 19% 2% 3% 8% 32 % 10 Empowerment programmes - Eskom Management processes in place Targets Current and future to create clear understanding of long-term objective (intent) Employee satisfaction surveys Leadership effectiveness measurements Structured learning programmes supported by formalised mentorship and coaching Monitoring trends Staff turnover Salary scales Performance assessments EAP 11 Empowerment programmes - Eskom Work/life examples Appropriate flexibility of working hours Child-care facilities Tolerance of diversity Female roles (religion, home, social, business) Workplace logistics (safety clothing, bathroom facilities) Ergonomics (heights, heavy equipment) Health and wellness 12 Empowerment programmes - Eskom Universities
total:532 women 66,5% Technikons total: 301 women 77% Technical Colleges total: 206 women 74% 13 Preferential procurement - Eskom 2005-2006 Expenditure Target Without Coal Coal TOTAL Total BEE BWO Included* 10,918,449.0 1,695,753.0 3,839,000.0 14,757,449.0 1,695,753.0 * 18% of the BEE Target Eskom development foundation Fund targets projects driven by women, persons with disability and for poverty alleviation 14 Transformation Alexkor The vision of Alexkor Limited with respect to black economic empowerment and women empowerment is to: Employment Equity Ensure procurement of 25% from HDSA sources increasing in future years To focus on female empowerment to build capacity building for meaningful female participation in the local and mainstream economy This is in line with the BBSEE Charter for the South African Mining Industry 15 Transformation Alexkor Equity breakdown
African Male Female Indian Male Female Coloured Male Female White Male Female Total Disabilities Target for 2006/07 6% 25 2 0% 0 0 73% 250 78 21% 72 25 452 0 Actual as at 31/03/06 6% 23 1 0% 0 0 72% 231 67 22% 66 24 412 0 16 Transformation Alexkor EMPLOYMENT EQUITY AS AT 31 MARCH 2006 MALE OCCUPATIONAL LEVEL Top Management Senior Management Professionally Qualified
Skilled Semi Skilled Unskilled TOTAL NUMBER OF INCUMBENTS 2 5 14 74 212 105 412 AM 2 FEMALE CM WM 7 11 1 2 25 141 62 3 5 38 20 23 231 66 3 AF 1 1 CF WF
1 1 3 30 32 2 8 14 67 24 % OF DESIGNATED GROUP 100% 40% 64% 49% 91% 100% 84% 17 Empowerment programmes Alexkor The following programmes are in place for women empowerment and to address employment equity ratios Awarding and participation of women in shallow water and sea concession contracts Allocation of bursaries in mining related disciplines Placement of females on mentorship programmes Employment of females on learnerships in engineering trades Training of females as earth moving operators Preferential procurement; Of the R165.5 m spent in the 2005/2006 financial year, 55 % was directed towards small, medium and micro enterprises, BEEs and women owned enterprises 18 Transformation - Denel 1. Historical legacy of Denel Captured market South African Defence Force White, male dominated Very few women in engineering primarily secretarial, administration and support
2. Denel is committed to the development of historically disadvantaged individuals and women in particular to address historical biases 3. Denel has commenced with an organisational culture/climate survey in conjunction with Consulting Company Absolute Ndaba aimed at assessing current culture in respect of all facets of transformation within Denel. On conclusion of the survey, the results obtained will be used to develop strategies as well as an equity vision for Denel. The survey results will be available during October 2006. 19 Transformation - Denel Total number of employees per Occupational Categories as at 30 September 2005 Male Female Occupational Categories Total African Coloured Indian White African Coloured Indian White Legislators, senior officials & managers 52 24 6 276 30 8 0 19
1 Total Permanent Non-permanent employees Total Percentage 37.5 9 7.1 0.4 8 20 Transformation - Denel Gender equity 24% Females Males 76% 21 Empowerment programmes - Denel Centre for Learning and Development: The School of Business Leadership The School of Aerospace The School of Land Systems The Denel Youth Foundation Training Programme Skills Development Projects: Through eight sector education and training authorities Focus on Engineers, Scientists and Technicians External training within South Africa & Abroad External training in Nepad countries 22 Preferential procurement - Denel Financial 2001/2 period 2002/3 2003/4 2004/5 2005/6
Total Spend (Rm) 1,463 1,185 1,397 1,985 1,794 BBBEE 166.211 251.068 201.929 437.060 334.276 % 11.36% 21.19% 14.45% 22.02% 18.6% Women (Rm) Direct 17.260 Indirect 2.874 23 Transformation Safcol The SAFCOL Group is committed to supporting the policies and initiatives of Government. Black economic empowerment and the development of the second economy are key focuses. The following activities demonstrate the Groups initiatives :
The disposal of SAFCOLs subsidiaries and other businesses to third parties consisting of a share of BEE interests in line with Government policy. BEE is one of the criteria taken into account in the procurement policy of SAFCOL for services and products, and the sale of raw timber to processors. Funding earmarked for corporate social investment is spent on rural development and the upliftment of individuals and communities. The involvement of SAFCOL in the development of the BBBEE Forestry Charter. The increased impetus to implement employee share option plans in disposed subsidiaries. 24 Transformation Safcol Levels Top Management (F & E-Band) Senior Management (Upper D) Middle Management (Lower D) Techinical and Administrative Officers (C-Band) Administrative (B-Band) Production Workers TOTAL PERMANENT EMPLOYEES AS AT 31 JULY 2006 T = Target A = Actual Group Male / Female Sub-total White HDI Subtotal Male Female Male Female Male Female Male Female Male Female Male Female T 6 2 6
T 11 4 11 5 48 12 68 18 38 48 1710 500 2473 A 11 1 9 1 48 5 65 13 34 46 1337 236 1806 Disabled * Total T A 15 12 16 10 60 53 86 78 86
80 2210 1573 2473 1806 0 0 0 0 0 0 0 0 5* 0 0 0 5* * Already included in total Note: Target indicate levels that should have been reached at this stage to be able to comply with numerical goals by 2008 25 Transformation Safcol The organisation, because of its nature, is primarily male dominated with 83% of employees being male and 17% being female 26 Empowerment programmes Safcol An in-house training centre provides skills training to own employees as well as externally. The training is to the benefit of historical disadvantaged individuals and contractors. Annual training includes in excess of 4 600 people involving more than 12 000 person days. Auditing, mentoring and assistance are provided for emerging contractors (SMMEs). Bursaries are granted to employees, dependants and historically disadvantaged individuals to obtain academic qualifications. Current budget amounts to R1,3 million. A total of 35 current bursaries are being sponsored of which 24 are for historically disadvantaged individuals and females. Bridging classes and experiential training provided for candidates in respect of a variety of disciplines (scarce skills) e.g. :Forestry 21 Candidates Artisans 8 Candidates Administrative 9 Candidates Marketing 3 Candidates Wood Technology
2 Candidates ABET classes in progress at is centres to improve literacy levels. Current attendance is 376 learners. IEB exams (2005/6) Level 4 180 passed Level 1 3 205 passed. 27 Preferential procurement Safcol The percentage spent on procurement of forestry and related service contracts in respect of BEE and SMMEs are as follows :Table 1 : Black Owned contracts with Equity ownership in excess of 50% Capital intensive Contracts Labour intensive Contracts Percentage Rand value Target Actual 40% 32% 80% 48% Table 2: Contracts with Equity ownership of between 20% and 50% Capital intensive Contracts Labour intensive Contracts Percentage Rand value Target Actual 40% 45% 80% 95% In addition to the above the Groups main providers of goods and services are Eskom, Telkom and the major fuel companies. They all are BEE Compliant. 28 Transformation - SAA South African Airways is in the process of redefining its core business and revising its corporate plan Empowerment has always been a fundamental component of the SAA transformation agenda Established empowerment programmes include: Executive Development Programme Supervisory Training Leadership Development Functional courses Legislative courses ABET Airline Contact Center Management
Airfreight Handling Supply Chain Management The presentation will however only speak to the establishment 29 Transformation - SAA Total Employees: - PDI - White Females - White Males - TOTAL 2002 66%(4055) 19%(1173) 14%(889) 6117 June 2004 70%(4250) 17%(1065) 12%(745) 6060 Plan 2005 68% (4029) 18% (1167) 14% (878) 6074 July 2006 72%(4083) 16%(908) 12%(687) 5678 Plan 2005 7% (57) 2% (15) 90% (693) 765 July 2006 9%(68) 4%(36) 87%(700) 802 Plan 2005 51% (274) 20% (108) 29% (154)
536 July 2006 53%(289) 18%(99) 29%(165) 553 (NB: These figures exclude Technical and Pilots) Pilots: - PDI - White Females - White Males - TOTAL 2002 4%(32) 1%(12) 95%(728) 772 Management: 2002 - PDI 44%(202) - White Females 24%(108) - White Males 32%(147) - TOTAL 457 (NB: These figures exclude Technical and Pilots) June 2004 7%(53) 3%(27) 90%(729) 809 June 2004 51%(250) 21%(103) 28%(141) 494 30 Transformation - SAA 1. Permanent Employees - SAA Total Employees by race and gender per Salary Grouping as at July 2006 Asian (A)
M Black (B) F EXCO 1 Total % 9 M Coloured (C) F M Total (A+B+C) F 5 3 - 45 27 - M F White M Total F 6 3 2 -
55 27 18 M Total F 8 3 11 - 73 27 100 Level 2 (*Excluding EXCO members) Total 9 2 27 17 3 3 39 22 21 12 60 34 94
17 21 5 7 25 33 29 13 54 46 100 Total Excluding Pilots 191 282 1,197 1,565 373 541 1,761 2,388 1,387 944 3,148 3,332 6,480 Total % 3
4 18 24 6 8 27 37 21 15 49 51 100 Level 3 Total management Junior Personnel Junior Personnel Total % Pilots Total % Total 31 Transformation - SAA Management - Designated Groups - White Females - White Males 2002 June 2004 July 2006 44% 24% 32% 51%
21% 28% 53% 18% 29% Management - June 2004 Managem ent - 2002 White Males Whi te M al es 32% 28% Desi gnated Gr oups Designated Groups 44% White Females 21% Whi te Femal es 51% 24% Management - July 2006 White Males 29% White Females 18% Designated Groups 53% 32 Transformation - Transnet Transnet has embarked on a turnaround strategy focusing on improving efficiencies, reducing costs and adding value to customers and shareholders
The goal is to build a focused freight transport company, streamlining activities into freight rail, ports and pipeline As such EE data is presented as at 30th June 2006 for the core business units only namely: Spoornet Preferential Port Operations National Ports Authority Protekon Petronet Corporate Centre (including Transnet Foundation, Esselenpark and Transtel SS) 33 Transformation - Transnet EEA2 Reports as @ Jun 06 Male Female African Coloured Indian White African Coloured Indian White Top & Senior Management 104 26
50% black persons (6 African, 1 Indian) 57% black females (3 African, 1 Indian) No PLWD Substantial progress has been made with representation of black persons whilst the black female target has already been reached Charter: 5 year target (2009) for Top & Senior Management 70% black persons 35% (50% of black persons target) black females 3% all people living with disabilities (PLWD) Transnet Top & Senior Management (404): 61% black persons (158 African, 30 Coloured,60 Indian) 29% black females (54 African, 4 Coloured, 14 Indian) Information on PLWD specific to top/ senior management not available Current transport sector achievement: 27% black persons of which 20% female Charter targets not met yet BUT Transnet is very close to achieving the targets for black persons and black females; Transnet is ahead of current sector achievement 35 Transformation - Transnet The Transnet Group has a total of 48 116 employees of which: 79.29% are black persons (6825 African, 715 Coloured, 43 Indian) 14.10% are black females (307 African, 70 Coloured, 13 Indian) 0.22% are PLWD Transnet is already beyond the overall 2009 target for black persons but progress in relation to black females and PLWD is slow 36 Transformation - Transnet Professionals: 53.28% black persons and 18.52% black females Skilled: 47.77% black persons and 15.37% black females
Semi-skilled: 78.95% black persons and 11.95% black females Unskilled: 96.81% black persons and 4.98% black females Current Transport Sector achievement for professional & skilled employees is 50% black persons and 27% black females Transnet is making good progress regarding black persons across all levels but progress regarding black females across all levels is slow 37 Empowerment programmes - Transnet Charter sets an ongoing target of: At least 10% of payroll expended on skills development initiatives (includes 1% skills levy); 50% of 10% targeted at training of youth At least 5% of workforce increase in learnerships in 3 years Transnet achievement is not reported with reference to the target The Group has trained an average of 73.3% black employees 38 Empowerment programmes - Transnet Transnet Executive Women Development Programme & leadership programmes at three levels namely: Transnet Executive Development Programme Transnet Business Driven Action Learning programme (GIBS) Transnet Management Development Programme (Wits ) Transnet Emerging Leadership Programme (through Esselenpark & UNISA) 43 % of women at all management levels have participated in the leadership programmes over the last 18 months. 39 Empowerment programmes - Transnet The statistics below are based on the 2005/6 reporting timeframes: Business Unit
Number trained % Black Petronet 281 65 Spoornet 25 797 training courses 72.5 NPA (Head Office) 97 78 SAPO (Head Office) 82 78 40 Preferential procurement - Transnet Preferential Procurement: 5 year target (2009) 60% of discretionary spend to black owned and empowerment enterprises 30% SMME (incl. Black owned & empowerment enterprises Based on available information the total BEE spend is 42% Based on available information it appears that progress with attainment of the SMME target is slow 41 Preferential procurement - Transnet Procurement Spend Available
42% Transwerk Protekon Totals WBE value SMME value (all races) Total BEE value Total BEE % 42 Conclusion - Transnet Black Persons: Transnet has made substantial progress in achieving the 70% black persons Management and Employment Equity (EE) target; at all staff levels Transnet has already gone beyond the target Gender: Whilst substantial progress has been made in relation to the number of black females on the Board of Directors and Top/ Senior Management, EE for black females across all levels has not kept pace with the employment of black males Demographic representation: Transnet has generally made progress with its alignment to demographic representation but imbalances still exist this should improve as Transnet proceeds to attain its BEE targets PLWD: Transnet has made slow progress in achieving the 3% target Skills development: Whilst Transnet has made substantial progress with the training of black employees, its reporting format has to be aligned with the Charter target Preferential procurement: Whilst some progress has been made regarding the total BEE spend, progress with SMME spend seems to be slow; reporting on preferential procurement should improve and be aligned to Charter target 43
Way forward - Transnet Focus on the core business units in line with the one company, one vision philosophy Develop an overarching Employment Equity (EE) strategy to ensure consistency in approach, principles and implementation Develop a consolidated EE plan that will form the basis for the EE plans of all operating divisions Develop a group wide EE monitoring tool and score card to assess implementation and monitor accountability Completion of group wide strategy, EE plans and targets, by March 2007 44
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