While Trade and Industry Minister Dr Rob Davies has commended the release of the first baseline report for the construction sector, which focuses on the progress made on the implementation of a Construction Sector Code – a requirement in terms of broad-based black economic-empowerment (BBBEE) policy – he has expressed concern that BBBEE targets in the sector remain unachieved.

The Minister said on Monday that the report, which was released by the Construction Sector Charter Council (CSCC) last month, revealed that there was little participation by black people as owners in large companies.

In 2011, over 393 construction-measured entities showed less than 10% black ownership, while most of the large entities were hovering at around a 10% ownership level – far lower than the 25% ownership target.

“This means that black people in the sector are not participating as owners in the large construction entities,” Davies said.

He further highlighted that the report indicated a decreasing trend in the use of preferential procurement and skills development, particularly among the qualifying small enterprises (QSEs).

“If you look at the scoring between 2009 and 2013, there has been a decline on companies scoring on these elements, especially amongst the QSEs. This is worrying, as the survival of the sector depends on capacity building.

“[An unskilled labour force] means that the sector is basically in trouble and will not be able to grow. Both elements are a priority in terms of the amended BEE Codes of Good Practice,” Davies emphasised.  

He added that the baseline report would inform the process of alignment of the Construction Sector Code to the amended BEE Codes of Good Practice, which were scheduled to be finalised before the end of April next year.

“Areas in which the sector was not performing will be given more emphasis to build an integrated and prosperous construction sector,” Davies noted.

The department encouraged entities and associations in the construction sector to support the CSCC by ensuring that, on a yearly basis, they submitted their BBBEE compliance reports.

In addition, for accurate and complete reporting, the submissions to the CSCC should include information over and above that which appeared on a BBBEE certificate.

“This will assist in measuring progress with regard to transformation, not only in terms of BBBEE levels, but rather a comprehensive overview across all pillars, both quantitatively and qualitatively,” Davies remarked.