Structure• Background and Context of Transformation
• Summary of Status of Mining Pre-1994• Evolution of the Legislative Framework for Transformation in
the Mining Industry – Post 1994
• Observations and Challenges
• Conclusions
Background and Context: Status of Mining Pre-1994
Dominated by few companies – Mainly six big companies (AAC, Gold Fields, Anglovaal, JCI, Rand Mines and Gencor) They owned and hoarded most of the mineral resources of the country
Black people were historically excluded from meaningful participation
Majority of the mineworkers were housed in single sex hostels/ compounds
Migrant labour system was an integral part of the industry
Background: Evolution of Transformation – Post 1994
The Journey of Transformation began with the Green Paper and White Paper on Minerals and Mining Policy. This requires that the industry be transformed in terms of:
1. Ownership and Management– Deracialisng of business ownership– Workers being empowered through ESOP’s, and meaningful participation in management of SA
mines
Background: Evolution of Transformation 2. On people and environmental Issues: It is required that
the following be addressed: – Mine Health and Safety– Human Resources Development– Housing and Living Conditions, and Migrant Labour– Downscaling.
Background: Evolution of Transformation Policy was translated into Legislation through the, MHSA and
MPRDA, which provided for;a) State custodianship of the country’s mineral and petroleum
resourcesb) Equitable access to South Africa's mineral resources c) Expanding opportunities for HDSA’s to enter the industry
d) Development of the Mining Charter i.t.o. sect.100 of the MPRDA
Background: Evolution of Transformation
The Mining Charter has 9 elements – covering critical aspects of transformation, including Ownership – an element that caters for ESOPS
Observations and Challenges
9
Element Observation/ChallengesOwnership • Current Situation:
• No new mining right is granted without 26% ownership in place
• There are a nuber of new companies that emerged e.g. ARM, Mvelaphanda, Exarro, UMK, Makau, Kalagadi Manganese, Sekoko, Shanduka, Holgoun, Kuyasa coal, Continental coal etc.
Observations and Challenges
10
Element Observation/ChallengesOwnership Challenges resulting in slow pace of transformation
• Quality of most transactions remain a challenge• Number of transactions under water due to debt levels• Lack of sustainability of most transactions due to lack of access to
capital • ESOPs and community schemes are heavily indebted • Most deals include or indicate women but there are concerns about their
active participation• Youth participation must be accelerated• The notion of “Once empowered always empowered” will undermine
what government is attempting to achieve
Observations and Challenges
11
Element Observations and challengesHousing and living conditions of workers
The situation is currently in four forms:• Some companies have achieved the target of conversion of
single sex hostels and implemented housing development programmes.
• Some companies are way behind schedules• Some have converted hostels but still undermined human
dignity – poor quality structures/accomodation • Living out allowance (LOA) present a challenge and needs to
be addressed by stakeholders.
Observation and Challenges
12
Element Observations and challengesProcurement and enterprise development
Some HDSA suppliers have core procurement contracts but there is a long way to go.
• Still a tendency to allocate non core procurement such as catering , entrance guarding, access control to BEE.
• Tendency to procure imported goods through local BEE does not support the local manufacturing interests of the country.
Observations and Challenges
13
Element Observation and challengesEmployment Equity
• There is definitely an increase in number of Black Mine Managers
Challenges • Insufficient number of Blacks and women occupying strategic
positions • Few if any Black CEOs of globally operating mining companies • HDSA are often given positions that have weak authority• Tendency of Reversing the gains made in RSA by importing skills
and not developing these locally is not helpful
Observations and Challenges
14
Element Observation and challengesHuman Resources Development
• Training programmes are made through SLPs and reviewed every 5 years
However, • It is important to have clearer and sustainable programmes in
place• ABET should be linked to future HR developmental plan• Bursaries should focus on local community development and
mine skills.
Observations and Challenges
15
Element Observation and challengesMine Community Development
• One of the biggest challenges in the industry – However, there are some good practices
key challenges relate to: • Fragmented contributions by mines to local socio-economic
development - coordination needed• Size and impact of some of the socio-economic projects are a
problem• Alignment of SLP with Integrated Development Plans needs
to be improved and aligned to town planning –strong partnership is required
ETHRIDGE PRIMARY SCHOOLBIZANA –S&L Plan Projectlaunched by His Excellency, President Zuma on 04th October 2013
Observations and Challenges
18
Element Observation and challengesSustainable Development
• It relates to the implementation of approved EMPs – there are good practices but there are “apple”
• Implementation of tripartite action on health and safety is monitored every two years – the Health and Safety Summit later this year will be assessing progress
Challenges:• Need to ensure that the industry moves to concurrent
rehabilitation should take place• Bad “apples” should be removes. Need to address
environmental legacies of the past - acid mine drainage is a typical example
Observations and Challenges
19
Element Observation and challengesBeneficiation
• The biggest challenge on beneficiation is iro downstream fabrications and maximizing value of South Africa’s minerals
Conclusions
The Mining Charter can still be used as a tool to transform the industry
• Mining Charter is imbued with a scorecard to self assess and report on progress.
• Assessment of level of compliance is ongoing • Key to success of Mining Charter and future for
transformation is in enhanced partnership amongst stakeholders