Mining Charter Update

South African Engineers’ and Founders’ Association

30 November 2018

SAEFA’s Engagement with the Department of Mineral Resources regarding the Broad-Based Socio-Economic Empowerment Charter for Mining and Metals
The SA Engineers and Founders Mining Charter Task Team, comprising Clayton Anderson, Ross Williams, Glen Rebello, Detlev Borner and Jaime Goncalves, was set up in May 2018. Its purpose was to address member concerns around the proposed changes to the Mining Charter.
There were engagements with the Department of Mineral Resources (DMR) in May 2018 and again in August 2018 around the following issues:

  1. Better alignment between the goods and services procurement targets: the rationale for this request was that many member businesses provide after-sales services to their own and similar product sets at respective mining companies.
  2. A clearer definitions of “localisation” and “services.”
  3. Consideration is given to SAEFA’s proposed targets under Section 2.2 Procurement Mining Goods, subsection c. Services:
    1. 30% of Services from Black Owned companies
    2. 10% of Services from Black Female or Black Youth Owned companies
    3. 45% of Services from BEE compliant companies 

In conclusion, this proved to be a most worthwhile exercise. The input from the Task Team was well received by the DMR, which stands us in good stead for future engagements on issues relating to our member businesses. It also provided an opportunity to highlight the challenges faced by SME’s in meeting BEE targets in the current climate. Procurement targets that are too rigid would have a negative impact on business and would therefore adversely affect jobs in the sector. The DMR’s acknowledgement of the SA Engineers and Founders’ position was important.
A key finding was that after-sales services relating to supplied goods would actually fall under the goods procurement spend, and not under services spend as initially thought. The main elements of the 2018 Mining Charter appear in the summary from RMB Global Markets Research, if you would like a copy of the summary please contact the administrator.
Thank you to the members of the Task Team for the time and effort they put into this project.