development through partnership - cidb home report 2003-2004.pdf · development through partnership...

Growth

Delivery

Performance

Capacity

Empower-ment

Annual Report 2003/2004of the

Construction Industry Development Board

the development framework

Construction Industry Development BoardTel: +27 (0)12 481 9030Fax: +27 (0)12 343 7153E-mail: [email protected]: www.cidb.org.zaPO Box 1027, Brooklyn Square, 0075Pretoria, South AfricaRegisters Helpline: 0860 103 353

development through partnership

ci bd

ci b is constituted to lead construction industry development in South Africa.

is for a regulatory and development framework that builds:

• The total construction delivery capability for South Africa's social and

economic growth.

• A proudly South African construction industry that delivers to globally

competitive standards.

is on:

• sustainable growth, capability and empowerment

• improved industry performance and best practice

• a transformed delivery environment underpinned by consistent and

ethical procurement practice

• enhanced value to clients and society.

drive this vision, united by common values, the ethos of effective

partnership and a “can do, will do!” commitment.

reflect our ownership of the development challenge.

The Construction Industry Development Board (ci b) is a Schedule 3A public entity established in

terms of the CIDB Act, 2000 to provide leadership to stakeholders for sustainable growth, reform

and improvement of the construction sector and the industry's enhanced role in the country's

economy.

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Our aim

Our focus

Our people

Our values

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C o p y r i g h t © C I D B 2 0 0 4

C h a i r p e r s o n ’ s Re p o r t

C E O ’s Re p o r t

C o r p o ra t e G o ve r n a n c e Re p o r t

A u d i t C o m m i t t e e Re p o r t

B o a r d A p p r o va l o f t h e F i n a n c i a l S t a t e m e n t s

Re p o r t o f t h e Au d i t o r - G e n e ra l

F i n a n c i a l S t a t e m e n t s

M e m b e r s o f t h e S t a k e h o l d e r Fo r u m

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Contents

Chairperson's Statement

Brian Bruce, Chairperson of the ci b.d

1 ci b - development through partnershipd

This third year of formalised construction

industry development has crystallised into

tangible action much of the great

preparatory work done by so many people over

the past seven years of both Task Team and Board

activity. The Construction Registers Service is a

significant milestone in creating a more regulated

industry for the sustainable benefit of all industry

participants and its broader stakeholder group.

The construction economy in South Africa is

performing at its best levels in more than a

decade. Investment into public infrastructure and

services has grown at a steady rate over the past

few years, offering increased levels of opportunity

to the empowerment and SMME sectors of the

construction industry. Historically lower interest

and inflation rates seem to be sustainable,

boosting private investment into the commercial

building and residential sectors.

Cement demand has reached record levels and

producers are considering a step-change in new

capacity investment for the first time in many

years. Building and construction material

suppliers in general are benefiting and for the first

time in more than a decade, are utilising more

than 50% of previous installed capacity.

But not all is working to gear the full potential of

our industry. The resources sector is suffering

from the strength and volatility of our currency,

forcing major cutbacks in capital expansion. A

resurgence in the Asian economies and China in

particular offers a competitive alternative to

industrial investment in South Africa. We are

challenged by our distance from global export

markets, and again by the capacity of our

transport infrastructure. An approach is needed

that addresses the collective consequence of

these factors to stimulate a greater appetite for

fixed investment into productive capacity.

Growth of construction remains pivotal to South

Africa's economic prospect and is an indicator of

progress. Our work of the past year has focused

on instruments to drive an enabling environment

within which construction industry growth,

twinned with empowerment, can be realised.

Growth of construction is equally pivotal to

Africa's economic progress and this vast

opportunity seems out of reach at present, with

most South African contractors reporting

difficulties with operating conditions and delayed

payments. Much of the work crystallised by cidb

2annual report 2004

Minister Stella Sigcau formally accepts the ci b's

SA Construction industry Status Report - 2004.

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over the past year has broad relevance for the

continent, including streamlined procurement,

governance and the management of

infrastructure delivery.

The Construction Industry Development Board

has proved its early capacity in leading our

industry and its stakeholders on a journey of

transformation. I take this opportunity to thank

my Board colleagues and the CIDB executive

team under the leadership of Spencer Hodgson

for the exceptional dedication they have shown to

our common objective of industry development.

All South Africans will benefit in time from the

work that has been and is being done.

Brian Bruce

CEO's Report

The Construction Industry Development Board (ci b)

completes the financial year ready to roll-out the

development framework envisaged in its founding Act.

The strategic priorities of the ci b 2003/04 business plan have

been realized thanks to the achievement of our growing

executive capacity and our partnership with industry and its

stakeholders. Board leadership has guided and continuously

tested progress against the principal objectives of construction

industry development.

In facing the challenges of the past year the process of

construction industry development has continued to draw on

the championship role played by the Minister of Public Works,

Ms Stella Sigcau, the leadership and people in her department

and in provincial public works and transport departments

around the country. Common objectives have underpinned

collaboration with leaders of industry, National Treasury,

government departments and development agencies. Their

support, advice and commitment have been instrumental at

pivotal moments of the industry development process.

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We are indebted to the many stakeholder organizations and

individuals who have invested time and experience to deepen

our understanding and to shape the development framework

and progress reflected in this report. Through partnership we

have moved the construction industry development process

from concept and strategy to the point of implementation that

marks our challenge for the year ahead.

With this objective we have concentrated on key

components of the regulatory and development framework that

will drive a convergence of stakeholder focus for sustainable

delivery, growth, empowerment, and improving capability and

performance of the industry.

Spencer Hodgson,CEO of the ci b.d

the development framework to drive “…a conver-

gence of stakeholder focus for sustainable delivery,

growth, empowerment and the improving capability

and performance of the industry.”

Key components of the framework delivered this

year

• Enabling Construction Industry Development

Regulations promulgated by the Minister of Public

Works and articulating the regulatory framework for

development progress.

• Development and piloting of the Construction

Registers Service that will now be rolled out to

drive improved performance, delivery, sustainable

growth and empowerment.

• Finalisation of a national procurement framework

to promote consistent procurement and delivery,

including

• Library of Procurement Best Practice,

• Code of Conduct, and

• Standard for Uniformity in Construction

Procurement.

• Finalisation of the Toolkit Delivery Management

System which underpins government's public sector

Infrastructure Delivery Improvement Programme for

roll-out in the year ahead.

• Publication of Construction Industry Indicators

to measure and reflect development progress by the

industry and its stakeholders.

• SA Construction Industry - Status Report 2004,

that crystallizes challenges, opportunities and the

strategic way forward.

Growth

Delivery

Performance

Capacity

Empowerment

convergence

of

focus


Over the past year we have continued to build an all-round

ability and to bed down standards of delivery and governance.

Once again we take pride in the unqualified Auditor General's

Report, which together with the year's output reflects a “can-

do, will-do!” ownership of the development and corporate

challenge.

Epitomising this commitment is our CFO, Nellie Pillay, who

retires for family reasons. She hands over to Amit Ramasar an

impeccable set of financial and corporate governance systems,

a capable team and a leadership contribution to the building of

ci b.

In our second full year of executive capacity, the

organization has taken up permanent accommodation on the

SABS campus. We are pleased to be able to share this facility

with our sister institution, the Council for the Built Environment

From the start of the financial year we were able to build on

a core executive team of 13 people, growing to 18 at year end.

Increasingly the executive has shouldered operational and

strategic responsibility, enabling ci b to respond to rising

demands on our service.

Internal growth continues to reflect the organisation's

resolve to ensure a representative make-up of management

and staff in terms of race, gender and skills. With over 80

percent black and 60 percent women, we remain well ahead of

the equity targets set out in our business plan. Our diversity

reinforces an all-round appreciation of the implementation

tasks ahead.

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Building our specialist capacity has required the executive

to stretch its conceptual understanding in a range of forums and

in the development and presentation of peer-reviewed papers,

both nationally and internationally. These have covered key

aspects of our development agenda including the role of

procurement and public sector delivery. A paper on client best

practice and sustainable construction received a best paper

award at the international conference on Knowledge

Construction in Developing Countries held in Singapore.

Among a range of focused capacity building activities was

the participation of three of our managers in the one-month

Construction Management Programme held bi-annually in

Stellenbosch. This intensive course consolidated their growth

and linkage to stakeholders represented on the programme.

Into the future we will continue with industry to promote the

role and relevance of CMP in shaping the leading edge

performance of constructors and clients.

Construction Management Programme (CMP)

This year the cidb's capacity building benefited from

involvement in the intensive one-month Construction

Management Programme (CMP) held bi-annually in

Stellenbosch. This premier development programme,

sponsored by the industry for construction executives,

ranks with the top international programmes of its kind,

and over the years has helped to shape industry leaders.

The 2003 CMP programme embraced a two-prong

focus on Construction Industry Development and

Construction Business Development.

ci b support to the programme included various

presentations by the CEO and Board members, amongst

whom are former CMP graduates.

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“I am pleased to say that the delegates from

ci b did the organisation proud with their input

during the CMP 2003."

Prof Fred Hugo

d “…the year's output reflects a 'can-do, will-do!'

ownership of the development and corporate

challenge.”

Outgoing Chief Financial Officer, Nellie Pillay, with colleagues Gladness

Moorosi, Astrid Swarts and the new CFO, Amit Ramasar.

Building CIDB

4annual report 2004

Building the regulatory platform

Primary effort over the past year has been directed at delivering

the regulatory platform that will enable ci b to implement the

development mandate entrusted to it by Parliament. This finds

expression in the new Construction Industry Development

Regulations.

Grounded in the CIDB Act, the enabling regulations were

published for comment by the Minister of Public Works in March

2004. Subsequent promulgation in June paves the way for

implementation of the Construction Registers Service and for

consistent and uniform construction procurement.

Government Gazette 26427 reflects the considerable input

of public and private sector stakeholders to formulate and refine

the conceptual framework for the Register of Contractors, the

Register of Projects and the Standard for Uniformity in

Construction Procurement. Reinforcing the regulatory

framework is the ci b Code of Conduct - also published during

the year.

The regulations have also been firmly embedded in the

Toolkit Delivery Management System, developed with National

Treasury to provide the basis for improved public sector delivery

and capacity building.

We are convinced that the newly published regulations will

drive a convergence in development focus by the industry and

its clients. The challenge ahead is effective implementation to

promote:

• enhanced infrastructure delivery,

• improved performance of industry and clients,

• sustainable industry growth, capability and empowerment.

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Our mandate: a regulatory and development

framework

cidb is a Schedule 3a public entity. The Board comprises

private and public sector individuals appointed by the

Minister of Public Works on the basis of their individual

knowledge and expertise. It is supported by a knowledge-

based organization that is committed to the development

objectives defined in the CIDB Act (38 of 2000).

The ci b's mandate is to:

• Provide strategic leadership to construction

industry stakeholders and develop effective

partnerships for growth, reform and improvement of

the construction sector

• Promote sustainable growth of the construction

industry and the sustainable participation of the

emerging sector in the industry

• Promote improved performance and best

practice of public and private sector clients,

contractors and other participants in the

construction delivery process

• Promote procurement and delivery

management, the uniform application of policy

throughout all spheres of government, uniform and

ethical standards including a code of conduct

• Establish the registration of projects and

contractors, and other suppliers, to systematically

regulate and monitor the performance of the

industry and its stakeholders for sustainable growth,

delivery and empowerment and for improved

performance and capability.

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Government Gazette 26427, Notices No. 692, 62, 63.

AIDS HELPLINE: 0800-0123-22 Prevention is the cure

Government GazetteStaatskoerant

REPUBLIC OF SOUTH AFRICAREPUBLIEK VAN SUID-AFRIKA

No. 26427 JuneJunie

2004Pretoria,


Development context

6annual report 2004

To both focus our work and shape a common understanding of

the industry's strategic direction, we have engaged the broader

strategic debate and the implementation environment.

Growth

All indicators and stakeholder perceptions recorded in Status

Report 2004 confirm our conviction that the construction

industry will need to double its output over the next 10 years to

meet rising demand and South Africa's objectives for economic

and social growth. This growth presents challenges to all

stakeholders in respect of employment, empowerment,

capacity, delivery and performance.

Employment

Engaging the job creation focus of the Expanded Public Works

Programme, ci b has commenced a process to declare best

practice guidelines for labour-based construction. Similarly we

initiated a review of the new regulations that promote client

responsibility for occupational health and safety.

Empowerment

In the context of the Broad-based Black Economic

Empowerment Act (BEE Act) ci b has aligned the potential of

the Construction Registers Service to underpin empowerment

in the sector. In response to a request of industry constituents,

we have engaged our capacity in support of the charter process.

Towards this process ci b commissioned a study on

empowerment progress, opportunities and challenges. It is

clear that significant investment prospects provide the potential

to deliver empowerment objectives.

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A key finding of the study captured in the Status Report

confirms a perception that stakeholders believe a shift is

needed from the current increase in number of enterprises to a

focus on sustainability, capacity and enterprise growth. With

this objective we have shaped the Register of Contractors and

its grading system to provide a framework for targeted success-

driven enterprise development and for monitoring and

promoting empowerment progress against targets that will be

established by government and industry in the Construction

Charter.

Capacity

The capacity challenge was raised at the November 2003

Stakeholder Forum and also emerged in the context of major

private sector projects, including minerals and mining. A study

developed by the National Advisory Council for Innovation

promoted debate on skills gaps and shortages in specific sectors

of the industry. ci b was called upon to draft a chapter on

Structural Issues Impacting on Capacity to Deliver Major

Projects.

This input for sustainable skills development highlights the

responsibility of clients and proposes a set of principles to

promote partnership for development. ci b has also called on

the industry to take ownership of the new skills training

environment and to invest in people.

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Client responsibility in enterprise sustainability

and skills

(Extract from ci b input to a study on industry skills and

capability)

Decades of declining demand and demand volatility has

led to a decline of specialist skills and capability within

the industry at management, supervisory and artisan

level. Linked to this, the procurement practices of major

clients focused on lowest price awards of contract have

driven the industry into unsustainable levels of com-

petition. This has resulted in the shedding of labour and

a reliance on labour brokers, who are not part of the

skills development equation.

ci b has advanced a set of principles to underpin the

role of clients, including the need to:

• Recognise that clients are the drivers of positive

change and that their delivery and procurement

practices shape the development and sustainability

of the industry

• Ensure that major projects are planned, scheduled

and procured with cognizance of the need to develop

and retain capability

• Recognise that win-win outcomes are the basis for

partnership and therefore ensure that client procure-

ment practices minimize waste and maximise the

use of existing capability by:

• promoting greater consistency in the procure-

ment process

• promoting value based solutions rather than

lowest price

• optimising the potential of the contracting sector

to innovate.

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Engaging the environment

“…the construction industry will need to double

its output over the next 10 years to meet rising

demand and South Africa's objectives for

economic and social growth.”

The Construction Industry Stakeholder Forum, 2003.

Delivery

We have also highlighted the positive impact that will derive

from major public sector reform initiatives and the roll-out of

the Toolkit Infrastructure Delivery Management system to build

public capacity.

In this context and in response to requests from the Eastern

Cape, ci b in cooperation with Coega Development Corporation

and the Rapid Infrastructure Development Agency (RIDA), has

mobilized technical capacity to support the provincial

government's drive to build delivery capability. Our input in

terms of the Toolkit and the new Framework for Supply Chain

Management and procurement aims at reinforcing the initiative

of the poorest province with the largest infrastructure backlog

and largest planned expenditure over the next five years.

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Phumelele Siphayi and Thuli Manana of SAWIC at the

Construction Industry Stakeholder Forum, 2003.

ci b workshop on the Register of Contractors in Limpopo. d

8annual report 2004

In November 2003, the ci b again convened the

Stakeholder Forum of over 80 delegates appointed from all key

sectors. Under the theme “A better industry for all!”, the

meeting was attended by Minister Sigcau and Deputy Minister

of Public Works, Rev Musa Zondi and reviewed ci b progress

and plans since the inaugural meeting in 2002.

Breakaway groups led by Board and executive members

reviewed the role of stakeholders towards an improved

industry. The central themes and issues informed the findings

and conclusions of the Status Report that was presented to

stakeholders in April 2004. In the year ahead we will call for

nominations to reconstitute the forum in accordance with the

CIDB Act.

The November Forum meeting was preceded by workshops

in Bloemfontein, Durban, Port Elizabeth and Midrand where

staff and Board members engaged discussion on the

Construction Registers Service, procurement best practice, the

Toolkit and Code of Conduct. In Limpopo, piloting and

refinement of the Registers has been further informed by

workshops with contractors across the province.

Expanding international partnership, the organisation

hosted delegations from sister institutions in Africa, including

Malawi, Zambia and Tanzania. Responding to a request from

Tanzania's National Construction Council, ci b delivered a

keynote address to its conference on “Construction Industry

Development in a Changing Global Environment”. We were also

able to mobilize associate industry expertise to provide insight

to the conference on South Africa's experience in the

development of public private partnerships.

Continued cooperation with the Building Construction

Authority (BCA) of Singapore was consolidated by a visiting

delegation that peer-reviewed the principles, technical

infrastructure and business processes of the pilot Construction

Registers Service.

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“Construction industry development addresses the

role and contribution of all who add value to the

construction delivery process, and all those who

influence the industry's performance and

transformation.”

CIDB Act 38 of 2000:

The Board must constitute a ”Stakeholder Forum to

inform it on matters that affect the development of

the construction industry.”

November Stakeholder Forum:

breakaway themes and some issues

Growth and sustainable empowerment

• repeat work, long-term relationships and improved

profit margins

• access to finance and credit

• opportunities across the supply chain.

Delivery and procurement

• improved public sector delivery management

• uniform, efficient, transparent and fair procurement

• tender award on the basis of best value, not lowest

price.

Employment, skills and capacity

• improved employment practices by contractors &

subcontractors

• investment in human capital, management training

and mentoring

• safety, health and HIV/Aids awareness.

Industry and client performance

• improved safety and health, including HIV/Aids

awareness

• improved definition of project scope, and prompt

payment

• improved industry image.

Mmapula Ikaneng of NUM at the Construction Industry Stakeholder

Forum, 2003.

Building partnership

Development context

Our commitment to a partnership model is founded on the

understanding that construction industry development

addresses the role and contribution of all who add value to the

construction delivery process, and all those who influence the

industry's performance and transformation.

Intensive focus through the year has delivered the Construction

Registers Service that will shape and reflect progress in the

transformation of the South African construction industry.

With publication of regulations in June this year, we are able

to commence the 2004 national roll-out of the Register of

Projects and the Register of Contractors in line with our

business plan commitment.

Promulgating the Construction Industry Development

Regulations, Minister Sigcau said “The CIDB will implement the

Construction Registers Service as legislated by Parliament to

create an enabling regulatory environment that supports

improved industry performance and more effective delivery.”

As required by the Act, contractors registered with the ci b

will be assessed in terms of their construction works and

financial capability. The assessment criteria are built around

basic business sustainability criteria, which will ensure that

contractors only execute construction works within their

capability. This will result in a more sustainable tendering and

contracting environment for contractors, and in significantly

reduced project failures.

We have now concluded the pilot phase of the Registers with

support of a client steering committee including the Limpopo

and Gauteng Department of Public Works and Transport, the

National Department of Public Works and eThekwini Metro. The

pilot phase registered almost 2000 contractors and has enabled

valuable feedback to improve a range of criteria relating to

grading, fees, ci b capacity and other aspects of the service.

Registration has received the broad support of industry and

stakeholders in a wide range of workshops held with clients and

contractors. Clients like the Department of Public Works await

the registers roll-out as a basis for targeted enterprise

development initiatives such as the envisaged incubator

programme.

In Limpopo, where 80% of public construction is delivered

by black contractors, many complained that industry

opportunity is being raided by “part-time” players, who win

tenders and subcontract to real contractors. Their aspiration is

that registration will promote more sustainable opportunity and

growth for committed industry participants. The unsustainable

tendering environment is borne out by client experience.

Limpopo Public Works has reported receiving over 100 tenders

for a classroom block with an estimated value of R300 000.

A case study conducted by ci b on a tender for housing

services at Hammanskraal illustrates the tender evaluation

dilemma facing public officials and the wasteful cost of

tendering to the industry, with 21 tenders ranging from R6

million to over R60mn. An analysis of the capabilities of

tenderers in terms of the proposed ci b contractor grading

system indicated that 6 tenderers were competent to tender.

Their offers ranged from R11m to R17m, demonstrating the

potential of the Register to regularize the tendering

environment.

Phased implementation in the year ahead will be closely

monitored to ensure that the system design and requirements

are practically aligned with the principles and intentions of

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construction industry development and the CIDB Act. We will

also be challengened to expand the full potential of the registers

to:

• incorporate empowerment criteria agreed by industry and

government

• introduce the phase two requirements for client and

contractor best practice

• measure and report on impact

• promote the grading system as a basis for targeted

development interventions by clients

• conceptualise a register of professional service providers.


The CIDB Act stipulates that to promote best practice,

the Board must establish and maintain:

• “…a national Register of Contractors …, which

provides for categories of contractors in a

manner which facilitates public sector

procurement.

• a best practice contractor recognition scheme

…which promotes contractor development

and monitors contractor performance.

• the Register of Projects and the best practice

project assessment scheme…for the promotion,

assessment and evaluation of best practice on

construction contracts

and may establish and maintain “…a register of

suppliers, manufacturers or service providers.”

The CIDB Act and the new regulations stipulate that:

• All contractors undertaking work for the public

sector must be registered

• All public and private sector projects above a

certain value must be registered by clients.

Building the construction registers service


Framework for transformation

Addressing his aspiration, Pepi Silinga, ci b Deputy

Chairperson and CEO of Coega (a major industry client), said

that the “grading assessment envisaged in the regulations will

enable clients to target their development programmes in a

more focused way so that contractors are able to grow and

evolve within the framework.

By promoting best practice and compliance with statutory

obligations throughout the delivery chain, the Registers will

begin to close the gap between the formal and informal sectors.

Importantly, we believe the Registers will support sustainable

broad based Black Economic Empowerment.”

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Construction Registers Service - an overview

The registers drive a macro risk management process for

clients and contractors regulating the construction industry

around a common development agenda underpinned by best

practice procurement and project processes.

As envisaged by the legislation, the registers are the

principle instruments driving improved demand and supply-

side industry performance. They constitute a regulatory

framework that supports sustainable delivery, development

and empowerment.

The data assembled by the registers will provide a

comprehensive overview of construction demand and supply

across the country as well as information on the transforming

practices of clients and contractors.

The national Register of Contractors supports public

sector risk management, reduces the administrative burden

associated with the award of contracts, and promotes the

performance and development of contractors.

The national Register of Projects registers all public and

private sector projects above a prescribed value. The

Register provides information on the nature and distribution

of projects and promotes the performance of public and

private sector clients in the development of the construction

industry.

In its design and piloting, the ci b has aimed to ensure

that the service meets the following objectives:

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Reduced risk to public sector clients through the

Register of Contractors that will categorise contractors in

accordance with their capability

Streamlined procurement with reduced wastage,

including reduced tendering costs to industry, and reduced

tender evaluation costs to public sector clients.

Improved construction delivery through

• requirements on private and public sector clients that

promote consistent procurement practice, sustainable

development and transformation

• a contractor recognition scheme that promotes supply-

side performance in terms of quality, safety, health and

the environment

A framework that supports sustainability in the

tendering environment and enables clients to structure

their contracting and development strategies to target

appropriate sectors of the market

An established track record for emerging contractors

that will facilitate public and private sector confidence and

access to credit, finance and opportunity

Access by decision makers, clients and service

providers to live and comprehensive geographic

information on construction demand and supply, including

size, nature and distribution of projects and service

providers

Business to business linkages

An improved industry image that fosters investment.

The ci b Registers team from left to right (back) Enoch Masibi, Caswell Mtombeni (associate), Pregan Pillay, Mthetheleli Baqwa, Ebrahim Moola, Katlego

Molibeli (front) Annah Modiba, Tiego Vuma.

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"the Registers will begin to close the gap between

the formal and informal sectors. Importantly, we

believe the Registers will support sustainable

broad based Black Economic Empowerment.”

Pepi Silinga, cidb Deputy Chairperson”

10annual report 2004

Streamlined and uniform procurement


Construction Procurement Best Practice Library

The regulatory framework for public sector procurement in South Africa - highlighted are the ci b components finalised during the year in review.

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This year we were able to report on delivery in relation to the

June 2003 Growth and Development Summit agreement

stating that “…the construction industry is working with the ci b

to address the confusion amongst participants in construction

contracts and bring a modicum of standardization to the

delivery process…” The report requested by Business Unity

South Africa acknowledges the significant effort of private and

public sector stakeholders.

In 2003, the ci b convened a focus group of over 50

industry specialists, practitioners and stakeholders, including

client representatives, to peer-review and refine:

a) A Code of Conduct for all participants in the construction

procurement process, including the private sector.

b) Construction Procurement Best Practice guidelines for

public and private sectors.

These were published for comment in the government

gazette. Comment was reviewed by the focus group and the

ci b Board. The refined outcome has subsequently been

published in accordance with the CIDB Act.

c) The Standard for Uniformity in Construction Procure-

ment

In line with regulations promulgated by the Minister of

Public Works on the 9th June 2004, the ci b has finalized and

published the Standard for Uniformity in Construction

Procurement, which incorporates best practice. The regulations

and the standard reflect government's determination to

promote uniform procurement practice throughout the public

sector.

The Standard is aligned with National Treasury's regulations on

Supply Chain Management (December 2003) and is

underpinned by the Public Finance Management Act. ci b has

ensured that the standard is also embedded in the Toolkit

Delivery Management System which provides the platform for

roll-out and capacity building throughout the public sector.

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The establishment and gazetting of construction

procurement best practice and the Standard for Uniformity

in Construction Procurement realizes the ci b's obligation

to:

“determine and establish best practice that

promotes procurement and delivery manage-

ment reform

“provide information to stakeholders on best

practice”

and “within the framework of the procurement

policy of government, promote the standardi-

sation of the procurement process with regard to

the construction industry.”

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Standard for Uniformity in Construction

Procurement: an overview

The ci b Standard for Uniformity in Construction Procure-

ment establishes requirements for construction

procurement that are aimed at bringing about stan-

dardisation and uniformity in procurement documentation,

practices and procedures. This Standard establishes

minimum requirements which are consistent with the

provisions of the regulatory framework for public

procurement. It provides the overarching framework for

the inviting of tender offers, for procurement documents

and procedures.

The Standard references best practice and is published

in Government Gazette 26427 of 09 June. It is also

available on the ci b website.

The ci b has worked with a focus group of industry

experts to develop a library of best practices relating to

procurement in the construction industry.

The Construction Best Practice Library has been peer

reviewed by industry experts and is referenced in the

Standard for Uniformity in Construction Procurement and

in the Toolkit Delivery Management System. The Library

comprises best practices in the following categories:

• Procurement procedures

• Procurement documentation

• Contracting strategies

• Alternative dispute resolution

• Subcontracting arrangements

• Joint venture arrangements

The Best Practice Library is available on CD and can be

downloaded from the ci b website - www.cidb.org.za.

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Delivery and Procurement Team. Osafo Gyimah, Bridgette Gasa,

Linda Vabaza and Malcolm Pautz.

“Procurement arrangements bind the supply

chain and define the obligations, liabilities and

risks that link the parties together in the delivery

process."


Procurement

Delivering the Code of Conduct

The construction industry operates in a uniquely project-

specific environment, continuously combining different clients,

consulting professions, as well as different contractors and

subcontractors in a variable supply chain. Procurement

arrangements, which also vary considerably, bind this supply

chain and define the obligations, liabilities and risks that link the

parties together in the delivery process.

The conduct of parties throughout the supply chain impacts

on the ability of the construction industry to deliver value and to

perform efficiently and competitively. A high standard of

conduct is essential to the growth, development and

sustainability of enterprises and to the objectives of

empowerment and transformation. Conduct impacts directly on

project costs, timely completion and delivered quality.

The ci b Code of Conduct for construction represents an

important step in the management of integrity and the creation

of an environment within which business can be conducted in a

fair and transparent manner. It also forms an essential first line

of defence in combating the scourge of corruption, including the

practice of fronting. The Act provides for enforcement of the

Code. But it is in the interests of a better construction industry

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The CIDB Act mandates the ci b to establish and promote

uniform and ethical standards “that regulate the

actions, practices and procedures of parties engaged

in construction contracts” and stipulates that:

“To promote uniform and ethical standards within the

construction industry the Board: must publish a code

of conduct for all construction-related procurement

and all participants involved in the procurement

process.”

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Code of Conduct:

The six-point Code of Conduct deliberately avoids the pitfall

of detail. The Code states that the parties in any public or

private construction-related procurement should in their

dealings with each other:

• Behave equitably, honestly and transparently.

• Discharge duties and obligations timeously and with

integrity.

• Comply with all applicable legislation and associated

regulations.

• Satisfy all relevant requirements established in pro-

curement documents.

• Avoid conflicts of interest.

• Not maliciously or recklessly injure or attempt to injure

the reputation of another party.

The Code has been published with a set of examples that

illustrate good conduct and, by implication, conduct that

would breach this Code.

The Code is available in hard copy and can be

downloaded from the ci b website.d

to have all parties committed and to do business only with those

who apply the code in all business processes.

Promoting the Code of Conduct is an industry wide

challenge. ci b will ensure its distribution to all registered

contractors and all clients that register projects. In cooperation

with the South African Institution of Civil Engineering, we have

embarked on workshops around the country to promote the

Code and the role of the professions in best practice procure-

ment.

Our joint commitment must also translate into a programme

that supports the empowerment of SME's to know their “rights

responsibilities and risks” in construction contracts. The cidb

“3R's guide to contracts” produced last year provides a basic

tool for this purpose and has been much in demand from

stakeholders.

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for all parties engaged

in construction procurement

October 2003

code

of

conduct

The construction industry in South Africa now has a Code of

Conduct for all parties engaged in construction procurement,

including clients, the professions and all service providers. This

is a landmark achievement for industry development and

transformation. It aligns industry and its partners with

international standards for good corporate governance and the

provisions of the King Report 2002. The code was developed in

consultation with stakeholders through the procurement focus

group and was published in Government Gazette No. 25656 of

October 2003.

“Our joint commitment must also translate into

a programme that supports the empowerment of

SME's to know their 'rights responsibilities and

risks' in construction contracts.”


ci b has delivered on the strategy conceived last year for a

systematic approach to improved delivery of public

infrastructure.

The Infrastructure Delivery Management Toolkit has been

developed in collaboration with National Treasury. Consultation

with provincial treasuries and delivery departments has

brought the prototype Toolkit to completion.

The Toolkit provides a systematic guide to the full cycle of

infrastructure delivery from needs identification, planning and

budgeting through to procurement, construction, handover and

maintenance. It provides a common platform for public sector

delivery which accounts for about 40% of construction

investment.

The Toolkit underpins the planned implementation of

government's Infrastructure Delivery Improvement Pro-

gramme (IDIP) that will be rolled out in a phased approach over

the next 2 years.

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The key strategy of the roll out programme is to facilitate the

development of appropriate capacity in each identified

provincial department. An extensive induction, capacity

building, mentoring and coaching programme on the Toolkit will

be initiated in key provincial departments.

It is particularly rewarding that our early conceptual work

has led to this programme and partnership, which is expressed

in a Memorandum of Understanding with National Treasury and

the Department of Public Works. Our investment of effort has

helped to leverage a R20 million capacity building programme

for 2004/05 that is supported by the European Commission in

cooperation with the Development Bank of South Africa.

In the year ahead, ci b resources will be severely tested to

ensure our obligation to train the 13 Technical Assistants

recruited for the pilot roll-out, to monitor success of the

capacity building process, and to adapt and maintain the Toolkit

and its integrity.

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The Act mandates the ci b to:

“…determine and establish best practice that

promotes improved public sector delivery

management; promote uniform application of policy

with regard to the construction industry throughout

all spheres of Government;” and in this regard “develop

and promote appropriate training programmes for

public sector officials.”

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Delivery and capacity

“a R20 million capacity building programme

for 2004/05.”

The Toolkit Delivery Management System:

The IT-based methodology will enable public-sector

delivery managers to:

• Design infrastructure & maintenance programmes

using simple templates and guides to formulate

effective programme implementation plans

• Locate policy guidelines relevant to each delivery

stage

• Appropriately allocate budget in alignment with

programmes

• Identify and prioritise projects

• Manage planning and the design of projects

• Procure professional services, goods and supplies

• Manage construction procurement

• Oversee the implementation of projects and administer

contracts

• Consistently report on progress using a Management

Information System.

The Toolkit incorporates the ci b Standard for Uniformity in

Construction Procurement and client procedures in terms

of contractor and project registration. It forms the basis for

roll-out of government's Infrastructure Delivery and

Improvement Programme, commencing in 2004.

"A holistic model that provides guidance for the

management of public-sector processes.”

Dr Sean Phillips, who leads implementation of the

Expanded Public Works Programme.

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Building public sector capacity

The Prototype Delivery Management System

the infrastructure delivery

toolkit for the public sector

October 2003



Pepi Silinga, Deputy Chairperson of the ci b with James Maseko,

Director-General of Public Works at the Construction Industry

Stakeholder Forum, 2003.

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This year we have responded to government's focus on job

creation and poverty alleviation as embodied in the Expanded

Public Works Programme (EPWP). Using labour-based

construction methods, the EPWP will promote short-term work

opportunities and training in the delivery of national, provincial

and municipal infrastructure.

On the request of the EPWP we have started a process to

establish Labour-Based Best Practice Guidelines that extend

the job creation potential of existing guidelines. Building on the

work of the Inter-ministerial Task Team on Construction

Industry Development which preceded the ci b, our executive

has expanded the application of technologies and methods to

increase the employment generated per unit of expenditure.

A focus group of industry specialists and stakeholders has

reviewed and refined these guidelines with a view to their

publication and promotion during 2004.

Referring to the agreement reached by the social partners at

the Growth and Development Summit, Minister Sigcau has

highlighted “the special responsibility placed on the

construction industry to spearhead job creation and skills

development so that our growing economy is increasingly

accessible to all citizens and in turn is injected with the vigour

of expanding productive participation.”

Beyond the pressing need for job creation lies the challenge

of sustainable and improved employment. Enterprise con-

solidation and growth are fundamental to meeting this

challenge and will be fostered by the Construction Registers

Service as it begins to stabilize the market, providing a

framework for targeted enterprise development initiatives. The

service will also drive improved health and safety practices and

client responsibility to ensure HIV/Aids awareness on

construction projects.

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The Act defines best practice as “a desirable and

appropriate standard, process, procedure, method

or system in relation to the delivery process and the

life cycle of fixed assets.”

The Act tasks the Board to determine and establish best

practice that promotes national social and economic

objectives including labour absorption in the

construction industry, growth of the emerging sector,

improved labour relations, positive safety, health and

environmental outcomes.

Labour-Based Best Practice Guidelines in

development

It is generally accepted that employment intensive

methods are technically feasible for a wide range of

construction activities and, with the appropriate use of

equipment, can generally produce the same quality as

equipment-intensive methods.

The ci b best practice guidelines establish desirable

and appropriate standards, processes, procedures and

methods relating to the design and implementation of:

• Labour-based construction methods for earthworks.

• Labour-based methods for materials manufacture

covering:

- precast concrete products using hand methods and

light equipment,

- stabilized adobe block walling.

• Labour-based construction technologies for open flow

channels, rubble masonry, dam and arch bridge

construction, roads and pavements.

• Procurement methods for implementing labour based

construction works projects.

The draft guidelines are available on the ci b website and

will be published and promoted in the year ahead.

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Special responsibility is "placed on the

construction industry to spearhead job creation

and skills development so that our growing

economy is increasingly accessible to all

citizens.” Stella Sigcau, Minister of Public Works

Shaping best practice for development


Lietsiso Mohapeloa ci b Board member, at the Bloemfontein

preliminary Stakeholder Forum 2003 workshop.

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In partnership with industry and academics the ci b held a Post

Graduate Student Conference as a step towards a national

research agenda for construction industry development.

The Conference received support from the provincial MEC

for Public Works, Ms Gloria Barry and Minister Stella Sigcau,

who engaged students and academics in a special imbizo on

research issues and priorities. The generous contributions and

commitment of industry players including FEM, Lafarge SA,

Coega, AAAMSA Group, UPE and the Peninsula Technikon

ensured the conference viability.

Thirty research papers highlighted current areas of

academic interest. The conference enabled greater focus of

South Africa's intellectual capability on the critical challenges of

construction industry development. It provided students,

researchers and practitioners with a unique opportunity to

network, share ideas and learn from each other's work.

We have taken the work of the conference forward to

develop a research database. The second post graduate student

conference to be held in Cape Town will be facilitated in

partnership with the University of Cape Town and ci b intends

to present a survey of current tertiary research on the built

environment.

A key challenge in development of the R&D agenda is the

limited availability of funding impairing the ability of industry,

government and clients to sustain a national built environment

research capability that stimulates innovation and underpins a

quality teaching capability. In collaboration with CSIR, the ci b

has developed a preliminary concept document to promote

discussion on a research and development partnership by

government, private sector clients and industry.

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Performance

Building a research and development agenda


1st post graduate student conference:

The conference attracted 30 research papers from

students, researchers and educational institutions across

the country, with some papers co-authored by

international researchers. These were peer reviewed by a

scientific and technical committee comprising academics

from the Peninsula Technikon, the universities of Pretoria,

Free State, Botswana, Witwatersrand, South Africa and

Port Elizabeth.

Three award-winning papers came from the University

of Witwatersrand and one from the Peninsula Technikon.

Papers were called for on the following themes:

Construction Demand Capacity

Empowerment Quality and Productivity

Business Performance Procurement Strategies

Emerging Contractor Briefing, Planning and

Development Design

Construction Management Best Practice and

Benchmarking

Human Resource Safety, Health and

Development Environment

Information Technology Construction Industry

in Construction Policy

Value based approaches Role of clients and the

professions

The conference report and papers are available on the ci b

website.

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The Act mandates the Board to “promote appropriate

research” and “to develop, promote and update a

construction industry research agenda that defines

national development priorities.”

Ms Edith Nyandoro, Winner of Best Paper at 1st post graduate

student conference, Port Elizabeth.

“Technical capability and a culture of innovation

are the cornerstones for Research and

Development, driving academic institutions in

their quest to shape the human capital of industry.”

Status Report 2004

The ci b framework of CII's has been developed with the

support of CSIR Boutek and initial work by DPW. The framework

is based on a review of international benchmarking and

performance indicators for the construction industry. A focus

group of industry experts provided guidance to the ci b in the

finalisation of indicators that encompass the specific objectives

of industry development in South Africa.

The summary results included in this report reflect selected

indicators measured for the 2001, 2002 and 2003 calendar

years. In 2001 the project based pilot measurement was based

on 250 returns from a mix of clients and contractors. In 2002

and 2003 the measurement was expanded to include the

consulting professions, with a total of 900 and 1 250 returns

received, respectively.

On the basis of the unfolding 2003 BEE strategy and

scorecard, a company-based pilot measurement was

undertaken to measure broad based black economic

empowerment in the contracting sector for the year 2003. Fifty

four firms were measured. The consulting professions were not

surveyed as a similar survey was being undertaken at the time

by SAACE.

The samples for the various measurements have been taken

from a cross-section of project or enterprise type and size, or

value. Except for the pilot BEE indicators, the 2003

measurement was based on a sample designed to provide at

least a confidence level of 90% and a reliability of 5%. Further

expansion of the sample is planned in order to increase the

confidence level and reliability of future measurements.

The indicators are expected to show improvement over

time. However, experience elsewhere has shown that as

performance improves, the expectation of participants also

grows in relation to some of the perception based indicators

such as defects and client satisfaction.

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Part of the ci b Status Report team (from left to right) Sheila Hughes,

Steve van Huyssteen (CSIR), Llewelyn van Wyk (CSIR),

Maurice Makhathini and Lizette van Heerden.

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As an annual snapshot in time the indicators

provide a benchmark against which, clients,

consultants and constructors can measure and

improve their own performance in relation to

industry norm.

Client Performance

<30 days

100

80

60

40

20

030+ days 60+ days 90+ days

2001 2002 2003

Prompt payment: The average number of days’delay between certification of work and receipt of payment.

Contractors: average number of daysdelay before payment

<30 days

100

80

60

40

20

030+ days 60+ days 90+ days

Prompt Payment: The average number of daysdelay from receipt of invoice.

Consultants: average number of daysdelay before payment

2001

100

80

60

40

20

02002 2003

Use of modern contracts:

Percentage (by number) of contracts meeting the principles of modern contracts

Payment is the single

overriding obligation of

clients in terms of their

contractual relationships

with contractors and

consultants. The general

contractual norm is 30

days from receipt of

invoice.

Modern forms of contract are those that appropriately

allocate risks, liabilities and obligations and contain

administrative procedures that enable proactive

management of the delivery process.

2001 2002 2003

Types of contract considered to meet the principles of modern contracts were unaltered versions

of: GCC-90, GCC, NEC, JBCC 1991, JBCC 2000, and FIDIC.

Construction Industry Indicators (CIIs)


Benchmarking progress

Industry Performance Black economic empowerment contracting sector

67

66

65

64

63

62

61

60

59

58

57

Percentage of contracts completed within or under budget

Cost predictability: Was the project completed within the proposed budget?

2001 2002 2003

68

66

64

62

60

58

Percentage of contracts completed on time or earlier

Time predictability: Was the project completed within the proposed schedule?

2001 2002 2003

70

60

50

40

30

20

Percentage of contracts where the productwas relatively defect-free or better

Defects: The percentage of contracts, where the product was defect-free or relatively defect-free and where defects

had little or no impact on the client.

2001 2002 2003

Average % dividend accruing to black owners across small, medium and large enterprises

BEE ownership and accrued benefit: The graph illustrates that, for the sample measured, the percentage black ownership is lower among

firms of high turnover than among firms of low turnover.

<R2m

80%

60%

40%

20%

0%R2m-R10m R10m-R50m >R50m

Enterprise turnover category (Rands)

Average % black participation atsenior management level

Management equity: The percentage black senior management at the level of contracts manager or above is lower among firms

of high turnover.

<R2m

80%

60%

40%

20%

0%R2m-R10m R10m-R50m >R50m

Enterprise turnover category (Rands)

Percentage procurement fromblack owned enterprises

Procurement from black-owned and black-empowered enterprises: The percentage of the value of goods and services

that was procured from black owned and black empowered enterprises by the contracting enterprise during the last financial year.

<R2m

80%

60%

40%

20%

0%R2m-R10m R10m-R50m >R50m

Turnover category (Rands)

2001

70

60

50

40

30

202002 2003

Consultants Contractors

Percentage of contracts with a high levelof client satisfaction

Client satisfaction: The percentage of contracts where clients had a high level of satisfaction with the process and outcome of the

project and the service received.

BEE ownership excludes the listed contracting

companies, which express difficulty identifying

shareholders. Listed companies account for about 20% of

total turnover in South Africa.

The results of the BEE pilot survey need to be treated with

some caution, particularly those relating to procurement

which appear high. Future measurement will need to

ensure greater understanding and clarity in relation to the

survey questions.

Many factors contribute to time and cost

predictability, including the more ac-

cepted factors of inclement weather,

unexpected founding conditions, etc.

Poor pre-contract planning and “scope

creep”, late design, over-commitment

and poor implementation can be

attributed to industry performance. Late

interim payments by clients can also be

a factor.

Client satisfaction and the perception

of defects are subjective indicators

and the perception of performance

depends on the sophistication and

expectation of the client.


This year we fulfilled our undertaking to deliver a structural

review of the industry and its development.

ci b Status Report 2004 is a milestone product of

stakeholder collaboration that takes stock of the state of the

construction industry and its preparedness for key

development challenges facing our country. The report has

been tabled in parliament and at NEDLAC to inform the

Construction Summit planned by government, business and

labour.

The Status Report offers a comprehensive view of current

dynamics impacting on the creation of an enabling environment

for construction industry development. The report draws on the

views and insights of a wide range of stakeholders who engage

in the delivery process and affect the performance of

construction. The views were obtained through a survey of over

200 representatives of key sectors, including: investors, public

and private sector clients, the built environment consulting

professions, contractors and subcontractors, organised labour,

academics, materials manufacturers and suppliers.

The ci b project team included associate researchers of

CSIR Boutek, associate practitioners and academics.

Interpretation of trends and challenges also took account of

the June 2002 and November 2003 Stakeholder Forum

meetings. The views expressed in the survey were interpreted

against factual information, reports and research studies.

A “Strategic Group” of over twenty leading informants in

different sectors helped to shape the survey and its findings,

and provided insight on interpretation. Many people provided

valuable comment on draft documentation.

In finalising the report, ci b has provided a documentary

framework for future debate and engagement of the challenges

ahead, including a value proposition that supports sustainable

construction, the built environment needs of present and future

society and the development of the industry and its people.

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Status Report 2004 responds to the ci b's mandate: to

“facilitate communication between construction

industry stakeholders, all spheres of Government",

”, to publish “reports on the state of the industry” and

to “… provide strategic leadership to stakeholders

for growth .”

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Status Report 2004:

Synthesis review of the SA construction industry

Status Report 2004 documents the role of the industry in

the context of South Africa's growth and transformation

agenda.

Based on surveys, stakeholder perceptions, studies and

factual data, it assesses the performance of the different

sectors that influence the construction delivery process

and the development of the industry. Crosscutting findings

are organised within the strategic framework of growth,

delivery performance, capacity and empowerment.

In this context the report highlights a range of

challenges and opportunities. It invites discussion by all

stakeholders and endeavours to plot a path into the future.

A central challenge lies in the dispersed nature of the

industry and its client base requiring a convergence of

stakeholder focus for improved performance with regard to

product, process and people issues.

The way forward offers a crystallized perspective of

actions and initiatives deemed necessary to advance

industry development from the platform created over the

past few years. It suggests measures to:

• boost delivery capability and skills

• engender a culture of respect for people and pride in the

industry

• deliver sustainable empowerment

• implement an improved regulatory and procurement

framework

• promote greater public and private sector partnership.

Mapping a path forward

“The way forward offers a crystallised perspective

of actions and initiatives deemed necessary to

advance industry development from the platform

created over the past few years.”


The way forward presents new and exciting challenges to ci b

and all stakeholders as we roll out the development framework

created jointly over the past year. We will continue to expand

partnership with clients and constructors in our quest to shape

an enabling environment for growth, performance and

sustainable empowerment.

Central to this transforming environment is the

Construction Registers Service rolling out nationwide into late

2005. Our joint progress further equips stakeholders with

procurement best practice, a Code of Conduct and a Toolkit

infrastructure delivery management system to drive consistent

procurement and improved delivery capacity. We will establish

benchmarks to measure progress.

Implementing the development framework is a collective

challenge for the year ahead.

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Special thanks

It has been a great privilege to participate in the thirty Board

meetings that have guided the ci b's growth and progress over

the past three years. Every Board meeting has constructively

challenged our assumptions and outputs in order to validate the

strategic direction of construction industry development.

It gives me great pleasure to thank the Chairperson Brian

Bruce and the Deputy Chairperson, Pepi Silinga, the

Remuneration Committee led by Carl Grim, and all Board

members for leadership, wise advice and a commitment that

has extended way beyond the boardroom. I also wish to thank

the Minister of Public Works, Ms Stella Sigcau, and all

stakeholders for continued championship and support.

We will continuously evaluate progress to ensure that our

programmes are performing as the instruments of development

and transformation they are intended to be.

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Spencer Hodgson

Chief Executive Officer

“Leadership and collaboration are needed to

enhance the capability and focus of all who

engage in the delivery process; a focus to grow,

transform and nurture the national asset base of

our construction industry.”

Stella Sigcau, Minister of Public Works

The year ahead


The staff of the ci b.

Bottom left:

Maurice Makhathini, Linda

Vabasa and Kotli Molise.

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Into the future

Corporate Governance Report

CIDB Board

Board Members 2003 / 2004

The Board of the ci b has a mandate to approve the annual

financial statements and assure the auditors of their integrity

and reliability. The Board also reviews the entity's corporate

performance and its levels of responsibility, communication and

accountability as a public body. This responsibility

encompasses approval of strategic plans, the review and

monitoring of strategic deliverables, the determination of

internal control procedures, plus the appointment and

performance of the CEO.

The Board is appointed by the Minister of Public Works and

members are selected for their range of complementary

knowledge and skills, their public and private sector experience

and understanding, and their ability to provide collective

leadership for construction industry development in accordance

with the entity's founding legislation. The members of the ci b

Board serve a three year term as recommended by the enabling

legislation. To ensure continuity, the CIDB Act requires that at

least one third of the Board should be re-appointed to serve a

further term.

The Act requires the Board to meet at least four times per

annum. However, to ensure its strategic role, the Board has

scheduled monthly meetings and during the financial year in

review has held nine meetings, providing effective direction to

the operation of the entity. The Audit and Remuneration

Committees meet three to four times per annum and as

necessary.

The ci b Board consists of the following members, who were

appointed for a three-year term of office.

Non Executive Board Members Date of appointment:

Brian Bruce (Chair) 1 April 2001

Pepi Silinga (Deputy Chair) 1 April 2001

Carl Grim 1 April 2001

Mahlape Sello 1 April 2001

Khanyile Mlambo 1 April 2001

Cannon Noyana 1 April 2001

Sam Amod 1 April 2001

James Henrey 1 April 2001

Lietsiso Mohapeloa 1 April 2001

Rodney Milford 1 April 2001

Lydia Bici 20 Nov 2002

Mandla Ndlovu 20 Nov 2002

Executive members

Spencer Hodgson (CEO) 1 December 2001

Executive staff by invitation

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The ci b is a schedule 3A national public entity under the

executive authority of the Department of Public Works.

It is charged with the role of strategic leadership for

construction industry development. In this regard, the ci b

has a comprehensive vision and programme that is concretized

in the annual strategic and business plans, in accordance with

the enabling legislation of the entity, (CIDB Act 38, 2000). The

operating policy of the ci b upholds the principles of corporate

governance through its adherence to the PFMA, Treasury

Regulations and the advisory principles of the second King

Report.

The ci b Board, supported by an Audit Committee,

Remuneration Committee, the CEO and the executive

leadership team ensure the effectiveness of the enterprise's

good governance. Proper controls are in place to identify and

report any material breakdown and ensure that corrective

action is taken.

As part of the overall strategy to ensure that PFMA

requirements are met and good corporate governance policies

are adhered to, internal controls have focused on areas of risk

management, accountability of assets, staff policies and sound

procurement practice as well as the reliability and integrity of

the financial statements.

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The 30th ci b Board meeting.d


Resignations Date of resignation

Giovanna Fenster 30 September 2003

In addition to the nine Board meetings held, Board members

have engaged a range of other duties including the Stakeholder

Forum, focus groups meetings, staff interviews, Remuneration

and Audit Committees, procurement panels and presentations

at industry and stakeholder functions. Board members have

variously championed specific areas of ci b endeavour

including the Construction Registers Service, procurement

reform, delivery management, HIV/Aids, R&D, industry status,

including growth, capability and empowerment.

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Remuneration Committee

Carl Grim (Chair)

Mahlape Sello (Board member)

Rodney Milford (Board member)

The Remuneration Committee is comprised of 3 Board

members appointed by the Board, who are tasked with the

evaluation and review of human resource strategy and

operations. The CEO and the CFO attend meetings by invitation.

The committee's specific terms of reference include direct

authority for consideration of and recommendation to the Board

on matters relating to general staff policy, remuneration,

bonuses, executive remuneration and review of service

contracts and other benefits. The remuneration committee also

evaluated and approved staff salaries and performance

bonuses for the period ending March 2004.

The Audit Committee is appointed by the board and is chaired

by an independent chartered accountant who is neither an

executive, nor a ci b Board member. The Committee further

includes 2 non-executive members and 2 board members.

Meetings are attended by the CEO, chief financial officer,

members of the Auditor General's office and members of the

internal audit unit. The functions of the audit committee are to:

• review the effectiveness of the internal audit function

• evaluate the annual financial statements

• monitor internal control systems

• agree the scope of the external audit by the Office of the

Auditor-General

• monitor compliance with the PFMA and Treasury

regulations.

The internal audit unit plays an important role in corporate

governance. ci b has outsourced this service to MSGM Masuku

Jeena Inc which has subsequently amalgamated with

Pricewaterhouse Coopers. The function is mandated by the

Audit Committee and advises the Committee and the CEO. The

internal audit unit measures and evaluates the effectiveness

and application of policies, procedures, systems and processes

designed to fulfill the requirements of the risk management

policy. It also measures general compliance with governance

principles, regulation and the safeguarding of assets.

The internal audit unit presented its quarterly reports to the

audit committee on 3rd June 2003, 7th October 2003 and 3rd

February 2004.

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Internal Audit Unit

Breakaway session during the Construction Stakeholder Forum, 2003.

Attendance Other

at board Engagements Earnings

meetings No. Of Days for Year

1. Brian Bruce 8 6 R 21 318

2. Pepi Silinga 6 5 R 15 664

3. Carl Grim 6 3 R 9 149

4. Mahlape Sello 6 1 R 9 052

5. Khanyile Mlambo 5 1 R 4 895

6. Giovanna Fenster 2 3 R 3 077

7. Cannon Noyana 9 30 R 49 616

8. Sam Amod 7 11 R 17 464

9. James Henrey 8 23 R 20 759

10. Lietsiso Mohapeloa 5 9 R 15 369

11.Rodney Milford 8 4 R 11 748

12. Lydia Bici 4 1 R -

13. Mandla Ndlovu 6 1 R 6 356


External Audit

Risk Management

The external audit for the period ending March 2004 was

performed by a team from the Office of the Auditor General.

As the accounting authority, the Board of ci b is accountable for

the process of Risk Management and the system of internal

control. This review includes regular monitoring of the risk

management policy and its effectiveness, together with the

control policies of the organisation.

A comprehensive risk management process was once more

undertaken during the course of the year to effectively identify

and re-assess risk, thereby enabling management to adopt a

proactive stance to risk management and potential failures in

controls, systems and the achievement of strategic objectives.

To this effect each business unit developed its own risk

profile and these were consolidated and reviewed by

independent risk management experts. The involvement of

each business unit results in an overall culture of risk awareness

enabling management to identify and take action in terms of

risks related to both governance and delivery.

The yearly risk assessments are reviewed by the Audit

Committee. A comprehensive risk assessment was undertaken

on the contractors register system during the period under

review and tabled at the Audit Committee meeting of 3rd

February 2004.

d

Materiality Framework

Executive Leadership Team

Related to the management of risk is the development of the

Materiality Framework, as defined by Treasury Regulations and

the PFMA. This framework defines the varying levels of

significance of any wasted resources whether through criminal

behaviour, negligence or fruitless expenditure. This develop-

ment of the Materiality Framework forms part of the ci b's

ongoing commitment to corporate governance. In accordance

with the PFMA, the Materiality Framework was submitted by

the Board for approval by the Minister of Public Works.

This internal team consists of the Chief Executive Officer, the

Chief Financial Officer and three programme managers. The

team ensures that ci b business outputs are strategically

aligned to enterprise objectives, and that measures are in place

to assess outcomes and performance. It reviews and makes

recommendations on business unit strategy and delivery, and

monitors budget expenditure.

The Leadership Team also reviews the human resource

policies and procedures of the entity. These include the plans

for human resource equity, personal staff development and

capacity building. The team provides leadership in promoting

the values, commitment and ethics that underpin the

organisation's mandate.

d

d


The ci b Board

from left to right (back): Rodney Milford, Cannon Noyana, Giovanna Fenster,

Brian Bruce (Chairperson), Carl Grim, Mandla Ndlovu, James Henrey, (front)

Lietsiso Mohapeloa, Spencer Hodgson (CEO), Lydia Bici, Khanyile Mlambo, Pepi

Silinga (Deputy Chairperson).

Inset: Mahlape Sello and Sam Amod.

d

Code of Ethics

Health, Safety and the Environment

Disaster Management

Human Capital

ci b believes in the principles of good conduct, honesty and

transparency. To this effect, it has adopted the following core

values that guide the behaviour and belief system of the

organization and to which the staff have committed:

• To behave equitably, honestly and transparently

• To discharge duties and obligations timeously and with

integrity

• To comply with all applicable legislation and associated

regulations

• To avoid conflicts of interest

• To not maliciously or recklessly injure or attempt to injure

the reputation of another party

• To adhere to and promote the values of the ci b.

These principles are discussed and reinforced at each

individual's performance review.

The ci b is committed to ensure that employees work in a safe,

healthy and clean environment. The company's activities at

present have no adverse effect on the environment. Any activity

that may do so would be accompanied by a risk management

plan to ensure compliance with relevant regulations and

legislation. The ci b is aware of the importance of continuing

good environmental corporate governance. In the

refurbishment of its permanent accommodation we have

endeavoured to implement the principles of sustainable

construction through the reuse of materials, installation of

water saving toilets and an energy efficient cooling system.

In respect to HIV/Aids all employees have access to

awareness materials and precautionary medical advice upon

request. The ci b HIV/Aids Specification on the website

provides guidelines for best practices in awareness and

information services, accessible to the construction industry

and all interested parties.

The ci b is aware of the importance of managing accidents in

the workplace, and of external risk management regarding fire,

flood or personal injury. In the comming year, it will develop an

appropriate policy in this regard.

The ci b executive grew during the year from thirteen, to a total

of eighteen at financial year-end. It further employed 5

temporary staff members. One staff member resigned during

the period under review.

The ci b fosters and encourages personal development

plans in order to retain and nurture the best quality personnel l

d

d

d

d

d

d

d

d

Employment Equity

The ci b has committed to the principles of employment equity

as prescribed in the Employment Equity Act, 55 of 1998.

Accordingly the Board has applied principles of fairness and

equity when recruiting and appointing staff. The ci b has met its

internal employment criteria of 60% black and 30% women for

the period under review.

d

d

and to build a committed and professional executive, capable of

delivering on the organisations key objectives. This capability

has expanded significantly over the past year as a result of

several factors, including:

• focused capacity building, including attendance by three

managers of the one-month intensive Construction

Management Programme sponsored by industry and held

bi-annually

• attendance of a range of relevant workshops and seminars

• continuous learning from engagement with industry role-

players in both ci b focus groups and in industry and

stakeholder events

• collaboration in the development of peer-reviewed papers

presented at national conferences and in Tanzania, Russia

and Singapore, including an award-winning paper

• collaboration on the ci b SA Construction Industry Status

Report

• regular presentation and testing of ci b work in progress

with industry and stakeholders.

d

d

d

Analysis of leave No. of days all

staff

Sick Leave 83

Paternity Leave 5

Family Responsibility Leave 10

Study Leave 22

52% 26% 22% 65% 4% 13% 18% 61%

Overview of ci b Core Teamd

Age Spread Representivity

27 - 34 35 - 46 47 - 57 Black Coloured Indian White Women


We are pleased to present our report for the financial year

ended 31 March 2004.

The Audit Committee consists of the members listed hereunder,

who were appointed on 20 September 2002, and meets twice

per annum as per its approved terms of reference. During the

current year three meetings were held.

Name of member No. of meetings

attended

1 Prof Herman de Jager (Chairperson) 3

(External member)

2 Mr Roy Parbhoo (External member) 3

3 Mr Thabo Pooe (External member) 3

4 Mr Carl Grim (Board member) 3

5 Mr Pepi Silinga (Board member) 2

The Audit Committee reports that it has complied with its

responsibilities arising from Treasury Regulation 27.1.1. The

Audit Committee also reports that it has adopted appropriate

formal terms of reference as its audit committee charter, has

regulated its affairs in compliance with this charter and has

discharged all its responsibilities as contained therein.

The system of internal control is effective as the audit report on

the annual financial statements, the internal audit reports and

the management letter of the Auditor-General have not

reported any significant or material non-compliance with

prescribed policies and procedures.

Audit Committee members and attendance

Audit Committee responsiblity

The effectiveness of internal control

Evaluation of financial statements

The Audit Committee has

• reviewed and discussed with the Auditor-General and the

Accounting Authority the audited annual financial

statements to be included in the annual report; and

• reviewed the Auditor-General's management letter and

management response.

The Audit Committee concurs and accepts the conclusions of

the Auditor-General on the annual financial statements and is

of the opinion that the audited annual financial statements be

accepted and read together with the report of the Auditor-

General.

Chairperson of the Audit Committee

6 July 2004

Audit Committee Report


Discussion during a ci b Board meeting.d

The Board is responsible for the presentation to stakeholders of

the financial position of the entity at the end of the financial

year.

ci b Board members are responsible for the integrity of the

entity's annual financial statements and related information in

its annual report to parliament. In order for the Board to

satisfactorily discharge its responsibilities, there are a number

of procedures and controls in place to facilitate the role of the

Board in this respect.

Management has been delegated with the responsibility of

implementing systems of internal control and maintaining

accounting and information systems designed to provide

reasonable assurance as to the reliability of the financial

statements. These have been prepared in accordance with

South African Statements of Generally Accepted Accounting

Practice (GAAP).

The ci b receives transfer payments from the national

department of public works as per the MTEF. The ci b is

confident that it will remain a going concern in the year ahead

and that no event of significance has occurred subsequent to

balance sheet date.

The Auditor-General is responsible for auditing and reporting

on the financial statements and his report is set out on page 27.

The annual financial statements for the period ended 31 March

2004 are set out on pages 29 to 36. These statements were

approved by the Board on 6 July 2004.

Chairperson Chief Executive Officer

6 July 2004 6 July 2004

d

d

d

Board Approval of the Financial Statements


Pepi Silinga, Deputy Chairperson of the ci b Board

addressing stakeholders.

d

Report of the Auditor-General

A U D I T O R - G E N E R A L

REPORT OF THE AUDITOR-GENERAL TO PARLIAMENT ON THE FINANCIAL STATEMENTS OF THE CONSTRUCTION

INDUSTRY DEVELOPMENT BOARD FOR THE YEAR ENDED 31 MARCH 2004

1 AUDIT ASSIGNMENT

The financial statements as set out on pages 29 to 36, for the year ended 31 March 2004, have been audited in terms of section 188 of the Constitution of the Republic of South Africa, 1996 (Act No. 108 of 1996), read with sections 3 and 5 of the Auditor-General Act, 1995 (Act No. 12 of 1995). These financial statements, the maintenance of effective control measures and compliance with relevant laws and regulations are the responsibility of the chief executive officer. My responsibility is to express an opinion on these financial statements, based on the audit.

2 NATURE AND SCOPE

The audit was conducted in accordance with Statements of South African Auditing Standards. Those standards require that I plan and perform the audit to obtain reasonable assurance that the financial statements are free of material misstatement.

An audit includes:

examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements,

assessing the accounting principles used and significant estimates made by management, and

evaluating the overall financial statement presentation.

Furthermore, an audit includes an examination, on a test basis, of evidence supporting compliance in all material respects with the relevant laws and regulations which came to my attention and are applicable to financial matters.

I believe that the audit provides a reasonable basis for my opinion.

3 AUDIT OPINION

In my opinion, the financial statements fairly present, in all material respects, the financial position of the Construction Industry Development Board (CIDB) at 31 March 2004 and the results of its operations and cash flows for the year then

ended, in accordance with generally accepted accounting practice and in the manner required by the Public Finance Management Act, 1999 (Act No. 1 of 1999).

4. APPRECIATION

The assistance rendered by the staff of the CIDB during the audit is sincerely appreciated.

J M Scottfor Auditor-General

Pretoria26 July 2004

•

•

•



B a l a n c e S h e e t

I n c o m e S t a t e m e n t

S t a t e m e n t o f C h a n g e s i n E q u i t y

C a s h F l o w S t a t e m e n t

N o t e s t o t h e A n n u a l F i n a n c i a l S t a t e m e n t s

S c h e d u l e t o t h e A n n u a l F i n a n c i a l S t a t e m e n t s

2 9

3 0

3 0

3 1

3 1

3 6

Contentsof the Financial

Statements

Financial Statements

BALANCE SHEET AS AT 31 MARCH 2004

TOTAL ASSETS 6 807 821 6 102 658

TOTAL EQUITY AND LIABILITIES 6 807 821 6 102 658

2004 2 0 03

N otes R R

ASSETS

NON-CURRENT ASSETS 2 715 456 2 851 557

Property, plant and equipment 2 2 715 456 2 851 557

CURRENT ASSETS 4 092 365 3 251 101

Stock 3 - 5 1 7 6 1

Accounts receivable 4 716 255 9 74 320

Prepayments 5 2 543 252 1 7 4 0 980

Cash and cash equivalents 11 832 858 484 040

EQUITY AND LIABILITIES

CAPITAL AND RESERVES 5 281 1 2 7 4 933 436

Accumulated surplus 5 281 127 4 933 4 36

CURRENT LIABILITIES 1 526 694 1 169 222

Accounts payable 6 736 648 823 476

Provisions 7 790 046 345 746

Financial Statements


INCOME STATEMENT FOR THE YEAR ENDED 31 MARCH 2004

20 406 668 13 678 782

OPERATING SURPLUS FOR THE YEAR 9 3 4 7 6 9 1 2 496 206

STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 MARCH 2004

BALANCE AT 31 MARCH 2004 5 281 127 4 933 436

2004 2003

Notes R R

OPERATING INCOME

Transfers from Department of Public Works 20 086 858 13 181 000

Interest Received 317 768 496 048

Other income 8 2 042 1 734

Total Income

OPERATING COSTS ( 2 0 0 5 8 977) (11 182 576)

Accumulated Surplus

R R

Balance at 31 March 2002 2 437 230 -

Surplus for the period ending March 2003 2 496 206 2 437 230

Balance at 31 March 2003 4 933 4 36 2 437 2 30

Surplus for the year ending March 2004 347 691 2 496 206


CASH FLOW STATEMENT FOR THE YEAR ENDED 31 MARCH 2004

1 1CASH AND CASH EQUIVALENTS AT END OF THE YEAR 832 858 484 040

NOTES TO THE ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2004

2 0 04 2 0 03

Notes R R

CASH FLOWS FROM OPERATING ACTIVITIES 1 349 535 1 962 621

Cash generated by operations 10 1 031 767 1 466 573

Interest received 317 768 496 048

CASH FLOWS FROM INVESTING ACTIVITIES (1 000 717) (2 118 759)

Property, plant and equipment - acquired (1 000 717) (2 118 759)

Net (decrease) / increase in cash and cash equivalents 348 818 (156 138)

Cash and cash equivalents at beginning of the year 484 040 640 178

1. ACCOUNTING POLICIES

The financial statements are prepared on a historical cost basis and incorporate the following principal accounting

policies, that have been applied on a basis consistent with the prior period.

These financial statements comply with generally accepted accounting practice.

1.1 Property, plant and equipment

Assets costing less than R2 000 are written off in the year of acquisition.

Property, plant and equipment are stated at historical cost less depreciation. Depreciation is calculated on a

straight-line basis at rates considered appropriate to reduce the cost of the assets over their estimated useful

lives.

The depreciation rates are as follows:

Computer equipment 33.33%

Office equipment 20%

Furniture and fittings 20%

Books 33.33%

1.2 Cash and cash equivalents

This figure includes monies held in call accounts as well as cash in the bank and cash on hand.


1.3 Revenue

Revenue comprises of funds transferred from Department of Public Works.

1.4 Expenditure

All amounts are recorded exclusive of value-added tax (VAT).

1.5 Financial instruments

Financial instruments carried on the balance sheet include cash and bank balances, receivables and payables.

Measurement

Financial instruments initially measured at cost.

Subsequent to initial recognition, these instruments are measured as set out below:

• Accounts receivable are stated at cost

• Cash and cash equivalents measured at cost plus interest income as it accrues

• Financial liabilities recognised at cost namely original debt less principal payments

Credit Risk - where one party to a financial instrument fails to discharge an obligation and cause the other party

to incur a financial loss.

Interest rate risk - where the value of a financial instrument will fluctuate due to changes in interest rates.

Offsetting of financial assets and liabilities - not recognised as a legally enforceable right, and will not be settled

on a net basis nor will the asset be realised or the liability settled simultaneously.

Gains and losses that arise from a change in the fair value of financial instruments are included in the income

statement in the period in which it arises.

1.6 Provisions

Provisions are recognised when the CIDB has a present legal or constructive obligation as a result of past

events; it is probable that an outflow of resources embodying economic benefits will be required to settle the

obligation, and a reliable estimate of the amount of the obligation can be made. Provisions are reviewed at

each statement of financial position date and adjusted to reflect the current best estimate.


The carrying values of property, plant and equipment can be reconciled as follows:

C arrying value Additions Depreciation C arrying value

at beg i nning of year at end of year

Computer equipment 1 621 572 387 072 ( 762 631) 1 246 013

Furniture and fittings 610 016 561 953 ( 214 825) 957 144

Office equipment 541 996 51 692 ( 120 381) 473 307

Books 77 9 73 - ( 38 981) 38 992

2004 2003

R R

3. STOCK

Stock of stationery on hand - 51 761

4. ACCOUNTS RECEIVABLE

Debtors Control 159 313 -

Deposits - 79 257

VAT refunds receivable 556 942 895 063

5. PREPAYMENTS

Rentals prepaid

Rentals prepaid are in respect of a lease agreement

entered into with the lessor whereby the entity undertakes

to refurbish the offices in lieu of 5 years free rental

2 851 557 1 000 717 ( 1 136 818) 2 715 456

716 255 974 320

2 543 252 1 740 980

2. PROPERTY, PLANT AND EQUIPMENT

2004 2003

R R

Cost Accumulated Net Cost Accumulate d Net

Depreciation Book Value Deprecia t i o n Book Value

Computer equipment 2 451 186 (1 205 173) 1 246 013 2 064 114 ( 442 542) 1 621 572

Furniture and fittings 1 234 162 ( 277 018) 957 144 672 209 ( 62 1 9 3 ) 61 0 016

Office equipment 625 169 ( 151 862) 473 307 573 477 ( 31 481 ) 541 996

Books 116 954 ( 77 962) 38 992 116 954 ( 38 981) 77 973

4 427 471 (1 712 015) 2 715 456 3 426 754 ( 575 19 7 ) 2 851 557


2004 2003

R R

6. ACCOUNTS PAYABLE

Trade payables 763 648 823 476

7. PROVISIONS

Carrying amounts Additional Amo unts Carrying amounts

a t beg i nning of year provisions applied at e nd of year

Audit fees 112 000 109 935 (132 216) 89 719

Bonus 96 464 344 581 (96 464) 344 581

Accruals - 153 398 - 153 398

Payroll liabilities 43 931 68 870 (43 931) 68 870

Provision for leave 93 351 40 615 (488) 133 478

8. OTHER INCOME

Income from 3R's Guide ( Rights, Responsibilities and Risks) 2 042 1 734

9. OPERATING SURPLUS FOR THE YEAR

Operating surplus is stated after taking into account the following items

of expenditure:

Auditors' remuneration

• Fees for audit

- current year provision 123 474 112 000

- prior period over provision (6 025) 24 814

Board expenses 184 467 189 474

Depreciation 1 136 818 575 1 9 7

- Computer equipment 762 631 4 4 2 542

- Furniture and fittings 214 825 6 2 19 3

- Office equipment 120 381 3 1 481

- Books 38 981 38 981

Employee costs 5 538 607 3 055 951

- CEO 630 856 585 205

- Other personnel 4 907 751 2 470 746

Professional services 9 455 779 5 208 596

Staff training 125 464 38 536

Staff recruitment 391 376 345 905

Rentals paid in respect of :

- Premises 757 575 170 200

- Telephone and other - 10 225

Other operating expenses 2 351 442 1 451 678

345 746 717 399 (273 099) 790 046


2004 2003

R R

10. RECONCILIATION OF SURPLUS TO CASH GENERATED BY OPERATIONS

Operating surplus 347 691 2 496 206

Adjustment for items not affecting the movement of cash

- Depreciation 1 136 818 575 197

Less: Interest received ( 3 17 768) (496 048)

Operating surplus before working capital changes 1 166 741 2 575 3 55

Working capital changes ( 134 974) (1 108 782)

Increase in stock, accounts receivable and prepayments (492 446) (2 206 315)

Increase in accounts payable 357 472 1 097 533

11. CASH AND CASH EQUIVALENTS

Cash and cash equivalents consist of cash on hand and

balances with bank including investments in call accounts.

Cash and cash equivalents included in the cash flow

statement comprise the following balance sheet amounts:

Bank 208 432 381 679

Cash on hand 1 671 3 975

Investments 622 755 98 386

12. COMMITMENTS

Amounts approved and contracted - outstanding

contractual obligations at year end. 2 593 100 6 784 794

Capital commitments - 270 331

Current commitments 2 593 100 6 514 463

13. INCOME TAX EXEMPTION

The cidb is exempt from income tax in terms of section 10 (1) (cA) (i) of the Income Tax Act

14. FINANCIAL INSTRUMENTS

Credit riskFinancial assets that could subject the Board to credit risk consist principally of cash at bank and cash equivalents, deposits and accounts receivable. The Board's cash equivalents are placed with high credit quality financial institutions. Accounts receivable is presented at cost.

Interest Rate RiskThe cash flow is not significantly affected by fluctuations in interest rates. All cash is placed with reputable financial institutions.

Fair valuesThe carrying amount of cash and cash equivalents, deposits, accounts receivable and accounts payable approximated their fair values due to the short-term maturities of those assets and liabilities.

Cash generated from operations 1 031 767 1 466 573

832 858 484 040


SCHEDULE TO THE ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2004

20 058 977 11 182 576

2004 2003

R R

OPERATING COSTS

Audit fees - external

- provision for current year 123 474 112 000

- prior period over provision (6 02 5 ) 24 814

Audit fees - internal 83 225 -

Advertising 17 600 20 17 4

Bank charges 11 368 1 5 0 0 9

Board member expenses 184 467 1 8 9474

Computer expenses 288 505 110 586

Conferences and seminars 1 8 0 118 159 886

Depreciation 1 1 3 6 8 1 8 575 197

Interest paid - -

- bank overdraft 333 338

- late payment to suppliers - 173

Insurance 121 203 39 459

IT service 71 078 52 197

Legal fees 3 250 4 200

Levies 36 855 16 641

Office supplies 45 318 13 873

Printing, stationery and postage 247 073 43 667

Professional services 9 847 155 5 593 037

Publications, books and subscriptions 158 337 270 380

Rent/Rates/Electricity/Security 757 575 180 425

Repairs, maintenance and cleaning 134 507 5 625

Salaries 5 153 411 2 883 656

- bonus 344 58 1 96 464

- leave pay 40 615 75 831

Sponsorships 24 500 -

Staff training & welfare 125 464 -

Telephone 327 187 130 152

Traveling and entertainment 600 985 569 318


Academic Institutions

Contractor Employer

Bodies

Emerging Contractors

Organised Labour

Financial Institutions

Sector

Department of Construction Management, University of

Port Elizabeth

South African Subcontractors Association

Technikons for Programmes in the Building Construction Industry

Pretoria Technikon

University of Pretoria

University of Stellenbosch

Building Industries Federation South Africa

Eastern Cape Master Builders Association

Gauteng Master Builders Association

South African Federation of Civil Engineering Contractors

South African Subcontractors Association

Southern African Institute of Steel Construction

African Builders Association of South Africa

Black Construction Council

Black Contractors Federation

Greater Soweto Business Chamber

NAFCOC - Limpopo

South African Women in Construction

Black Construction Council - North West Province

Building Construction and Allied Workers' Union

National Union of Mineworkers

Glenrand MIB Ltd

Khula Enterprise Finance Ltd

SME Investments

Theta Investments

Nominating Organisation

Prof JJ Smallwood

Prof PD Rwelamila

Mr M Massyn

Mr MJ van Rensburg

Prof E Horak

Prof DG Brümmer

Prof F Hugo

Mr B van Breda

Mr NF Maas

Mr NL Klopper

Mr PC Fourie

Mr SD Moffat

Mr R Lavarinhas

Mr G Roberts

Mr CH Waterson

Mr GB Steele

Mr JS Strydom

Mr P Rude

Dr HKJ MacDonald

Mr BJ Westcott

Mr H Rademan

Dr H de Clercq

Mr C Kadwa

Mr SL Moleshiwa

Mr S Sibiya

Mr K Dlamini

Mr J Shibambo

Mr MJ Skosana

Mr C Jiyane

Mr B Makhetha

Mr TT Tebeila

Ms KM Choma

Ms P Siphayi

Ms TH Manana

Mr SJ Marumole

Mr JK Mpe

Ms MC Ikaneng

Mr DHH Campbell

Mr M Mothibedi

Mr T Makhetha

Dr DHH Randall

Mr P Allsopp

Full Name

During 2004 ci b will call for nominations to appoint new Stakeholder Forum members as required by legislation.d


Members of the Stakeholder Forum

ci b thanks all stakeholders for their contribution during the past year.d

Local Government

Material Suppliers

Public Entities

Private-Sector Client

Bodies

Professions

Provincial Government

National Government

Individual

City of Tshwane

Ethekweni Metro

Aggregate and Sand Producers Association of South Africa

Association of Architectural Aluminium Manufacturers of

South Africa

South African Cement Producers Association

Southern African Bitumen Association

Waterproofing Federation of Southern Africa

Agrément South Africa

National Home-builders Registration Council

Transportek (CSIR)

Independent Development Trust

Airports Company of South Africa

Construction Education and Training Authority

National African Federated Chamber of Commerce and Industry

South African Property Owners’ Association

Association of Construction Project Managers

Chartered Institute of Building [SA]

Engineering Council of South Africa

Institute of Municipal Engineers of Southern Africa

South African Council for the Quantity Surveying Profession

South African Council for the Architectural Profession

South African Association of Consulting Engineers

South African Federation of Civil Engineering Contractors

South African Institute of Civil Engineers

Association of South African Quantity Surveyors

South African Institute of Architects

Department of Public Works - Limpopo

Department of Public Works - Gauteng

National Treasury

Department of Public Works

Nominating Organisation

Cllr SS Mhlongo

Mr KC Rosenberg

Mr K Barnett

Mr N Macleod

Mr N Pienaar

Mr HA Schefferlie

Dr GRG Grieve

Mr PA Myburgh

Mr CL Tintinger

Mr TT Knoetze

Mr PN Makgathe

Mr PJ Hendricks

Mr M Msiwa

Mr JR Neville

Mr TTC Dlamini

Mr J Mbetse

Mr A Diepeneroek

Mr C Israelite

Mr BJ Hindle

Mr M Deeks

Mr B Havenga

Mr LV Naude

Prof G le Roux

Ms R Naiker

Mr HP Silbernagl

Mr G Pirie

Mr RA Saxby

Mr HP Langenhoven

Mr DB Botha

Mr TT Goba

Mr RL Chauke

Mr O Narker

Mr LV van Wyk

Dr S Phillips

Mr C Mthombeni

Mr WM Dachs

Mr G Damstra

Full Name Sector


Celebrating 10 years of democracy

Construction Industry Development BoardTel: +27 (0)12 481 9030Fax: +27 (0)12 343 7153E-mail: [email protected]: www.cidb.org.zaPO Box 1027, Brooklyn Square, 0075Pretoria, South AfricaRegisters Helpline: 0860 103 353

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