Categorized | B-BBEE

Sanral seeks to transform construction industry

Sanral will in future use its procurement and supply chain processes to transform the construction industry, break down monopolies and advance the broad participation of black-owned contractors and suppliers.

This was revealed by the Minister of Transport Joe Maswanganyi at a breakfast meeting in Johannesburg today where he unveiled the roads agency’s draft transformation policy.

“Sanral’s new transformation policy sets clearly defined targets for the participation of black contractors, professionals and suppliers in all projects commissioned by the agency,” Minister Maswanganyi said.

Skhumbuzo Macozoma, the CEO of the South African National Roads Agency (Sanral) said it is committed to go beyond the minimum requirements for transformation set by existing legislative and regulatory frameworks.

“Sanral plays a critical role in the construction and related industries,” said Macozoma. “We are keenly aware of the impact our procurement practices have on economic transformation, job creation and the lives of millions of people across South Africa.
“We accept the responsibility to use our procurement and supply chain processes to transform the construction industry and Sanral is confident that this will be a catalyst for a much broader-based participation of black-owned companies in the sectors.”

Future contracts will set requirements for the utilisation of labour sourced from local communities and favour the procurement of locally-developed materials, equipment and technology. “We want to break down the traditional monopolies in these supply chains,” said Macozoma.

The transformation policy was approved by the Board of Sanral and will now be canvassed with stakeholders including national and provincial government departments, the engineering and construction sectors, existing suppliers and contractors and labour. It covers the entire spectrum of Sanral’s procurement processes and proposes, amongst others, the following:

* On capital projects Sanral will only do business with companies that are at least 51% black-owned and with a minimum B-BEE Level 2 rating. A maximum of 15 tenders per year will be issued to a single company and contractors will be required to make use of Sanral-approved sub-contractors.

* The same provisions will apply for road maintenance projects to ensure the broad-based participation of local companies and communities. Special attention will be given to the procurement of innovative road furniture and road safety material from black suppliers.

* Concessions to manage and operate toll roads will only be awarded to companies with a 51% black ownership. To reduce monopolies Sanral will limit the number of contracts awarded to established and dominant industry players.

* Black real estate and property developers will be allocated all Sanral-related business on contracts below R100 million and the 51% requirement will apply for larger developments.

* Sanral’s transformation policy will apply to all sub-contractors in the fields of information communication and technology, professional services, finance and audit and marketing and communication. Contracts will also include detailed provisions for sub-contracting to small and micro enterprises.

Macozoma said Sanral will introduce a structured programme to provide support for emerging contractors and suppliers and to create partnerships with industry players which will contribute to the rapid growth of black companies in the construction sector.

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