1. Construction Industry Development Board (cidb) Strategic Plan, Business Plan and Budget - 2010/11 and MTEF- Presentation to the PPC Friday, 12 March 2010 development through partnership

2. Presentation Outline Overview(background information) –Legislative Framework & Mandate –Vision 2012 and Beyond, Mission and Strategy External Context for 2010/11 Internal Context for 2010/11 Strategic Objectives Operational Plan Key focus for 2010/11 Performance measurement Budget development through partnership

3. Overview: Legislative Framework & Mandate development through partnership CIDB Act 38 of 2000…mandates the cidb to  provide strategic leadership to industry stakeholders to stimulate sustainable growth, reform and improvement  Regulate the construction industry

4. Dual responsibility of cidb An enabler/developer -since inception A regulator/enforcer of compliance – a focus being prioritised Change of emphasis critical to demonstrate value-add in the industry, requires specialist human resources and funding- hence now prioritised Implications of Distilled Mandate development through partnership

5. Legislative Framework & Mandate  CIDB Act 38 of 2000…mandates the cidb to establish the National Register of Contractors (RoC) which:  Facilitates public sector procurement, delivery and risk management  Supports contractor development  Promotes better performance - improved quality, safety, health and environment.  The RoC categorises contractors in accordance with their capability Overview: Legislative Framework & Mandate Fundamental instruments

6. RoC-Benefits  Support risk management in the tendering process  Reduce the administrative burden  To facilitate sustainable growth and transformation of contractors, enable effective access by the emerging sector  Reduce tendering costs to clients and contractors  Promote minimum standards and contractor best practice  Enable access by the private sector  Provide information on the size, distribution, nature and development of contractors  To improve the performance of contractors Overview: Legislative Framework and Mandate development through partnership Fundamental instruments

7. development through partnership Legislative Framework & Mandate  CIDB Act 38 of 2000…mandates the cidb to establish the National Register of Projects: Overview: Legislative Framework & Mandate Gather information on the nature, value and distribution of projects Provides the basis for a best practice project assessment scheme Promote the performance of public and private sector clients Fundamental instruments

8. Vision & Mission: Vision 2012 and Beyond “A dynamic, innovative and development organisation that provides strategic leadership and an efficient service to stakeholders, leading to a transformed and competitive construction industry that delivers quality infrastructure, promotes economic growth, and an organisation that is caring for its employees”. Progress and building momentum development through partnership

9. Vision & Mission: Mission “To direct and drive an integrated construction industry development strategy that transforms the role of industry and stakeholders for sustainable growth, improved delivery, performance and value to public and private sector clients, and investors through strategic partnerships; to strategically and deliberately promote the empowerment of small, medium and micro enterprises to improve their capability and grow the economy; to develop employees to be meaningful participants in the organisation”. Progress and building momentum development through partnership

10. External Context: Supporting interventions Infrastructure delivery skills Public sector delivery Stakeholder Analysis & Management 5 – Year Review recommendations Progress and building momentum development through partnership

11. External Context development through partnership Empowerment Delivery Performance Growth Capability

12. External Context The cidb Construction Industry Indicators (CIIs): –Clients were neutral or dissatisfied with the performance of contractors on 18% of the projects surveyed –Around 12% of the projects surveyed had levels of defects which are regarded as inappropriate –......

13. External Context The cidb Construction Industry Indicators (CIIs): –Contractors were neutral or dissatisfied with the quality of tender documents and specifications on around 26% of the projects surveyed –Contractors were neutral or dissatisfied with the management of variation orders on 31% of the projects surveyed –57% of payments to contractors were made 30 days or longer after invoicing –......

14. Internal Context: Operation and growth of RoC-see graphs and tables following this slide Specialisation Risk Exposure and Risk Management Business Systems- –EDMS –CRS Software Upgrade Progress and building momentum development through partnership

15. 15 Stats- Exponential Growth Increase in registrations  Dec 2004 – 1500  Dec 2005 – 7500  Dec 2006 – 27500  July 2007 – 42000  Dec 2007 – 55 000  End March 2008 > 65 000; End March 2009 >80 000; Jan 2010>100 000

16. Class of Works by grading There have been 5, 637 upgrades on the Register to date. Black owned enterprises constitute 84% of all upgrades.

17. Grading by Province – 29 January 2010 National & provincial targets

18. Actual no. of companies registered

19. Black owned by Grade only 43405787 75% Medium sized contractors (Grades 3 to 6) of which 75 % are black owned

20. Strategic Objectives: Organisational Capacitation –Recruitment & Retention –Benefits “Value-added” service delivery Research and Development Agenda Phase II of the Registers Procurement Reform Improvement of systems Facilitation of training and Contractor development Progress and building momentum development through partnership

21. OPERATIONAL PLAN & STAFFING STRUCTURE development through partnership Structure and purpose of programmes

22. Operational Programmes: Programme 1: Growth and Contractor Development(GCD)- focuses on promotion of enterprise development, investment and spending as the basis for a stable, developing industry and the participation of the emerging sector. development through partnership Structure and purpose of programmes

23. Operational Programmes: Programme 2: Construction Industry Performance- focuses on improved performance and best practice for an industry that delivers reliable value to clients, investors and end-users, information on construction industry indicators to inform cidb strategy, policy makers and stakeholders. development through partnership Structure and purpose of programmes

24. Operational Programmes: Programme 3: Procurement and Delivery Management- focuses on enhanced public sector construction procurement and infrastructure delivery management capability of public sector clients enabling efficient and effective delivery of quality infrastructure to the public. development through partnership Structure and purpose of programmes

25. Operational Programmes: Programme 4: Construction Registers Services focuses on: –Registration of contractors and both public and private sector projects –Regulation to effect improved performance and best practice of clients and suppliers. development through partnership Structure and purpose of programmes

26. Operational Programmes: Programme 5: Chief Executive’s Office focuses on: –overall strategic leadership and governance in support of the Board; –stakeholder consultations and communications. development through partnership Structure and purpose of programmes

27. Operational Programmes: Programme 6: Corporate Services, responsible for: –financial management including registers fees; –human resource administration-HR Admin; –supply chain management-SCM; –information technology-IT. development through partnership Structure and purpose of programmes

28. Key Focus for 2010/11 Contractor Registration –Continuous improvement of registration process –Regulation amendments Project Registration –Continuous improvement –To support the development of the new revenue model vs Phase 2 of registers (ie Best Practice) Develop revenue model-consultation development through partnership

29. Key Focus for 2010/11 Continue with public sector procurement reform – streamlining, public sector capacitation, etc Register of Professional Service Providers (RoPSP)-reviewing approach Compliance enforcement-NB! Public sector delivery improvement – continue with IDIP(Infrastructure Delivery Improvement Programme), including focus on municipalities development through partnership

30. Key Focus for 2010/11 National Infrastructure Maintenance Strategy – NIMS- reviving and setting up for 2010/11 onwards as soon as budget ready Phase II of the Registers-Best Practice –Quality –H&S –Environment development through partnership

31. cidb Best Practice Registers Best Practice Contractor Recognition Scheme Best Practice Project Assessment Scheme Laying the Foundation for Performance Improvement

32. cidb Best Practice Contractor Recognition Scheme The cidb Act (Act 38 of 2000) requires that the Board must, within a reasonable period after the establishment of the register of contractors, establish a Best Practice Contractor Recognition Scheme which: –enables organs of state to manage risk on complex contracting strategies –promotes contractor development in relation to best practice standards and guidelines developed by the Board

33. Key Focus for 2010/11 development through partnership 9292 SANS / ISO / OSHAS Management Systems AND Supply Chain Development Enablers; Business, H&S, Quality, Env, etc Grade cidb Accredited Management Systems cidb Competence Assessment Results Performance Reports cidb Best Practice Contractor Recognition Scheme

34. Key Focus for 2010/11 development through partnership cidb Best Practice Project Assessment Scheme 9292 Best PracticeValue Construction Management Plans PUBLIC SECTOR Standard for Uniformity PUBLIC SECTOR Performance Reports PUBLIC SECTOR Energy Efficiency PUBLIC SECTOR Skills / ESDA PUBLIC & PRIVATE

35. cidb Best Practice Contractor Recognition Scheme After a date determined by the Minister, the following will be required to be taken into account as a quality factor (functionality) in construction procurement on all public sector contracts: –cidb accreditation of a contractor’s competence or CMS –information contained in cidb contractor performance reports Clients can implement recommendations before the date determined by the Minister

36. Key Focus for 2010/11 Establish ESDA: funding, operation- applied for NSF funding, due dilligence done- all depends on funding. HR Development Improved internal audit process, Risk Management & Corporate Governance EDMS(electronic document management system) Project Database development through partnership

37. Key Focus for 2010/11 Contractor Development: –Revised framework - National Contractor Development Programme -NCDP CD Forums –W/shops with Provincial DPWs/other infrastructure departments/entities New Construction Contact Centres (CCC): LIMPOPO-official launch now postponed but office operational already; NW-establishment likely in 2010/11 Phase in value-add through all CCCs development through partnership

38. Key Focus for 2010/11 Stakeholder Forum (SF) 2010 Nominations for new SF Members –only in Oct 2011 Provincial stakeholder workshops Assist with appointment of 4th Board by Minister, –August 2010, advert by cidb –Minister to appoint, wef middle December 2010 5-year review recommendations-through to end of 2011/12 development through partnership

39. Performance Measurement Output targets set for each focus area (Section 6 of Business Plan) Example development through partnership

40. Performance Measurement development through partnership PurposeTo determine, establish and promote improved performance and best practice of public and private sector clients, contractors and other participants in the construction delivery process Measurable ObjectiveImproved performance and best practice for an industry that delivers reliable value to clients, investors and end-users, information on construction industry indicators to inform cidb strategy, policy makers and stakeholders. Key Policy PriorityConstruction industry performance Expected Outcome Improved performance and best practice for the construction industry. Strategic ObjectiveOutputPerformance IndicatorTarget 2010/11Target 2011/12Target 2012/13 Institutional SupportOn hand support to national and international structures. Participation in national and international structures:  Green Building Council of South Africa (GBSA)  UNEP Sustainable Building and Construction Initiative (UNEP-SBCI) 4 GBCSA meetings by March 2011. 2 UNEP-SBCI meetings by March 2011 4 GBCSA meetings by March 2012. 2 UNEP-SBCI meetings by March 2012 4 GBCSA meetings by March 2013. 2 UNEP-SBCI meetings by March 2013 Status Reports & SurveysMonitored industry performance. Ongoing monitoring of industry performance and dissemination of:  cidb Construction Industry Indicators (CIIs)  cidb Quarterly Monitor  cidb SME Business Conditions Survey CIIs annually Quarterly Monitor BCI quarterly CIIs annually Quarterly Monitor BCI quarterly CIIs annually Quarterly Monitor BCI quarterly Obtainable status reports.Development of status reports:  Construction Quality (initiated 2009/10)  Workplace Conditions (draft) 1 printed by March 2011 1 draft produced by March 2011 1 printed by March 2012 1 draft produced by March 2012 1 printed by March 2013 1 draft produced by March 2013 PROGRAMME 2: CONSTRUCTION INDUSTRY PERFORMANCE

41. 2010/11 BUDGET, INCL MTEF PERIOD development through partnership

42. Focus of 2010/11 Budget Building human resource capacity HR Development Establishment of a cidb provident fund Establishment of last Construction Contact Center/s-NW Improve value-add at the Construction Contact Centres Improvement of Registers service delivery development through partnership

43. Focus of 2010/2011 Budget NIMS staffing and operationalisation Focus on fraud and corruption/forensics Enforcement of compliance Facilitating the establishment of the ESDA Phase II of the Registers (Quality, H&S, Environment)-Best Practice-piloting in 2010/11 Promotion of R&D agenda: consultation, seed funding, etc Academic institutions to teach cidb requirements- consultative process EDMS-prioritised development through partnership

44. Focus of 2010/2011 Budget Stakeholder management Upscale communication: media/stakeholders/etc – to ensure cidb’s role is understood –The development of contractors within the cidb framework is to be done by clients –The cidb only reviews grade after completion of projects –The cidb’s success will only be achieved through solid partenships with clients (departments/SOE’s and municipalities) –The cidb has prioritised its facilitative role in training and contractor development ICT-hub of operations eg registers software rewrite – major requirement development through partnership

45. Summary Budget (kR) (MTEF)

46. Thank You ………..Thank you development through partnership