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Fransman Announces Koeberg Interchange Starting Date - A New Model for Transformation of Construction Industry

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Fransman Announces Koeberg Interchange Starting Date - A New Model for Transformation of Construction Industry

by Ministry of Transport and Public Works (PGWC)
24 Apr 2008
Cape Gateway
Cape Gateway

The date for the long anticipated makeover of the Koeberg Interchange has been set. "It's May 8," Transport and Public Works MEC Marius Fransman announced today. And he added: "Over the next 24 months, my Department's road division will be spending R690-million on a project that will dramatically ease traffic flow congestion - into 2010 and beyond."

But Mr Fransman also had some more news - news that will be widely welcomed by supporters of Black Economic Empowerment (BEE), but which will be somberly reflected on by a range of (still) predominantly white construction companies, especially those who have been paying lip service to transformation over the past 14 years.

"Koeberg reflects a new approach by the Department of Transport and Public Works to the construction industry," the Minister said.

"I am tired - and I'm not shy to say this - gatvol - of the slow pace of transformation in this industry. We've been talking nicely to those we've considered role players about our vision for this province, and some of them have been standing next to us on podiums, smiling and holding our hands, and saying: 'Let us move forward together for the benefit of all the citizens of the Western Cape.

"But what has been the reality? The reality is that if we'd decided to do business the old way, BEE companies would have benefited to the tune of about 5 percent on a R690-million project such as this.

"And that is laughable. My Department will not promote white elitist companies.

"Koeberg has given us the opportunity to give proper recognition to the skills levels that we know are in the Western Cape. And this time, we intend using that opportunity - to benefit as many people as possible in this province, and to enhance the main objectives of the government that I represent.

"These objectives should be obvious to everyone: to create jobs - and to fight poverty."

"A number of HDI targets have been set in the tender contract that we've signed with Paardeneiland Joint Venture. These targets will help us to realize these objectives. For instance, local subcontractors are set to benefit to the tune of R100-million. Of this amount, 10 percent - or R10-million must go to women. About 500 hourly-paid workers will be sourced from the poorest areas in the vicinity of the project.

Regarding procurement, about R150-million of all procurement will be sourced from local black suppliers," Mr Fransman said.

The MEC added that his Department had adopted a multilevel approach to the developmental model for Koeberg and beyond.

"We want to - and we will - ensure that the little guys who tend to be at the bottom of the pile in the construction industry can grow in terms of their BEE status.

"We believe that power should not still be concentrated in white hands. We intend pushing transformation at all levels.

"We are trying to create a new redistribution of growth in the construction industry in terms of BEE - and in this respect, job creation and skills development are critical.

"As far as Koeberg is concerned, all the empowerment targets that government wants to achieve will be achieved. These targets are not grabbed from the air; it is all within the targets of the provincial economic strategy."

Mr Fransman said that the challenge was to take a first economy initiative and work towards using this to close the gap between the first and second economies.

"What we have done is unbundled Koeberg," he said

"What started off as one big contract has now become four contracts. That makes it more open - and this is the point we want to make. Koeberg has now become open to other, smaller contractors.

"In terms of Construction Industry Development Board (CIDB) gradings, grade levels that would normally not be able to participate, would now be able to participate.

The four contracts are:
  • Interchange construction
  • Table Bay Boulevard
  • Street lighting
  • Landscaping.
It is a work in progress that will be used for future development. It will become relevant for all new projects."

Mr Fransman said that jobs would be outsourced and he added that the Department has set out the areas from which supplies must be purchased.

"We've done a whole empowerment assessment on Koeberg," he said.

"We've even ring-fenced where the labour should come from. We've targeted the poorest areas in the Western Cape to work on the project.

"We've also included a condition in the contract that the contractor must provide suitable means of transport to get labour to and from work.

Mr Fransman said he was particularly excited about the fact that all temporary or local labourers would be given life skills and technical skills training. He said that these requirements would be determined in accordance with the Construction, Education and Training Authority (CETA) training programmes.

"The contract stipulates that at least two weeks must be set aside by the contractor to allow workers to attend these training programmes."

"Ten candidate roadwork learnerships per year will also be allocated to this project from the provincial government of the Western Cape's Learnership 1000 programme," Mr Fransman said.

"Of course, we've wanted this to be a labour intensive construction. And so we have insisted that where practical and economically feasible, construction work should be undertaken using labour-intensive methods.

"Some of these activities will include:
  • Excavations;
  • Subsurface drains;
  • Cleaning of drains;
  • Patching;
  • Crack sealing;
  • Installation of mole barriers;
  • Loading of material into trucks;
  • Erection of temporary traffic-control facilities;
  • Erection of temporary road sings; and
  • Cleaning and trimming of road reserves.
"On May 8, we will enter era. It will be a case of business unusual, where it will no longer be a case of white companies simply supplying material, with no one saying a word. We will seriously look at the BEE status of companies."

Issued by:
Dougie Oakes
021 483-2200
083 658 7636

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