Laws put obstacles in the way of BEE – Richards

Patrick Cull

NATIONAL legislation created “significant obstacles” in the path of the Nelson Mandela Bay municipality‘s reaching its targets in terms of tenders awarded to advance broad- based economic empowerment, municipal manager Graham Richards said yesterday.

Richards was replying to questions at yesterday‘s oversight committee meeting as to why the metro had failed to meet its black economic empowerment targets. The annual report reveals that in 2007/08 the metro awarded 39 per cent of tenders to previously disadvantaged individuals against a target of 60%.

He said the metro had “ring-fenced” projects for 100% black-owned companies but this had been declared “unconstitutional” by the High Court in three cases where it had been challenged, adding that the national Treasury had stated it would investigate this matter “but no progress had been made”. Richards called this a “significant obstacle”.

He said the Construction Industry Development Board provided a further challenge.

The CIDB regulations dictate that contractors with low grades are barred from tendering for projects worth upwards of R3-million.

More than 80% of black contractors fall below CIDB grade 2 and this means that they only qualify for a small number of tenders.

Richards said to address this the metro was constructing tenders so that they should be responded to by consortiums – a joint venture that included a contractor at grade 2 level who could in this way gain experience.