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A Third Consecutive Decrease

Persistent Rise in Inflation Is Worrying, Says SEIFSA

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Johannesburg, 12 December 2018 – The Steel and Engineering Industries Federation of Southern Africa (SEIFSA) is disappointed by the latest Consumer Price Index (CPI) figures, which indicate that inflation increased further in November 2018, despite the  decision by the South African Reserve Bank to raise the repurchase rate by 25 basis point to 6,75% from 6,50% last month in an effort to  contain inflation within the mid-point of its 3-6 percent target band.

The CPI figures released by Statistics South Africa (StatsSA) today indicate that the annual consumer price inflation increased to 5.2 percent in November 2018, from 5.1 percent in October 2018. On a month-on-month basis, the CPI increased by 0.2 percent in November 2018.

SEIFSA Economist Marique Kruger said given that the demand for the Metals and Engineering (M&E) cluster’s intermediate products is a derived one based on consumer spending, the persistent rise in inflation is cause for concern.

However, Ms Kruger said the increase in the CPI was expected going into the festive season, underpinned by a seasonal pattern of higher consumer spending, galloping November fuel prices and a generally upward-trending Producer Price Index (PPI) for both the intermediate and final manufactured goods. The concern is that the increasing trend in inflation is likely to continue in the near term, compelling consumers to cut back on spending for final manufactured goods which warrant the use of intermediate manufactured products of the M&E cluster of industries as inputs.

“The latest inflation data is disappointing and does not augur well for businesses in the M&E cluster of industries and the broader manufacturing sector. The concern is that companies will continue to face headwinds, including higher interest rates, operational expenses and inflationary intermediate inputs costs,” Ms Kruger said.

In addition, she said it was worrying that the PPI data to be released tomorrow is likely to maintain its upward pressure on inflation.

SEIFSA closely monitors the release of both the CPI and PPI data for final and intermediate manufactured goods, amongst other indicators of its price and index pages (PIPS), due to their importance to the M&E sector. Both indices are used by companies in the secto in financial decision-making processes towards costs mitigation r through, for instance, Contract Price Adjustment processes.

In conclusion, Ms Kruger said despite the difficult operating environment, companies should capitalise on the prevailing signs of a silver lining to build on lower fuel prices for December and slowly improving domestic demand, reduce operational costs and positively boost margins and profit levels.

Issued by:

Ollie Madlala

Communications Manager

Tel: (011) 298 9411 / 082 602 1725

Email: ollie@seifsa.co.za

Web: www.seifsa.co.za

SEIFSA is a National Federation representing 23 independent employer
Associations in the metals and engineering industries, with a combined membership of 1600 companies employing around 200 000 employees. The Federation was formed in 1943 and its member companies range from giant steel-making companies to micro-enterprises employing fewer than 50 people.

Improving M & E Production Is Encouraging, says SEIFSA

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Johannesburg, 11 December 2018 – The Steel and Engineering Industries Federation of Southern Africa (SEIFSA) welcomes the preliminary production data for the Metals and Engineering (M&E) cluster of industries released by Statistics South Africa (Stats SA) today.

“The data, which reflects an increase in output for October 2018, augurs well for both the cluster and the broader manufacturing sector,” the Federation’s Chief Economist, Michael Ade, said this afternoon.

After adjusting for the sectoral weights, the preliminary seasonally-adjusted production data for the M&E sector indicated that output improved to 11,9 percent on a year-on-year basis in October 2018, when compared to October 2017. The improved performance is in line with an increase in production in the broader manufacturing sector, which also increased by 3,0 percent year-on-year in October 2018, following comparatively positive but lower output levels recorded in September 2018 and August 2018 respectively.

On a month-on-month basis, the M&E sector also performed well, improving from 0,3 percent in September 2018 to 9,3 percent in October 2018. The sector’s improved monthly performance was mainly supported by higher output in the petroleum, chemicals, rubber and plastic products (1,8 percent) and the basic iron and steel, non-ferrous metal products, metal products and machinery (1,7 percent) sub-industries.

“Against the backdrop of a slowly improving economy, the improvement in production for the cluster is encouraging. Evidently, producers were able to take advantage of a brief strengthening of the rand to capitalise on the importation of cheaper intermediary inputs, leading to the best increase in manufacturing production since the start of the year,” Dr Ade said.

He said the sector’s performance also coincides with an improved pace of the real Gross Domestic Product (GDP) growth, which surprised on the upside during the third quarter of 2018, officially moving the domestic economy out of a technical recession and providing impetus for more output, investment and employment.

Dr Ade said it is very important that the sub-components of the M&E cluster continue to expand, given the need to continuously improve on overall job numbers in the broader manufacturing, which is still a cause for concern. The latest Quarterly Employment Statistics numbers released by Stats SA earlier today shows that manufacturing employment decreased by 0,6% or 7,000 jobs quarter on quarter in June 2018 to September 2018, despite the sector’s positive contribution to GDP growth in the same quarter.

Dr Ade said this highlights the need to maintain the output growth momentum towards better employment numbers.

Dr Ade said that he hoped that the encouraging increase in domestic growth will translate to higher demand for intermediate and final manufactured goods, which will invariably have a positive impact on production and employment within the manufacturing sector. He noted that, importantly, businesses are optimistic that the recent slowdown in fuel prices will also have a positive impact on companies’ logistics costs in the short term, thus enabling an up-tick in business activity to the expansionary zone.

“These dynamics are encouraging and SEIFSA is optimistic that the basis for a continuous improvement in output going into the new year now exists for businesses to leverage on, and further expand,” Dr Ade concluded.

Ends

SEIFSA is a National Federation representing 23 independent employer  Associations in the metals and engineering industries, with a combined membership of 1600 companies employing around 200 000 employees. The Federation was formed in 1943 and its member companies range from giant steel-making corporations to micro-enterprises employing fewer than 50 people.

 

 

SHEQ Legislation

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HEALTH AND SAFETY LEGISLATION REVIEW

 

1. Occupational health and safety

A. Occupational Health and Safety Amendment Bill

For reasons unknown, there has been a delay in the publishing of the Draft Occupational Health and Safety (OHS) Amendment Bill for comment. Nedlac deliberations had commenced in October 2014 and concluded in March 2016.

 

The following Regulations were published for comment:

– Draft Ergonomics Regulations

– Draft Asbestos Abatement Regulations

– Lift, Escalator and Passenger Conveyor Regulations Incorporation of the Code of Practice for Inspection and Testing of Lift

 

No regulations have been promulgated in 2018.

 

ENVIRONMENT LEGISLATION

Carbon Tax and Climate Change Bill

The 2017 Draft Carbon Tax Bill is a refinement of the initial 2015 Draft Carbon Tax Bill. The main aim of the carbon tax bill is to put a price on the environmental and economic damages caused by excessive emissions of greenhouse gases. A secondary aim is to change the behaviour of firms and consumers, by encouraging uptake of cost-effective, low-carbon alternatives.

Once the Bill comes into effect, the National Treasury will levy carbon tax on emissions above the absolute carbon budgets (a greenhouse gas emissions allowance allocated to a person over a defined time period). The Department of Environmental Affairs (DEA) is currently devising methodology for the level of the budgets. The DEA also published a Climate Change Bill which, once It comes to effect, will enable the enforcement of Carbon Budgets.

 

The business position on both Bills is that there is no reason for a developing country, whose GDP growth has remained below 2% since 2016, to have one of the most stringent environmental legislation in the world. Moreover, the imposition of carbon budgets where there are no alternative technologies is prejudicial towards business.

 

b. Industry Waste Management Plans

On 6 December 2017 the Minister of Environmental Affairs published a notice directing the following industries to submit industry waste management plans for approval:

Lighting

Electrical and Electronic Equipment and

Paper and Packaging Industry

 

This was after SEIFSA and BUSA raised flags against the previous notice, citing impractical requirements and compliance unachievable deadlines. The deadline for subscription to approved Industry Waste Management Plans was 6 September 2018. However, by August 2018, there had not been a single plan approved by the Minister. To this end, affected companies may find themselves unable to comply with this requirement. The SEIFSA SHEQ Executive continues to lobby on this matter and keeping the Associations informed.

 

SHEQ BUSINESS SOLUTIONS

ISO 9001 Quality Management Systems (QMS) is an effective tool for assuring quality of products. According to research, it increases the bottom line and enhances access to markets.

The SHEQ division provides consultancy and training services to assist with the implementation or improvement of  QMS.  ISO 9001 implementation is offered to small enterprises at competitive rates.

Quality related offerings include internal QMS audits are to evaluate the effectiveness of your system, and second party QMS audits to your suppliers to enhance your supply chain.

12 February 2019: Skills Development Planning and Reporting Seminar

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SEIFSA is proud to announce that due to popular demand we will be hosting SEIFSA’s Annual  Skills Development Planning and Reporting Seminar which is an informative and practical engagement platform where company delegates will be afforded the opportunity to engage experts and captains of industry about skills development challenges. The seminar in principle focuses on unraveling the skills planning and reporting requirements, criteria, templates, and policy with links to the National Skills Development Management System (NSDMS) as well as the implications, challenges and opportunities available to companies that are registered with the merSETA.

This collaborative workshop will provide you with guidelines and practical tools to ensure a successful Mandatory and PIVOTAL grant submission to the merSETA by 30 April 2019. This workshop affords you the opportunity to understand Merseta’s Grant Policy 2019/2020 and National Skills Development Management System (NSDMS). If you are interested in attending this annual learning and networking opportunity event with like-minded individuals please click here for more information

Skills Development CTA

About the workshop

Once again SEIFSA has joined forces with the experts to address the skills development reporting submission requirements for 2019/2020. This full day informative and practical engagement platform provides the knowledge and covers all the practical key elements of the merSETA’s reporting requirements in order to claim the Pivotal and Mandatory Grant including submission of the Workplace Skills Plan and Annual Training Report. This practical session includes the basic needs analysis tool process, workplace skills plan and annual training report submission requirements as well as the National Skills Development Management System (NSDMS) processes that are responsive to strategic business imperatives.

The presenters

SEIFSA has once again managed to harness a group of dynamic and well informed captains of industry to present various relevant topics at a micro and macro level that will benefit both you and your organisation.

  •  Kyle Mitchell, Honeycomb BBBEE;
  • Winston Adams, Merseta;
  • Imaan Hiebner, SARS;
  • Melanie Mulholland, SEIFSA; and
  • Preggy Chetty – Thuthukisa

Who should attend?

Members who are new to the skills development reporting requirements for pivotal and mandatory grants and who wish to ensure that they are at the forefront of effective implementation.

Skills development facilitators, human resource managers/practioners, training managers, managers, owners and managers of small and medium enterprises, experienced managers who would like to brush up on their knowledge and get to grips with the New Skills Development Management System (NSDMS).

PROGRAMME

08h00 – 09h00     Registration and refreshments

09h00 – 09h15    Welcome, introduction and setting the scene.  Melanie Mulholland, SEIFSA Human Capital & Skills Development  Executive

09h15 – 09h45    The BBBEE codes and its impact on skills development. Kyle Mitchell – Honeycomb (BBBEE Agency)

09h45 – 10h15     Maximising the Tax Benefits for Skills Development.  Imaan Hiebner– SARS, Regional Manager

10h15 – 10h45     Mid-morning refreshments

10h45 – 12h00    merSETA Perspective for 2019/20 reporting year. Winston Adams, merSETA

12h00 – 12h45    Lunch

12h45 –  13h30  Workplace Skills Plan (WSP), Annual Training Report (ATR) and PIVOTAL Plan and Report Templates,  Guidelines and NSDMS  – 
                              Melanie Mulholland, Human Capital & Skills Development Executive

13h30 – 14H15  Leveraging the Centers of Specilaisation Project (DHET) – and working with TVETs to train apprentices – Preggy Chetty – Thuthukisa

14h15 – 14H30  Closure 

Date/time 12 Feb 2019/ 09h00-15h00

Venue Country Club Johannesburg Country Club Johannesburg 1 Napier Road, Auckland Park, Johannesburg

Skills Development CTA

The workshop will cover

Understand the merSETA criteria and requirements for submission of the skills planning and reporting templates due on 30 April 2019

Highlight the benefits and uses of the New Skills Development Management System (NSDMS) for effective skills planning and reporting

Work through the New Skills Development Management System (NSDMS) templates including the PIVOTAL Plan and PIVOTAL Training Report

Understand the labour representative’s role in the approval process

Discuss the Training Committees’ role and responsibilities for the 2019/20 mandatory and pivotal grant submission requirements

Highlight and align current policy expectations and implementation objectives

Share insights with colleagues and peers

Participate in group discussions to gain from the best practice experiences of other companies. Network with other skills development facilitators and HR practioners so that you can handle skills development planning and implementation with confidence.

Included in the fees

Certificate of attendance

Refreshments

Lunch

Parking 

About IR and LS

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SEIFSA Industrial Relations & Legal Services

SEIFSA’s IR and Legal Services division has highly-skilled and experienced staff that are acknowledged industry experts. They have a specialised knowledge of collective bargaining, Bargaining Council agreements, dispute resolution, labour law and environmental and commercial law issues.

The IR and Legal team assists with:

  • Company-level IR policies, procedures and practices
  • General industrial relations and legal issues
  • Bargaining council agreements and exemption applications
  • Company-level disciplinary enquiries and appeal hearings
  • Dispute resolution
  • Legal Representation in the MEIBC, CCMA and Labour Courts
  • Conciliation and arbitration proceedings
  • Employee job grading
  • Retrenchments and short-time

Provides advice and training on issues pertaining to:

  • Collective Agreements
  • Basic Conditions of Employment Act (BCEA)
  • Employment Equity Act (EEA)
  • Labour Relations Act (LRA)
  • Employment Services Act (ESA)

SEIFSA’s experts are ready to advise, assist and represent management in all dealings with trade unions at company level, for example on:

  • Proposed employee retrenchments
  • Industrial disputes and strikes
  • Union demands for recognition and access

We negotiate company-level union recognition and procedural agreements and give written comments and advice on all company-level policies and documents – for example, on labour broking, employment contracts and disciplinary warning letters.

The assistance includes, but is not limited to drawing up IR documents, including documents relating to grievance and disciplinary procedures, working time arrangements, email and internet policies and dealing with absenteeism in the workplace. They also advise on the legitimacy of medical certificates.

Bargaining Council Matters
SEIFSA’s experts help to interpret and implement bargaining council collective agreements relating to:

  • Working conditions
  • Short-time
  • Retrenchments
  • Use of labour brokers
  • Pension and Provident Funds
  • Disability issues

We prepare exemption applications for companies from bargaining council agreements on:

  • Wage Increases
  • Leave Enhancement Pay

Job Grading
SEIFSA’s grading specialists visit member companies and grade employees’ jobs in accordance with bargaining council’s job grading structures.

Disciplinary enquiries
SEIFSA provides qualified and experienced experts to chair and run in-company disciplinary enquiries and appeals.

Legal Representative
SEIFSA provides Legal representation in the MEIBC, CCMA and Labour Courts

SEIFSA speaks for industry

Our senior IR staff is active in the formulation of employer bargaining strategies and tactics. We also participate directly in industry-wide negotiations with trade union representatives. SEIFSA negotiates all terms and conditions of the industry’s collective agreements – from wage increases, employment conditions and social security arrangements through to financial and administrative issues relating to bargaining council operations.

Corporate and Commercial Law Training and Advisory Services Including, but not limited to:

  • Advice and drafting of commercial contracts such as leases and agreements of purchase and sale, production, distribution, leases, sub-contracting etc
  • Advice in contractual disputes
  • Advice and guidance on corporate governance principles
  • Advice and guidance on business law principles
  • Advice and guidance on business rescue proceedings
  • Advice and guidance n Compromises
  • Advice and guidance on fundamental transactions and takeovers

The Industrial Relations and Legal services division now also offers retainer packages on all of the above issues.

Industrial Relations Workshops, also offered on an in-house basis

  • A – Z of the Metals and Engineering Industry Main Agreement workshop
  • Managing sick leave and absenteeism
  • Fair and effective discipline
  • Employment contracts and the Law
  • Understanding how to grade your scheduled employees
  • Retrenchments, Lay- offs and short-time
  • Effective Industrial Relations
  • Managing conflict and common problem areas effectively
  • Retrenchments, short-time and lay-offs

Legal services Workshops; also offered on an in-house basis

  • Chairing of disciplinary hearings: Doing it the right way
  • POPI Act
  • Managing incapacity and poor performance
  • Law of evidence
  • Business contracts and SLAs
  • Labour Law court processes
  • How To Tender Successfully, Untainted By Corruption – Beginner’s course
  • Key Aspects of Labour Law
SEIFSA

Economic and Commercial Consultancy

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The Economic and Commercial team offers consulting services in industry related matters aimed at improving business savvy and operational excellence, including:

  • Tender conditions
  • International trade issues
  • Conducts Economic Impact Assessments
  • Investment advisory service
  • Assist companies with in-house strategic sessions
  • Business plans
  • Exports strategy documents
  • Economic advisory/seminar
  • Economic consulting

For any consultation queries relating to EC contact the Team.

Dr Michael Ade: Chief Economist
011 298 932

Ms Marique Kruger: Economist and CPA Facilitator
011 298 9408

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