Zulch Lötter, Graham Pirie and Naren Bhojaram Newly appointed President of CESA Zulch Lötter, presented his presidential message and theme for the year at a media function recently held in Johannesburg. Lötter addressed the state of our country’s infrastructure, detailing the four ‘burning bridges’; Government’s ability to deliver on the short and long term needs of South Africa and its people - ‘the four dilemma’s’; and CESA’s partnership and advocacy approach to government as per the Dinokeng Scenarios. He also discussed both international and local industry value systems and listed CESA’s Strategic Goals for 2010/11 that include advocacy, integrity, facilitation and capacity building. He strongly believes that CESA and its member firms are our country’s crucial, valuable and indispensible resource. Lötter stated that the short term (six month) outlook for many of CESA member firms remains positive. When trying to take a longer term view though, the picture for the industry is more uncertain and less positive than a year ago.
Lötter stated that when Dr. Ramphele was asked what she would regard as the single biggest requirement necessary to rectify these deficiencies, she replied that there are 3 attributes required namely leadership, leadership and leadership. Lötter believes that, “Not only the future of the citizenry of South Africa in general, but the future business environment of the private sector and our industry in particular, will be determined by how these dilemmas are addressed by ALL of us.” Against this background he went on to share CESA’s strategy and actions for the year(s) ahead. CESA and its members focus on the infrastructure development and maintenance needs of society. These needs by and large revolve around four main areas namely water and sanitation; energy; transportation; and accommodation both residential and commercial. Lötter states that in order to successfully manage the development and maintenance of infrastructure in these fields, three main ingredients are required namely experienced human resources, financial resources and natural resources. CESA’s primary focus includes advocacy; capacity building; and consultation and monitoring in order to develop and support their members, clients and decision makers to take responsible decisions with respect to the application of financial and natural resources. Dinokeng identified that the current “condition of South Africa” of self interest; operating in silos; and “walking apart” as unsustainable. The alternative where government takes the lead and initiative in all matters with the rest of us only following, the “walking behind” scenario is equally unsustainable. CESA fully endorses the preferred Dinokeng Scenario of “Walking Together” and playing an active part in building a well run South Africa and Lötter is confident that CESA is well aligned with this scenario. As far as ‘burning bridges’ are concerned Lötter believes that, “The lack of technical management capacity, particularly in the municipal and provincial government spheres is common knowledge and unless redressed, is likely to be the single biggest stumbling block to sustainable development and growth in our country.” Based on the information collected in 2005 by Alison Lawless, and adjusted to reflect the situation in 2010, it is estimated that the number of professionally registered engineers employed by government, in all tiers, has reduced from 5 100 serving 14 million people (outside the “homelands”) to an estimated 1 800 serving approximately 47 million people in the whole of RSA today. In 1980, 40% of professional engineers worked in the public sector. This percentage had dropped to 15% by 2005. In the same period the number of professional engineers in the consulting industry had increased from 30% to almost 50%. The first ‘burning bridge’ is that of Water and Sanitation and Lötter states that water demand in SA as a whole will exceed supply by 2025 and that on the Witwatersrand shortages are expected as soon as 2013. He believes that a comprehensive set of measures is needed to strengthen water services management systems in municipalities and that responsibility must be shared by citizens as well as government. The second burning bridge is that of Transportation and although we have a well maintained national road network our provincial and municipal roads require drastic action. The third bridge that of Energy needs no introduction and has taken centre stage for quite some time. Lastly rapid urbanisation will pose both big opportunities as well as big challenges. Lötter states passionately that, “CESA’s strategy and actions are aimed at enhancing the business environment for its members; it is not a short term approach. CESA, our Council and leading practitioners have an “unselfish” passion to ensure the long term sustainability of our country. The well staffed full time directorate of CESA is a hive of activity providing guidance, training and support to clients and members on daily basis.” He concludes by stating, “The basic needs in people’s lives are provided by engineers. The private sector and government need each other; government on its own cannot restore the burning bridges; neither can we. The consulting engineering fraternity needs to be nurtured – it is a national asset. |
||||||||||
Zulch Lötter, President of CESA is currently in the process of visiting all of the Organisation’s nationwide branches to present his message for the year. BORDER/KEI PRESIDENTIAL VISIT Ngqura Harbour
On the 4 March 2010, Zulch Lötter paid a visit to the Southern Cape Branch. During the morning, committee members of the local branch arranged visits to two prominent road works projects in the area, namely the recently completed Hope Street intersection and the Witfontein Road traffic circles. This was followed by a meeting with the George Municipality’s Municipal Manager and the Managers of the Civil Engineering and Electro technical Engineering Departments. After lunch the President of CESA had the privilege of viewing the Destiny Africa model and what is envisaged to happen in this prestigious project in George. This was then followed by a visit to the emergency water project at the Outeniqua Wastewater Treatment Works where waste water will be purified and pumped back to the Garden Route Dam. This process is in accordance with international practice known as indirect reuse of waste water. This project was scheduled for implementation around 2020, but the severe drought has brought the project forward by approximately 10 years. The highlight of the Presidential Visit was a joint CESA/ SAICE evening function at the Hyatt Regency Oubaai Hotel. This afforded the President the opportunity to present his vision for CESA during his tenure as President to member firms.
|
||||||||||
Consulting Engineers South Africa’s (CESA) strategic intent is to identify major infrastructural issues in the country and to work together with local, provincial and national authorities as well as industry bodies to resolve them for the benefit of the nation. CESA President Zulch Lötter states, “It is important that we use local consultants”. In his address on the state of the industry, CESA President, Zulch Lötter identified 4 burning bridges that require urgent attention. One of the burning bridges is Government’s lack of strategic technical maintenance planning at sub national and national levels. This is exacerbated by the outflow of qualified experienced technical staff from government departments and includes staff that have at least 10 to 15 years experience and have the ability to mentor. This has not been helped by the substantial growth in the industry and has resulted in crises in the Energy; Roads and Transport and Water and Sanitation Sectors. In this regard CESA has committed itself to ensuring that these issues are identified and Government is well informed. CESA is in the process of compiling a report on the State of Infrastructure in South Africa. The results of this report will inform the areas that require the most attention in order to enhance service delivery. We are all well aware of the Eskom crisis but could also be heading in the same direction with Water & Sanitation and Roads & Transport if something drastic is not done. A preventive maintenance programme is urgently needed to avert a potential crisis and CESA has the collective capacity of its members available to assist government to produce both a short term as well as long term solution. Graham Pirie, CESA CEO, believes that, “Government needs to take a long term view, depoliticize the process and and re-instate the career of the public servant. The current procedure of 5 year contracts for public servants is leading to lack of continuity and expertise which is proving detrimental to service delivery.” The Energy crisis is currently being addressed with the announcement by Eskom of an average 25% increase in the cost of electricity across the board. It is a fact that the price of electricity, just like water, in our country has been too cheap for too long with the result that both maintenance and increasing capacity have been neglected leading to the current crisis. Lötter states, “What is needed is a mix of interventions including privatization, CESA member firms know how to assist and partner with Eskom.” On the negative side, the price increase will have an effect on the man in the street, but on a positive note corporate and industrial clients will make a move towards improving their efficiency as they possess the ability to adapt resulting in a positive change to the energy sector. Demand side management is taking centre stage. For years Eskom has had a price monopoly resulting in inefficient practices as external sources of energy have always cost too much. Independent Power Providers (IPPs) have effectively been kept out of the market but the structure is finally changing resulting in increased competitiveness. The positive spinoff of the increased tariffs is that many opportunities now exist as the industry has not developed to its full potential. As far as Consulting Engineers are concerned in the past Eskom has had a preference for using overseas consultants but CESA is pleased to report that there has been a shift to local consultants. Lotter states that for IPPs the current regulatory environment requires urgent attention. He states that Eskom has a 20 year energy project pipe line. Their Integrated Resource Plan I (IRP I) is in operation but he believes that IRP II needs to be expedited. Government needs to stimulate the implementation of available alternative technologies, e.g. solar water heaters. |
||||||||||
The results of the bi-annual Consulting Engineers South Africa (CESA) Economic and Capacity Survey for the period July to December 2009 just released indicate that conditions in the consulting engineering industry continue to become more challenging, and as expected weakened considerably during the last 6 months of 2009. Fee income fell by 8% compared to the first six months, or by 16,9% y/y adjusted for inflation (CPI). Most firms expected tighter conditions in 2010, and projected an average 2% drop in earnings during the first 6 months of 2010. Conditions in the last 6 months of 2009 were not as bad as expected, shown by the improvement in confidence levels, as well as a softer than expected decline in earnings. The industry’s ROI (unweighted average) increased from 47,8% to 65.8% with the majority of firms reporting a ROI of between 20% and 100%. Fee earnings outstanding from local government have increased to 16% of total earnings, the highest level since the December 2004 survey when fees outstanding escalated to over 14%. Fees outstanding for provincial government rose to 27%. A sharp increase reported by larger firms in fees outstanding from foreign clients increased the overall rate to 18,5%. This means the consulting industry is hit twice as hard, on the one side, by a contraction in demand and on the other side, a tendency by clients to withhold payments for work already completed. Late payments increased dramatically during the second half of 2009, mainly due to a sharp increase reported in foreign clients. Because of the prominence of the local government as a client to the consulting industry, it represents the bulk of late payments from the government sector, estimated at R430 million. Growth in gross fixed capital formation slowed to 1,2% y/y in the 3rd quarter, from 5,3% in the 2nd quarter and 11,8% in 2008. A decline in private sector investment particularly in new housing construction, machinery, equipment and transport contributed to the poor performance in gross fixed investment. Slower growth in non-residential construction will have a negative impact on gross fixed capital formation in 2010. The contribution of GFCF to GDP averaged between 20% and 22% during the last five quarters, a marked improvement from an average of 17% in 2005. Over the last four years there has been a substantial increase in fixed capital, necessary to support longer term and sustainable economic growth. Industry Outlook Investment in construction Human Resources Training Capacity Utilisation Industry challenges Quality Management System Directorate |
||||||||||
This year the 2010 Group of African Member Associations (GAMA) Conference and AGM was held at the Whitesands Resort in Mombasa, Kenya, a magnificent setting for our annual get together. Unfortunately, the overall attendance was not what is should have been due to the late finalisation of the programme. All in all 114 delegates registered and 11 member associations were represented from across the continent. The business programme provided some informative input and the usual networking opportunities. After introductions by the local ACEK Chairman and the FIDIC President, the Conference was formally opened by Prime Minister Engineer, Raila Odinga, one of the very few Engineers from across the planet holding such high office. The Prime Minister stayed for the day and took note of the key issues affecting African Consultants and undertook to use the African Union as a conduit to address them and advised that we all do the same. A number of Ministers also attended. It was refreshing to receive input from a Prime Minister who really understood the value and importance of the Consulting Engineering industry to a stable and growing economy. Tourism, a mainstay of the economy was now returning to normality after a major decline caused by the recent violence in Kenya, requiring large investments in related infrastructure. Kenya’s vision 2030 is to take the country from a struggling third world player into the future and, in so doing, recognises the need to develop science and technology capacity where engineers are the key player. A key aspect in this process is to preserve the environment and make sustainability a priority as well as to engage actively with the younger generation of Engineers. “The African people must take stock and lead the development of the continent”. He queried why the richest continent is also the poorest? He would like to implement the dream of Cecil Rhodes as symbolised by the Cape to Cairo Railway and he emphasised that this could only happen if corruption is eradicated. The Kenyan Minister of Roads said Kenya’s goal was to achieve the millennium development goals by 2015 and to do this, PPP’s had to become more prevalent in the delivery process. As in South Africa, he cautioned that there are many who masquerade as Consulting Engineers and their Engineers Act has been revived to promote good governance, integrity and CPD as well as to regulate and register not only individuals, but firms as well. There were a number of papers such as Why Engineering Structures Fail; Issues and Challenges Facing Consultants in Africa; The Consulting Engineer in Global Economic Recession; the Consulting Engineer and Strategic Infrastructure Planning; and some more detailed presentations such as the Strategic Plan for the Roads Sector in Sudan. These presentations will be uploaded to the FIDIC website shortly and appear under Regional Groupings. During the Conference there was an appeal for local Consultants to build capacity and in so doing, throw off the yoke of being sub Consultants and rather to become lead Consultants with the assistance of client entities. Africa lags in developing local skills mainly because International Finance Institutions and public sector clients seem to give preference to overseas skills. A presentation by the FIDIC President dealt with the relationship between quality and price and queried “why do Engineers so willingly discount their fees knowing that they will be unable to deliver the quality?” FIDIC member firms collectively generate some $4.5trillion dollars annually of project values and FIDIC’s target is to obtain a membership of 100 member associations by their centenary in 2013. Currently membership stands at 84 member associations, 45000 firms and in excess of 1 million professionals with annual fees totalling R310billion. CESA is currently the 10th largest member association. FIDIC also predicts a global infrastructure upturn by 2011. A very successful workshop was held on the third day under the theme “Financing Africa’s Infrastructure Tomorrow – a business opportunity workshop” where there were speakers from the African Development Bank, our local Industrial Development Corporation and a speaker from the African Management Services Company (AMSCO) who spoke on the sustainable replacement of expatriate enterprises and capacity building through training programmes which is a project under the auspices of the UNDP. Finally, of note was the GAMA Executive’s agreement to support the creation of an African Green Building Council network to assist in the creation of local Green Building Councils in individual countries such as that created in South Africa. This initiative also has the support of the African Union of Architects. Graham Pirie
|
||||||||||
Limited agreement reached at COP 15 Climate Change Summit
Climate change task group would aim to map out industry strategies |
||||||||||
|
||||||||||
CESA is partnering with the South African Institute of Civil Engineers (SAICE) to launch the Candidate Academy that will support graduates on their road to professional registration with The Engineering Council of South Africa (ECSA). Brenda Lacey-Smith, Manager of CESA’s School of Consulting Engineering (SCE) states that the establishment of the Academy is being driven by Allyson Lawless, MD of SAICE’s Professional Development and Projects in order to rebuild the skills foundation of this vital sector. Graduate engineers need to be taken through the full 'project cycle' covering all the technical activities involved in civil engineering projects from engineering and re-engineering, through construction, to operations and maintenance. An indicator that this is not happening is that it now takes young engineers much longer to achieve their ECSA registration – thereby holding back their potential contribution to their companies and to economic development as a whole. While it was previously the norm to register after three to four years of solid workplace exposure, only about a quarter of today’s graduates achieve professional status by the time they are 30 years old. Addressing the gap between theory and application is to be the focus of the Candidate Academy. The Academy will provide both structure and content to help young engineers to develop workplace competencies, building them from their theoretical training through the ‘how’ of engineering projects and processes. This training will be exercise-based, starting with a brief refresher on the topic and leading into a guided practical learning exercise or project - a very different approach from current highly theoretical or advanced courses, aimed at assisting experienced professionals earn CPD points. SAICE and CESA have teamed up to provide technical and professional practice training through the Education and Training department of SAICE, and CESA’s School of Consulting Engineers. Technical training will focus on aspects that are fundamental to developing an engineering career. While the ECSA outcomes and forms are published for access by all, the ‘how’ of training graduates to achieve registration status is not that evident, and the management of the process is complex. A comprehensive package has been developed by the Candidate Academy to assist graduates and employers alike, including planning tools to make up a Workplace Training Plan – with digital enhancements to make the planning, tracking and reporting of activities easier to manage. A Portfolio of Evidence file is also available to offer safe and logical storage of all precious originals for future reference. An important offering includes a suite of courses aimed at the key role players in the ECSA registration process being:
The courses will be rolled out nationwide during April and May 2010. |
||||||||||
The YPF Gauteng Branches have embarked on a Saturday tutoring initiative at Crossroads Boys Home in Salvokop, Pretoria. Crossroads is home to some 35 boys and young men who were previously homeless. The Home was brought to the attention of the YPF when we were invited to present at a career day for the boys. It was after this experience that the YPF Gauteng Branches decided to launch a programme whereby YP’s could assist these young men with their studies and provide mentorship to them. Ramona Reddy (Stemele Bosch & Associates and the YPF Gauteng South Committee) took on the role of Champion for the project. Under her management, a regular tutorship programme was launched in September 2009. Every fortnight, YP’s have spent their Saturday morning helping the boys with their schoolwork. Some have even brought friends and partners along! YP’s have assisted with subjects such as Maths, Physics, Chemistry, Accounting, Computer Studies, Tourism as well as some basic skills such as reading. Says Ramona: “It has been long believed that the first six years of a child’s life are most critical when they are particularly vulnerable to their environment. When this childhood environment is corrupted by all sorts of abuse, neglect and unhappiness surely a child takes many years to undo the damaging effects of the destructive environment. I believe it takes just a few hours of someone’s time to help someone to slowly counter the negative effects of their childhood. The boys have positive feedback and are excited to have assistance with homework, career advice and the mentorship opportunity. As YPs we have much we can offer the home with this initiative.”
For more details, contact: Ramona Reddy (reddyr@sbajhb.co.za) |
||||||||||
CESA welcomes Deltek as new affiliate for practice management software With more than 12,000 customers worldwide, Deltek are the leading provider of enterprise applications for project-focused organisations. Deltek enables companies to maximise profitability and productivity, integrating all aspects of the businesses. Deltek products power a myriad of front and back office processes including accounting, billing, budgeting and control, resource planning CRM and proposal automation and HR management. CESA Welcomes Glenrand M•I•B as a new affiliate for insurance broking and risk advisory services Glenrand M•I•B provides expert insurance broking and risk advisory services and is a supplier of Household & Motor Insurance products for the individual. They insure 23 of the top 100 South African public companies, thousands of private owned businesses and individuals and pride themselves on their long-standing relationships with them. Sue Welch, Account Manager at Glenrand M•I•B states, “We are proud to be associated with CESA and through our large client base and market influence, have secured superior cover and preferential rates on Household and Motor Insurance to all CESA Members, offering a cost effective insurance solution in line with our brand promise of providing ‘service beyond expectation’.” For further details please contact Sue Welch on 011 329 1839 or email swelch@glenrandmib.co.za CESA Welcomes Leads 2 Business as a new affiliate for research, development and tender services Leads 2 Business provides researched information on new Developments and Tenders within the Built Environment; their service is aimed at Professionals, Contractors and Vendors. |
||||||||||
|
||||||||||
|