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The 7 Pillars of Financial Health – Partnering with a Professional to Thrive

What inspired you to write the book?

I have always enjoyed writing and as you know I write regularly for Blue Chip and have previously co-authored a book entitled Rethinking Leadership. About six or seven years ago, I began facilitating behavioural coaching programmes for financial planners and frequently got questions and queries about how the insights and ideas from these programmes could reach a broader audience. I thought the obvious way to do this was to write a book. When Covid struck my wife had just signed up to do a PhD so I took it as the perfect opportunity to begin writing the book.

Who do you want to read it?

When I initially began writing the book, I wrote it for the financial planner. I am a firm believer that financial planning is a noble profession that helps people make decisions about their life and money. Until now, the focus of financial planner education has been on the money and the technical aspects of the work, yet I believe human skills are critical to sound financial advice.

When I took the book to my publisher Vindigo Press, they questioned why I was limiting the audience to financial planners as they believed with a little more work it would be appropriate for anyone who was considering getting financial advice, or who worked with a financial planner. The response from both financial planners and the person in the street has been very positive. My hope is that financial planners will see the book as useful for themselves and their clients.

What do you think is unique about this book?

I think you could put personal finance books into three broad categories. First, those that provide advice on technical aspects of investing, financial and retirement planning. Second, those that offer lessons about how to handle your money, whether from stories about people and their money or the author’s life experience. Third, there are books that focus on the person and their behaviour, whether about life planning or informed by insights from behavioural finance, which educates us on our many biases and how they influence our approach to money.

My book is probably closest to this third category, but I believe is unique because it doesn’t only share information but also focuses on applying human skills, both intrapersonal and interpersonal, that are key to influencing behaviour, which I believe is the greatest determinant of financial health.

How would a financial planner find this book useful?

I hope it will challenge financial planners to look into the mirror and perhaps think differently about how they go about their work. There are also practical skills outlined in the book that financial planners will be able to apply immediately upon reading the book. These skills obviously require practice, but there is enough in the book to help a financial planner who wants to become more skilled on the human side of financial advice to practically implement new ways of interacting with their clients.

How would a potential or existing client of a financial planner find the book useful?

Firstly, to recognise that their financial health is not just about money and that the financial planning process provides clients with the opportunity to really think about what they want out of life. Secondly, that a successful financial planning outcome has more to do with our human skills, who we are and how we turn up in the world, than how much knowledge one has about money and finance.

Thirdly, a key message in the book is that a client will be better off working with a professional financial planner than going it alone but that clients can also work on their human skills to improve their financial planning outcome.

If there is one thing that you want the reader to take away from the book, what would it be?

Most importantly, I would like the reader to enjoy reading the book. I love reading, but not everyone does. So, if someone chooses to spend some of their valuable time reading the book, if nothing else I hope they will enjoy it. I also hope that the book is a catalyst for anyone who is hesitant about seeking financial advice, to engage the services of a professional financial planner.

Finally, I hope that financial planners will find the book a good resource for their work and that clients, or potential clients, recognise that financial planning is a noble profession and that their lives will be richer in all senses of the word by working with a financial planner.

Order a copy of 7 Pillars of Financial Health
Rob Macdonald, Head of Strategic Advisory Services, Fundhouse

Rob Macdonald has held several senior positions in the investment industry. At Fundhouse, he acts as a consultant and coach to financial advisors and develops and facilitates training programmes in behavioural coaching and practice management. Before joining the financial services industry, Macdonald was MBA director at the UCT Graduate School of Business.

He is co-author of the book Rethinking Leadership and has consulted, written and spoken widely on a range of topics.

Macdonald has a Master’s degree in Management Studies from Oxford University and is a CFP® Professional. 

Collaborating to put young people to work

YES4YOUTH gives young people work experience. Credit: YES4YOUTH

By John Young

It is in everyone’s interests that the rate of youth unemployment in South Africa comes down. StatsSA has published figures suggesting that as many as 60% of the 15-24 age group are unemployed. The rate for the 25-34 cohort is above 40%.

The single, simplest solution would be for the national economy to grow faster, but because making that happen is actually extremely complex, other solutions have to be found. And this is where collaboration between business and industry, the education sector and non-governmental organisations (NGOs) becomes vital.

Since 1998, South Africa has had Sector Education and Training Authorities (SETAs). These vocational-skills-training organisations were established by an act of parliament and there are currently 21 of them. SETAs create and manage learnerships, internships, short-course skills programmes and apprenticeships. SETAs are well placed to act as the linking factor between tertiary institutions and private companies or to ensure collaboration between NGOs and industry.

Every industry is covered by the SETA network and companies must contribute a skills levy to the appropriate SETA. This occurs within a National Skills Development Strategy.

Role of skills

Whether the goal is to prepare to work for someone else (get a job) or to encourage entrepreneurship (start a business), the need for skills remains essential.

Depending on the priority, the skills training programme would be biased in favour of work-specific skills (welding, computer skills, handling equipment) or business-related capabilities (keeping track of cashflow, marketing).

The South African Council for Graduates Cooperative (SACGRA) sets out to support both approaches, striving to develop both “competent graduates that can become successful entrepreneurs or competitive employees” and like many such hubs, SACGRA offers advice, mentorships and links to markets and opportunity. What makes SACGRA stand out is its focus on co-operatives.

Co-operatives are a successful model already widely adopted across South Africa for savings clubs known as “stokvels”. Old Mutual estimates that more then 800 000 such stokvels represent a value of R45-billion. SACGRA aims to professionalise co-operatives and prepare them to participate in two private-sector initiatives that have become a big part of the South African economic landscape, namely Supplier Development Programmes and Enterprise Development Programmes.

In terms of these programmes, large companies are obliged to or choose to help build up and train business owners (ED) which might be part of their supply chain (SD). The programmes often overlap, as it makes business sense for a large mining operation, for example, to have a successful local bus company supply its transport needs. The same would apply to cleaning and maintenance services, catering and many other categories. Given a steady client and a reliable income, these local businesses are much more likely to succeed in the long term and to create employment as they grow.

In launching MTN Xlerator in 2023, CEO Charles Molapisi explained how the scaled-up Enterprise and Supplier Development programme is intended to boost supply chains, drive economic growth and create jobs.

So widespread have ED and SD programmes become that national awards are now presented annually. The Business Day Supplier Awards has no fewer than 11 categories and an overall winner. That winner in 2021 was Tiger Brands, whose R100-million Dipuno Enterprise and Supplier Development Fund impressed the judges and which was cited as an illustration of the best kind of collaboration between the private sector, government, mining houses and their pipeline partners.

The financial sector has an important role in this environment. Old Mutual’s Masisizane Fund is geared to finance small, medium and micro-enterprises (SMMEs) and it is often to funds such as these that participants in SD programmes turn.

Venetia Mine, a De Beers Group mine in northern Limpopo, has more than 50 SMMEs enrolled in incubation programmes and 34 locally owned companies are doing business with the mine. This kind of cooperation creates jobs and can lead to expansion. A woman-owned business which was supplying accommodation on the mine is now in the process of expanding into the nearby town in the form of a hotel which will be in a position to grow its clientele beyond visitors to the mine.

Another example of collaboration across sectors that leads to employment is underway in the small Northern Cape town of Kuruman. Mining company Assmang is working with EduPower Skills Academy in a programme that combines skills training, enterprise development and community upliftment. Training is provided to potential call-centre operators while support is given to entrepreneur to set up a call centre. Once the trainees complete their 12-month learnerships, they are available to employed in the new business.

The country’s biggest private sector youth-employment programme is YES4YOUTH. The idea is for private businesses and corporates to take in young people for 12 months of work experience. Run since 2019, the programme had by 2023 reached the milestone of more than 131 000 placements.

Curriculum relevance

The old debate about how much broad education should be in a curriculum in contrast to how much skills training there should be, is a debate that won’t ever be resolved.

What can be improved is the agility of educational and training institutions. When the economy needs new skills, how fast can the country’s training providers react?

The Chemical Industries Education and Training Authority (CHIETA) is showing how it might be done. Recognising that South Africa is going to need specialists in green hydrogen, CHIETA has set out to focus on the kind of skills that this highly specialised economic sector is going to need. Few people know about electrolysers, fuel cells and the storage requirements of hydrogen. CHIETA has developed a list of 17 specific training and skill requirements as it anticipates that about 14 000 jobs might be created in this new energy sector.

The Chemical Industries Education and Training Authority, CHIETA, is establishing SMART Skills Centres around the country to boost training in digital skills. Credit: CHIETA

Another body exhibiting flexibility is the Food and Beverages SETA, FoodBev SETA. In 2023, it issued, together with the BRICS Business Council, the “Atlas of Emerging Jobs in the Food and Beverage Sector”. Taking into account global trends that include mechanisation, the atlas shows that bio-nutritionists, farm technicians and integration software engineers are going to be in demand. Many of these are jobs that did not exist 20 years ago, and some of the jobs that will exist in 20 years’ time have not even been thought of by the authors of the atlas.

Some universities are also showing an ability to adapt. Enterprises University of Pretoria is the skills division of the university and its short-course offering shows admirable variety. In listing its courses in advertising material, the unit flags the courses that are “trending”. These include project risk management, mine closure and rehabilitation, water quality management and information security management. Enterprise UP issued 11 185 certificates in 2022.

Business schools also need to examine their curriculums to ensure relevance. One way of staying relevant is to hire people who are active in business. Enterprise UP has 148 “subject matter experts” collaborating with staff members from 67 departments.

Hlengani Mathebula became a professor at the University of Limpopo’s Turfloop Graduate School of Leadership in 2023. He has been the managing executive of ABSA Private Bank and is the founder of Ignite Africa Advisory Services Group. Writing in the Sunday Times, Mathebula argued that students attending business schools should also have work experience because, without it “very little of what these schools teach will make sense, putting students at a disadvantage”.

Mathebula’s larger argument is that business schools can play a role in helping rich South Africans understand and work with poorer South Africans. He writes that a business school’s first challenge is to provide skills where both kinds of South Africans can “find common ground that will transform the dominant leadership trajectory and in that way transform the country”.

Effective waste management can reduce emissions

The National Environmental Management Laws Amendment Act, 2022 (NEMLAA 4) came into effect as of 30 June 2023 – and it’s another positive shift for our approach to environmental protection.

As per the outline from government, this Act aims to prevent pollution and ecological degradation and ensure sustainable development by providing for air quality measures, norms and standards, management and control by all spheres of government. Now that this Act has been enacted, it should not only help strengthen South Africa’s environmental enforcement but deter non-compliance with environmental laws.

While some might say that South Africa is now making good headway in our fight against climate change, we must still consider that we are in a juxtaposition between fighting climate change and fighting economic turmoil. Which one comes first, or can they coexist?

While the government has already indicated its intention to gain access to higher levels of climate financing with a goal of achieving $8-billion per year by 2030, we know that, considering the current economic environment, this may not be as easy. So, what is the immediate solution or potential opportunity?

…we have a conundrum where many people across business, communities and government are under-informed about the potential of well-managed, compliant and innovative waste-management solutions.

It’s important to note that the waste sector offers a crucial and often overlooked opportunity, not just towards reducing carbon emissions through effective waste management but in meeting the country’s Sustainable Development Goals (SDGs).

However, we have a conundrum where many people across business, communities and government are under-informed about the potential of well-managed, compliant and innovative waste-management solutions.

The reality is that with a population of 61-million people which is growing by around 1% a year, and with each person generating around 2kgs of waste per day, we are heading towards a waste disaster that will impact our climate action and our goals significantly. We need solutions.

Solving problems and creating jobs

We are already seeing some movement in the waste and energy sectors through programmes such as the Just Energy Transition (JET), which aims to explore alternative sustainable options to key challenges and where waste can, and is, forming a critical pillar.

But we need to understand that waste, if well managed, can also be a very powerful tool in job creation and social equality. In fact, the global waste-to-energy market is expected to grow from $28.4-billion in 2017 to almost $43-billion in 2024. As far back as 2019, global employment opportunities in renewable energy was given as 11.5-million people gaining access.

The International Renewable Energy Agency (IREA) has also proclaimed the opportunities that exist, stating that renewables have the potential to employ more than 40-million people by 2050.

While this new legislation is very welcome in our fight to protect our environment, the good news is that climate action and economic preservation can coexist and should be seen as complementary. In fact, waste and effective waste management presents a large economic opportunity not only to establish new industries and revenue streams but to meet legislative requirements and to achieve our climate-action agendas. It’s a win for everyone.

Biography

Kate Stubbs is the current Group Marketing Director for the Interwaste Group which forms part of Séché Environment, a leading international environmental solutions business. She has held various executive positions in marketing, sales, strategy and communications over the last 20 years, predominantly working for supply chain, logistics and waste management companies serving a broad range of industries.

Her experience has enabled her to work with diverse local and international teams and she thrives in complex, intellectually stimulating environments. Some of her successes have been in creating and building new brands, achieving growth strategies and assisting with the integration of many acquisitions.

She is passionate about developing sustainable solutions for businesses that are not only economically viable, but which are socially conscious and protect our environment for future. 

https://www.interwaste.co.za/

The 2024 edition of South African Business now available

Welcome to the 2024 edition of the South African Business journal. First published in 2011, the publication has established itself as the premier business and investment guide to South Africa.

A special feature in this journal focusses on the relationship between tertiary education, training and the jobs market. The youth unemployment rate is referenced in a discussion of the various measures that are being taken in the public and private sectors to help prepare young people for work, or to encourage them to start businesses. The role of the country’s Sector Education and Training Authorities (SETAs) is highlighted.

Regular pages cover all the main economic sectors of the South African economy. This includes tracking the rapidly evolving renewable energy landscape and reporting on the progress of exploration and discoveries of oil and gas off the coast and on land. Landmarks such as BMW’s 50-year celebration of making cars in South Africa are noted and a snapshot of each of the country’s provinces is provided.

Browse the eBook now:

A unique guide to business and investment in South Africa

South African Business is distributed internationally on outgoing and incoming trade missions, through trade and investment agencies; to foreign offices in South Africa’s main trading partners around the world; at top national and international events; through the offices of foreign representatives in South Africa; as well as nationally and regionally via chambers of commerce, tourism offices, airport lounges, provincial government departments, municipalities and companies.

South African Business is complemented by nine regional publications covering the business and investment environment in each of South Africa’s provinces and The Journal of African Business, now published quarterly. These unique titles are supported by a monthly business e-newsletter.

To advertise, please contact us.

Pioneering the future: Advanced Nuclear Technologies unveiled at the Africa Energy Indaba

Koeberg Nuclear Power Station, Cape Town, South Africa.

The upcoming Africa Energy Indaba is set to be a ground-breaking event as it shines a spotlight on cutting-edge Advanced Nuclear Technologies and their potential to shape the continent’s energy landscape.

The Nuclear Forum scheduled for 7 March 2024, will bring together global leaders, industry experts, and policymakers to delve into the latest developments in nuclear power, emphasising its potential for sustainable and reliable energy solutions.

Key Highlights

Next-Generation Reactors:

Explore the forefront of nuclear technology with discussions on the latest reactors on offer from the world’s leading nuclear vendors.  Discussions will assess the safety features, efficiency, and potential applications of these innovative reactor designs.

Small Modular Reactors (SMRs):

Delve into the world of Small Modular Reactors, examining their adaptability and suitability for diverse energy needs, especially in remote and off-grid locations.  Showcase how SMRs could play a transformative role in Africa’s energy infrastructure.

Sustainability and Economic Growth:

The Nuclear Forum will showcase nuclear energy’s contribution to sustainability goals, emphasising its role in reducing carbon emissions.  Further discussions will explore how the development of nuclear power can stimulate economic growth, create jobs, and foster technology transfer in African nations.

International Collaboration:

The Nuclear Forum will furthermore, emphasise the significance of international collaboration and partnerships in fostering knowledge exchange and supporting the implementation of nuclear energy programmes in Africa.  Opportunities for collaboration with renowned organisations and nations with advanced nuclear capabilities will be explored.

Public Awareness and Engagement:

Addressing the importance of public awareness and education, aiming to build trust and understanding of nuclear energy among communities, is a key aspect to the Nuclear Forum.

Join us at the Nuclear Forum as we usher in a new era of sustainable, safe, and reliable energy through the exploration of Advanced Nuclear Technologies. Together, we pave the way for a brighter and cleaner future for the African continent.

Find out more: https://energyindaba.co.za/

Koeberg Nuclear Power Station, Cape Town.

Final mosaic masterpiece unveiled in Bellville’s De Lange Street

Mercia Kleinsmith and Monique Muller at the unveiling of the last mosaic masterpiece in De Lange Street, Bellville.

The Greater Tygerberg Partnership (GTP) is pleased to announce the completion of the final instalment of their groundbreaking mosaic installation project in De Lange Street, Bellville. Councillor Mercia Kleinsmith recently laid the final tile, marking the conclusion of this transformative initiative.

With a total of 35 captivating mosaic tiles, including 13 unveiled in May 2023 during phase 1, and the recent addition of 22 in September 2023 for phase 2, De Lange Street is now a canvas of unity, pride, and vibrant heritage. The heart of these artworks lies in celebrating the incredible diversity that defines Bellville, drawing inspiration from the rich tapestry of nationalities that call this important economic node home.

Monique Muller, the project manager at GTP, emphasises the deeper significance of the mosaic installation, stating, “This mosaic is more than adding a splash of colour and vibrancy to our beautiful city. It is a celebration of the rich cultural fabric that makes Bellville so special. Through these intricate designs, we aim to convey the shared experiences, histories, and journeys of individuals from diverse backgrounds who have chosen to live, work and do business here.”

To enhance the visual impact of the mosaic tiles, unique designs celebrating the diversity of Bellville are featured in De Lange Street. A painted frame surrounds each tile, displaying details about the mosaic, and a painted line, the selected colour, connects these frames along the sidewalk. Additionally, large planters at existing tree bases have been painted to illustrate the national flags of different nationalities in Bellville, further contributing to the overall beautification of the walkway.

Commenting on the project, Mercia Kleinsmith, Chairperson of sub council says; “It is an honour and a privilege to have been part of the final stage of the beautification project of the sidewalk in De Lange Street. The City, together with the GTP, has been tasked by the mayor to beautify the city’s biggest central business district and it has been a welcoming site to see how the project has progressed. Thank you to the GTP for the work that has been done and may the wonderful collaboration between the City and the GTP continue to strive with abundant success”.

Safe2Park, a valued partner in this final phase, has covered half the cost of the paint, demonstrating the collaborative efforts of local businesses to transform Bellville into a cleaner, safer, and more attractive haven for residents and small businesses.

Reflecting on the completion of the second phase, Muller invites everyone to “follow the blue art line, connecting these masterpieces and foster a sense of belonging for all. Bellville’s transformation continues, one mosaic at a time.”

The GTP’s mosaic installation project stems from an extensive public participation process held in November 2022, actively engaging with a wide range of Bellville residents to determine the most impactful theme for the mosaic in various locations. The indigenous nature of flowers emerged as the top choice, representing the community’s colourful heritage, and receiving the highest number of votes.

As the mosaic installation project nears completion, the GTP remains committed to the ongoing transformation of Bellville, creating a dynamic and inclusive environment that celebrates the community’s diversity and fosters unity.

For more information on this and other Bellville art projects, visit www.gtp.org.za or email info@gtp.org.za.

Building an innovative and employable workforce in South Africa

CHIETA CEO Yershen Pillay

Where did you do your tertiary studies?

I did my undergraduate degree in Politics and Economics at the University of Cape Town. That was followed by a Postgraduate Diploma in Business Administration at the Gordon Institute of Business Science (GIBS), University of Pretoria.

I then graduated with a Master of Business Administration (MBA) qualification from GIBS in 2021. I am currently studying towards my PhD in Digital Transformation at the University of Johannesburg (UJ).

At the time, did it feel that your studies were helpful in terms of developing your broader understanding of the world and pursuing a career?

Absolutely. Studying across various institutions helped to broaden my worldview and develop a wide range of skills and interests. I gradually developed into a generalist with specialist skills in leadership and administration.

To be successful requires knowledge, skills and experience together with the right attitude and character. By continuing to learn and acquire new qualifications, I made education fashionable which assisted my career growth tremendously.

Should universities and TVET colleges be trying to strike a balance between education (in the broader sense) and training (for the workplace) or should there be a greater focus about what is offered at each type of institution?

There needs to be more of a focus on a skills-based curriculum. The result will be more employable graduates who have a penchant for solving problems and generating new ideas, innovation will flourish and the country will grow. Universities and TVET colleges are producing graduates who lack innovation skills, entrepreneurial thinking and core skills such as empathy, courage and communication.

What did you learn in the course of your diploma and Master’s at GIBS?

My MBA journey at GIBS was more about the robust classroom discussions and the discussion-based learning than the tools and case studies offered. It was a journey of self-exploration and self-awareness.

I learnt more about who I am as a human being and what I am capable of. I became more aware of my virtues, vices and “x-factor” skills.

I learnt to be a knowledge seeker. In doing so, I realised my innate skills of curiosity, strategic communication and people development, all of which have served me well in my leadership roles as the Executive Chairperson of the NYDA, MD of a logistics firm, and now CEO of an education and training authority.

How has your experience in the private sector shaped you?

My experience in corporate South Africa was enabling more than debilitating. It was a totally different role to where I am now at CHIETA. I used to be in transport as an MD and not dealing much with SETAs. However, my next role was still in transport and logistics as a board member and director of Airports Company South Africa (ACSA). The jump from transport and logistics to education and training has been a seamless one.

Many of your positions have been in positions affecting youth. Is this a passion of yours?

I have always been passionate about people and service. Working in the public sector was a perfect fit. After my days as a student leader at UCT, I took up youth development for nine years, first as the Executive Chairperson of the National Youth Development Agency and then serving as the President of the Pan African Youth Union. Making a difference through public service is what I’ve always enjoyed.

Our youth are our future. This is why I am so passionate about ensuring that youth are adequately skilled, trained and empowered for success.

I have always been an advocate of youth development. I am acutely aware of the role that youth play in society. Our youth are our future. This is why I am so passionate about ensuring that youth are adequately skilled, trained and empowered for success.

A SAFCOL board member has commented on your ICT competence: have you specialised in ICT? How important is ICT in driving progress within an organisation?

Yes, absolutely! Over time, I have acquired essential skills in ICT and cybersecurity strategy. I am currently studying towards my PhD in digital transformation with a focus on people and technologies as this is a passion of mine. We live in an era of artificial intelligence (AI) and hyper digitalisation. The impact of technology on our daily lives is inevitable.

We cannot afford to ignore the impact of technology. For this reason, I continue to play a role in the digital transformation of organisations. At ACSA, I am the Chairperson of the ICT committee where we are leading the digital transformation strategy of South Africa’s airports. At SAFCOL, we have introduced a number of automated and mechanised technologies for the digital transformation of forestry. At CHIETA, we are executing a digital transformation strategy to be a fully digitised SETA that offers digitised skills development and training services by 2025.

CHIETA’s digital transformation strategy aims to be offering digitised skills development and training services by 2025.

What do you find rewarding about serving on boards?

I have seized every opportunity as a learning opportunity to grow and develop in leadership and governance. Serving on boards in education, aviation and forestry has allowed me to develop a range of different perspectives and drive cross-sector collaboration which is a key factor of innovation.

I have had the privilege of acquiring a vast range of experience and innovation skills such as observational, discovery and networking skills. I now have an innovator’s DNA! Importantly, I have developed a relational intelligence (RQ) that has assisted me greatly in my current position as CEO of CHIETA.

How did CHIETA achieve a clean audit?

CHIETA received a clean audit outcome for the first time in five years. The key factor of success was our people. We have a great team of people at CHIETA. We are a people-centric organisation that focuses on high-impact, qualitative results.

We adopted a zero-tolerance approach to non-compliance and a “people first, everything else second” philosophy. We actively seek to empower, recognise and reward our people. In return, our people delivered the results, in this case, a first clean audit outcome after five years. This clean audit outcome signifies a SETA that works!

What are your broader goals for CHIETA?

To be a fully digitised, innovation-driven SETA that is not just about skills development, but about sustainable livelihoods and improving the quality of life. We want to support the end-to-end value chain of sustainable livelihoods. This means supporting more startups and SMMEs, so we must achieve our target of 2 000 SMMEs supported by the chemical SETA, and more than 200 co-operatives.

We have a goal of establishing nine SMART Skills Centres in every province by 2025. We are measuring grand goals such as livelihoods and the impact created through supporting more chemical startups, SMMEs, retrenched workers, gender-based violence and other social programmes, new hydrogen skills projects, VR-based training and the use of AI in education and training. We want to impact 100 000 livelihoods by 2025.

We have a goal of establishing nine SMART Skills Centres in every province by 2025.

As an innovation leader in education, skills development and training we don’t want to train for the sake of training and contribute to employment. Our broader goal is to improve the quality of life by focusing on sustainable livelihoods. 

The Chemical Industries Education & Training Authority (CHIETA)

The Chemical Industries Education & Training Authority (CHIETA) is a statutory body that was established by The Skills Development Act 97 of 1998. Our purpose as a SETA is to facilitate skills development in the chemical industries sector and to ensure that skills needs are identified and addressed through a number of initiatives by the SETA and the sector.

Find out more: https://www.chieta.org.za/

Cape Winelands welcomes airport expansion

The picturesque Cape Winelands region is set to soar to new heights with an estimated R7-billion airport expansion programme, marking a significant milestone in the area’s development and accessibility.

Cape Winelands Airport, established in 1943, is an integral part of the Northern District of Durbanville. As one of the oldest airfields in the region, it has primarily served the General Aviation community. The airport’s strategic location makes it a vital asset for the region, poised to contribute significantly to the local economy and the aviation industry.

The belief is that the holiday starts when arriving at the airport and not at your destination. The development plans include vineyards as part of the landscaping aesthetics to portray the regions wine culture, ensuring that when one arrives at the terminal precinct of Cape Winelands Airport, one will be surrounded by vineyards with open spaces that includes a plaza, a hotel, conference centre, a wine tasting experience, an outdoor amphitheater for events up to 5000 people, an aviation museum and plenty of at-grade parking, all situated in a “park” like environment. In the controlled airside area of the airport, a portion of the land will include a botanical garden with a diverse collection of indigenous fynbos, both within the country and globally.

“We are thrilled to introduce this our airport expansion to the Cape Winelands region”, said Deon Cloete, Managing Director of Cape Winelands Airport. “This facility represents a commitment to providing world-class transportation options, promoting tourism, and stimulating economic growth in our beautiful region.”

The airport will offer a range of contemporary amenities and services designed to enhance the travel experience. These include efficient check-in counters with advanced technology for swift processing, spacious and comfortable waiting lounges with ergonomic seating, and a diverse selection of high-quality dining establishments and boutique shopping outlets, ensuring that passengers have access to a wide array of food and retail options to suit their preferences and needs.

Cape Winelands Airport will serve as a crucial gateway to the Cape Winelands region, offering a range of domestic and international flight options and opening up new routes. The airport will effectively process 2,000,000 international tourists and 3,000,000 domestic travelers per annum by 2050, taking the overall annual passenger traffic to the region from 10 million to 20 million passengers. Beyond job creation, the airport is expected to have a far-reaching impact on the regional economy. Increased tourism and business opportunities will contribute to the growth of local businesses and industries, especially around the logistics clusters.

“Airports world-wide are known to have a positive impact on the socio-economic conditions of the regions which they serve. This airport will be no different,” said Deon Cloete, Managing Director of Cape Winelands Airport.

The airport aims to be self-sufficient and off the grid for water and electricity as far as possible. Through a commitment to sustainability and innovation, it will harness renewable energy sources, such as solar and chicken manure biogas power, to power its facilities and operations. This shift towards self-sufficiency will not only reduce the carbon footprint but will also ensure a reliable and uninterrupted energy supply, even in adverse conditions. The airport will implement state-of-the-art water recycling systems, able to conserve and purify water for various airport needs. Additionally, its waste management practices will prioritise recycling and composting, further reducing its environmental impact.

Over the past three years, the team has diligently engaged in meticulous planning and extensive consultation with stakeholders from the broader aviation industry. This collaborative effort underscores the commitment to delivering world-class services and facilities to passengers, airlines, and partners. By meticulously crafting a strategic vision through years of dedicated work, Cape Winelands Airport aims to enhance the travel experience, boost operational efficiency, and remain at the forefront of innovation in the aviation sector.

“The airport leaves the city, the city follows the airport, and the airport becomes the city.” – John D Kasarda, The Airport City Phenomenon

Facts and Figures

  • Main Runway – 3500m can accommodate (Boeing A380).
  • Code 4F Runway with a category 9 fire cover and a category 3 ILS.
  • Secondary Runway – 700m, Code 1A, primarily focused on small planes in cross wind conditions.
  • Estimated to have 25% of the passenger market into Cape Town by 2050 and grow to 5m passengers.
  • Anticipated to introduce the first digital tower and control room in Africa.
  • Buildings to include hangarage for aircraft storage, facilities for light manufacturing and industrial purposes, logistics and warehousing services, food processing facilities, spaces for educational and commercial office purposes, retail spaces, venues for events and conferences, hotel, a bulk aviation fuel farm, and a public filling station.

What is a closer alternate airport and what does it mean for Cape Town:

By law, every airline must register an ‘alternate destination airport’ at which it will land in the event that it is unable to land at its intended destination airport due to an emergency, poor weather conditions or the like.

In Cape Town, an international airline will generally identify one of the main airports in Johannesburg as its ‘alternate destination airport’. This means that with every flight, it must carry sufficient fuel to fly to the ‘alternate destination airport’ in the event that it might need too. With the existence of CWA, a much closer ‘alternate destination airport’ exists. Alternate airports are part of the flight planning process and are specified in the flight plan, allowing the crew to make informed decisions in the event of diversions or emergencies.

The result of CWA as an alternate destination is:

  • Improved redundancy and less dependence on one airport
  • Reduction in fuel uplift – 110,000,000 kg enabling additional cargo opportunities
  • Annual reduction in fuel consumption (5% per flight) – 21,000,000 liters of fuel saved.
  • Annual reduction in CO2 emissions – 54,000,000 kg less CO2 into the environment.
  • Improved flight times for all tourists and residents in an emergency.
  • Reduced costs and enhanced viability will lead to reduced airfares and cargo rates.

Additional Cargo Capacity

It is estimated, using Customs and Excise reported facts, on kilograms imported directly into Cape Town by air that through having a closer destination alternate airport in Cape Town this will increase the additional cargo capacity into the area significantly. Additional supply will have consequential reductions in air cargo prices.

Estimated Initial Capital investment

  • R7-billion
For more information about the airport please visit our website at capewinelands.aero.

Unpacking government’s proposal of a two-pot retirement saving system

The Covid-19 pandemic and resulting lockdowns saw many South Africans accessing their retirement savings as a cash withdrawal on leaving their employer due to resignation, dismissal or retrenchment, rather than preserving their accumulated retirement savings (keeping one’s retirement savings invested) as a result of the financial strain on their household finances.

In South Africa, the savings rate remains low. Our total household savings averages just above 2% of GDP per annum, with the majority of this being allocated to contractual retirement fund savings.¹ Furthermore, 34% of the Old Mutual Savings and Investment Monitor 2021 survey respondents indicated that they do not have enough savings to last more than one month if they lose their income.² But even contributions to retirement funding are low and in the majority of cases this is the only source of saving.

This low level of savings is exacerbated by low levels of preservation when moving jobs before retirement. Data from the South African Revenue Service (SARS) indicates that over 700 000 individuals cashed out a “withdrawal lump sum” before retirement for each of the last three years, resulting in an annual average of R78-billion being taken out of the retirement system through withdrawals made before retirement.

Low savings coupled with low levels of preservation results in a significant portion of the South African population not being able to retire with adequate retirement funding. This is worsened in times of financial hardship, as seen with the Covid-19 pandemic, where individuals with little to no sources of other savings turn to their retirement savings as a source of emergency funding when moving between jobs.

There may be a need for a formal regulated system of pre-retirement withdrawals that is different to what currently exists – one that enables individuals to access a portion of their retirement savings before retirement if needed, but also ensures some prescribed level of preservation, affording one the ability to still retire comfortably without unduly eroding accumulated retirement savings before retirement.

Addressing the conflicting priorities of saving for an income in retirement (and enforcing preservation) but allowing (some) access to retirement savings during financial hardship in working ages has historically been extremely topical and even more so considering the impacts of the Covid-19 pandemic. National Treasury released a paper in December 2021 proposing a two-pot system for retirement savings, followed by discussions and debates which are currently ongoing between the National Economic Development and Labour Council (NEDLAC), key stakeholders, trade unions and regulators.

The proposed Retirement Reform would result in the restructuring of future retirement savings contributions – allowing for limited pre-retirement withdrawals from one’s retirement fund to help alleviate financial pressures, while addressing compulsory preservation.

National Treasury released a paper in December 2021 proposing a two-pot system for retirement savings, followed by discussions and debates which are currently ongoing between the National Economic Development and Labour Council (NEDLAC), key stakeholders, trade unions and regulators.

Overview of the proposed two-pot system

In short, National Treasury’s proposal involves a two-pot system. The first pot, known as the “Retirement Pot”, is made up of two-thirds of all future retirement fund contributions (ie contributions made after the implementation date of the two-pot system) plus investment returns earned on these contributions. This pot must be preserved (remain invested) until retirement and cannot be accessed before retirement.

The second pot, known as the “Access Pot”, would enable access to accumulated retirement savings prior to retirement and make up of the remaining one-third of all future retirement fund contributions plus investment returns earned on these contributions. It is recommended that withdrawals from the Access Pot should be permitted (provisionally) once per year only, subject to a minimum amount of R2 000. If members access only a portion of their retirement savings in the Access Pot, the remaining amount from the previous year plus further accumulated amounts become accessible again in the following year and so on.

The cost of the withdrawal(s) will be covered by the member withdrawing. The amount withdrawn from the Access Pot will also be subject to tax at the relevant withdrawal tax rates.

Members will be required to undergo benefit counselling and/or obtain financial advice before a withdrawal is made. This aims to help ensure that individuals accessing their retirement savings early understand the long-term consequences these withdrawals may have on their future retirement goals.

Some considerations regarding the proposal

The proposal is highly complex and requires numerous changes to processes, reporting, systems, communication, legislation and training to members, employers, trustees and intermediaries.

Some of the issues still under consideration include:

  • It is recommended that withdrawals from the Access Pot should be permitted (provisionally) once per year only. The definition of a “year” (ie if a tax year or a rolling 12-month period from the commencement date of a member’s contributions) requires clarification to ensure consistent treatment for all funds and ease of administration.
  • Whether members should be able to immediately access 10% of their share of retirement fund savings, up to R25 000, at implementation of the legislation.

The retirement industry has indicated several concerns on the large sudden outflows from retirement funds should a large number of individuals decide to make use of the immediate access to their retirement savings all at once upon implementation date. The result may place significant pressure on capital markets, administrators, funds and SARS with respect to the payment of these withdrawal benefits.

The retirement industry has indicated several concerns on the large sudden outflows from retirement funds should a large number of individuals decide to make use of the immediate access to their retirement savings all at once upon implementation date.

Liberty Group’s view on the proposal

As Liberty, we are in support of the proposal by National Treasury in the view that if correctly structured and implemented, it may help improve retirement funding in the longer term and retirement outcomes for South Africans. However, it is both complex and a material change to the current retirement system, we therefore caution that the proposed timeline may extend beyond the targeted implementation date.

A balance needs to be achieved between ensuring that the size of the Retirement Pot is large enough to provide for a comfortable retirement and the achievement of long-term retirement goals and ensuring that the Access Pot is sufficiently sized to adequately allow for continued access prior to retirement.

We believe that the proposed two-pot system could achieve a constructive outcome by supporting those in our society who are suffering financial hardships, while simultaneously boosting long-term financial savings to benefit many.

¹ National Treasury, Encouraging South African households to save more for retirement. Reference to SARS data. 2021121401 Two-pot system retirement proposal and auto enrolment.pdf (treasury.gov.za)
² Old Mutual Savings and Investment Monitor 2021 survey.

Changing the sustainability course for the agri-processing sector

The agri-processing sector is among South Africa’s high-impact sectors with its value chains contributing 20.3% to the manufacturing gross domestic product (GDP) and 2.7% to the total GDP. While the sector has great growth potential and is a positive contributor to the economy, it is water and energy intensive. This impacts on its sustainability and global competitiveness.

The International Finance Corporation (IFC) and the National Cleaner Production Centre South Africa (NCPC-SA) have undertaken research which resulted in the “South African Dairy Processing Resource Efficiency Benchmarking Study”.

The study sought to assess the gaps in the dairy-processing industry with a focus on the cheese and yoghurt industries, while identifying practical energy and water measures that can be adopted to improve resource consumption and management.

The dairy-processing sub-sector was selected as a sample for the study for two reasons. Firstly, the NCPC-SA previously conducted assessments and gathered energy and water consumption data from participating dairy companies. Secondly, the study cements the collaborative work between the two organisations in improving efficiencies in the agri-processing sector including the development of the “Metering and Monitoring Guideline” aimed at transitioning the sector to better water and resource-efficiency practices.

The benchmark study specifically highlights the following potential savings for the dairy sector based on the results of onsite assessments conducted in line with international best practices:

  • A 70% reduction in potable water consumption, reducing overall water utilisation by approximately one litre or approximately six-million kilolitres per annum nationally, translating into monetary savings of R138-million to R200-million per annum.
  • A 25-50% reduction in electricity consumption and associated greenhouse gas (GHG) emissions translating into 200 000 to 400 000 megawatt per hour (MWh) per annum and a cost saving of R250-million to R500-million per annum.
  • A 30% reduction in fuel consumption and 50% reduction in GHG emissions for fossil fuels (assuming 50% uptake in fuel switching) which could potentially result in R180-million savings per annum.

Reducing carbon emissions

NCPC-SA Senior Project Manager Lindani Ncwane says, “We identified many resource-efficient and cleaner production opportunities that dairy companies can implement with little or no capital investment.

“It is remarkably easy for companies with smaller operations to improve their processes and start saving,” he adds.

The implementation of resource-efficient and cleaner production (RECP) interventions not only improves the efficient use of resources, reduces waste and saves costs. RECP also plays a major role in the industry’s ability to reduce carbon emissions and environmental impact. A strong business case for industry to operate sustainably is evident. There is increasing pressure for local and global markets to source and supply sustainably produced goods to mitigate the impact of carbon emissions.

For instance, in South Africa, the KwaZulu-Natal province was struck by a natural disaster that can be directly linked to climate change: it impacted the province’s key economic drivers such as the damage that was incurred at the Toyota motor plant. There is also an increase in the global export markets’ demand for sustainably produced goods.

The South African Dairy Processing Resource Efficiency Benchmarking Study was conducted through the IFC’s Agri-Processing Resource Efficiency (APRE) programme, launched in 2019 to improve energy and water efficiency in the agri-business sector in South Africa, with support from the Swiss State Secretariat for Economic Affairs (SECO). The outcomes of the study, along with participant input from the workshop where the results were presented, will be used to produce another practical guide for the sector. It also promises to revolutionise the sustainability journey for companies who follow its recommendations.

Contact

For more information about the Agri-Processing Resource Efficiency interventions or to gain insight on how your company can benefit from the interventions at no cost, contact the NCPC-SA at ncpc@csir.co.za or visit https://www.industrialefficiency.co.za/

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