The electrical contracting industry (ECI) experienced a significant decline in the amount of available work last year, resulting in many employees being retrenched, reports industry body Electrical Contractors’ Association (South Africa) (ECA(SA) national director of operations Chris Greager.
“It appears that the global recession only reached South Africa last year, with most sectors of the economy having felt the pinch. The loss of highly experienced employees, owing to retrenchments, is a tragedy because they are lost not only to their employers, but also to the industry as a whole.
“Meanwhile, economists have reported that the South African economy is only expected to turn around in 2011/12, and consulting engineers have also experienced a significant decrease in available work. As a result, there are few major projects currently taking place,” explains Greager.
He believes that the lack of work is unusual, as the interest rates have decreased and the rand is strong. However, the effects of the recession have left businesses and individuals wary of spending money on improving, maintaining or upgrading their capital investments.
Further, Greager points out that the availability of qualified electricians in the industry is still a concern, with the average age of qualified electricians being about 55. He encourages employers to take on apprentices, despite the downturn in the economy, to ensure that there are individuals to continue driving the industry.
“The majority of the employers in the industry are microemployers with ten or fewer employees. As a result, they do not contribute to the Skills Development Fund in terms of the Skills Development Act of 1998. “Therefore, microemployers are only entitled to discretionary grants. The Sector Education and Training Authorities (Setas) need to be encouraged to be more generous with their grants,” says Greager.
Meanwhile, the dysfunctional Energy Seta (ESeta), which is responsible for the ECI, was placed under administration by the outgoing Higher Education and Training director-general Mary Metcalfe in September last year.
“The board and the constitution were suspended and an administrator was appointed for an initial period of six months. Prior to its being placed under administration, CEO Funamna Mankaye was also dismissed,” says Greager.
He believes that ESeta has been a disaster for the industry since its inception and has created a situation where limited training has taken place.
As a result, the ECA(SA) decided to return to the apprenticeship system, which the association says is far less complicated than ESeta’s learnership programme and which is producing the qualified electricians desperately needed in the industry.
“On November 9, 2010, Minister of Higher Education and Training Dr Blade Nzimande announced that the ECI would be transferred to the Construction Education and Training Authority (Ceta). This forms part of the Department of Higher Education and Training’s restructuring of the entire Seta system. “The transfer should take place in April, but it also raises some concerns as Ceta also does not have a good reputation for delivering training.
“Ceta has indicated [it is] interested in the ECA(SA) coming aboard and, hopefully, the authority will allow the ECA to form its own chamber in the authority to look after the interests of the ECI,” adds Greager.
Meanwhile, he says that the wage negotiations for 2011 and 2012 with the South African Equity Workers Association, the trade union party to the Bargaining Council, were conducted in a good spirit and were significantly different from the negotiations in 2008, where it took 11 meetings and a strike to bring the interested parties to an agreement.
“Unfortunately, the wage increases for 2011 are above the rate of inflation, and many employers feel that the increases are too high in view of the poor recovery of the local economy. However, the negotiations took place when many other organisations and bodies were offering generous increases to settle or avoid labour unrest.
“In this climate, it is very difficult to negotiate lower rates because an expectation has been created in the minds of all the employees working in all sectors of the economy. However, many employers are going to be forced to reduce their labour force to meet the new wage bill, particularly at a time when work is so scarce in South Africa,” explains Greager.
Electrical Installation Regulations and the ECB
Though electrical contractors seem to have aligned with the requirements of the new electrical installation regulations, certificates of compliance and test reports, Greager says, there are a number of issues in the regulations which still require some clarity.
“The Department of Labour (DoL) chief inspector for the ECI has indicated that guidelines and criteria to tackle these issues will be released shortly. One of the significant issues faced by the industry is the Approved Inspection Authorities (AIAs), of which there are currently only two in the country,” he notes.
The AIA was implemented by the DoL under a pilot scheme to assist in policing electrical installations. However, the registrations of those AIAs, which fell under the pilot scheme, have been withdrawn and proper accreditation through the South African National Accreditation System is now required.
“Although the ECA supports such an inspectorate, it wants to ensure that the AIAs operate within the requirements of the regulations, and that their powers and functions are clearly defined,” says Greager.
Meanwhile, the Electrical Contracting Board (ECB), which is now independently operated because of a previous misconception that it was a part of the ECA(SA), has been appointed by the chief inspector to continue the registration of electrical contractors until February 28, or until such appointment is withdrawn.
The ECA(SA) has again been appointed by the ECB as a service provider to continue carrying out registrations at its offices and providing certificates of compliance and test reports. This still seems to be the preferred arrangement with most electrical contractors, concludes Greager.