The Mining Charter, B-BBEE, a revised Housing Standard and Trusts

Relevant Legislation: 

The Mining Charter of 2018

Mining Charter Implementation Guidelines

Mineral and Petroleum Resources Development Act (28/2002): Housing and Living Conditions Standard for the Minerals Industry 2019 – Gazette #42899 dated 11 December 2019 (Marc, this has not been uploaded to the website as it does not have any direct commentary related to the B-BEE Act but by extension requires compliance from a supplier perspective)

On 11 December 2019 the Department of Mineral Resources and Energy released the reviewed Housing and Living Conditions Standard for the minerals industry.

The reviewed Housing and Living Conditions Standard repeals the 2009 Housing and Living Conditions Standard. The reviewed Housing and Living Conditions Standard retains many of the principles contained in the 2009 standard while introducing new requirements for both existing and new mining right holders.

The query you may have is what does this have to do with B-BBEE? The answer is quite straightforward.

Mining right holders must ensure that the procurement for housing development is conducted in line with the requirements of the Mining Charter as it provides clear-cut requirements on mining suppliers. The suppliers must be a BEE compliant company having at least a level 4 status in terms of the DTI’s BEE Codes of Good Practice, and at least 25% +1 vote ownership by historically disadvantaged persons. Previous articles were written in 2019 explaining the Mining Charter in basic detail.

Mining right holders will remain under pressure to achieve both the procurement targets and meet the requirements of the Housing and Living Conditions Standard 2019.

If one were to consider the opening statements of the Housing Standard it goes without saying that the requirements are obvious to all but often overlooked as not too important.

“Mission – To provide for progressive realisation and protection of mine employees basic constitutional right to human dignity through provision of adequate access to housing, better living conditions and related amenities of life.”

“Purpose of the document – To ensure that mining right holders provide decent liveable integrated human settlements, healthcare schemes, balanced nutrition, water and related amenities to mine employees.”

To achieve this it is required that the mineral rights holder, employees, communities and suppliers all act in the best interests of each other and ensure that the requirements of basic human rights and the principles of the Mining Charter and B-BBEE Act are adequately complied with on an ongoing basis. Without transparency and consultation this basic housing standard will probably not be complied with.

Who are the stakeholders?

The Mine community is seen as the benefactors and of utmost importance where mining takes place including major labour sending areas, adjacent communities within a local municipality, metropolitan municipality or district municipality.

A mining right holder must meaningfully contribute towards Mine Community Development, in keeping with the principles of the social license to operate.

A Trust or similar vehicle to oversee implementation of the 5% equity equivalent should have – at minimum – representation from host communities (including Community Based Organisations and Traditional Authorities where applicable) and mining companies.

The Trust must identify community development needs and develop a host community development programme (to be published in at least 2 local languages), fund distribution, governance and organisation.

Administration costs, project management and consultation fees of the Trust may not exceed 8% of the total budget.

Community development programme approved under this element shall not substitute Social and Labour Plan (SLP) commitments.

Mining right holders operating in the same area may collaborate on identified projects to maximise the socio-economic developmental impact, in line with their approved SLPs. Approved SLPs must be published in English and a dominant language(s) commonly used within the mine community.

In closing, the principles as set out in the Housing and Living Conditions Standards for the Mining and Minerals Industry developed in terms of section 100 of the MPRDA include:

Decent and affordable housing;

Provision for home ownership;

Provision for social, physical and economically integrated human settlements; and

Secure tenure for mine employees in housing institutions

Proper healthcare services

Balanced nutrition

Mining Rights Holders must ensure that minimum requirements of the Mining Charter, B-BBEE Act and the Housing Standard are complied with at all times or they could place their ability to continue mining at risk to the detriment of thousands of citizens both directly and indirectly dependant on the mining company.

Author Craig Tonkin

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