CHAPTER 11fred.csir.co.za/project/CIP_EIA/pages/ESS_ch11.pdf · IMPACT ASSESSMENT ON THE...

CHAPTER 11:

IMPACT ON THE SOCIO-ECONOMIC

ENVIRONMENT

IMPACT ASSESSMENT ON THE SOCIO-ECONOMIC ENVIRONMENT

CHAPTER 11

CONTENTS 11. IMPACT ASSESSMENT ON THE SOCIO-ECONOMIC

ENVIRONMENT_____________________________________ 11-1 11.1 Approach to the Socio-economic study ______________________11-1

11.1.1 Terms of Reference ___________________________________________11-1 11.1.2 Information sources ___________________________________________11-1 11.1.3 Specific assumptions and limitations ______________________________11-2

11.2 Description of key socio-economic elements of the project______11-2 11.3 Description of the local socio-economic environment __________11-3

11.3.1 Existing development initiatives __________________________________11-3 11.4 Identification of applicable policies, legislation, guidelines or standards______________________________________________________11-5

11.4.1 Implications for the Coega Integrated Power Project __________________11-6 11.5 Description of socio-economic issues _______________________11-7 11.6 Scenarios to be considered in the Socio-economic study ______11-11 11.7 Project alternatives ______________________________________11-11 11.8 Impact assessment ______________________________________11-11

11.8.1 Construction phase___________________________________________11-11 11.8.2 Operations phase ____________________________________________11-12 11.8.3 Decommissioning phase_______________________________________11-13

11.9 Specification of environmental thresholds___________________11-17 11.10 Recommendations for project planning and design ___________11-17 11.11 Recommendations for baseline monitoring __________________11-17

TABLES Table 11.1: Direct employment opportunities created for local and foreign employees during

the construction and operations phase of the CIPP .......................................11-2 Table 11.2: Construction phase socio-economic issues .....................................................11-8 Table 11.3: Operations phase socio-economic issues........................................................11-9 Table 11.4: Decommissioning phase socio-economic issues ...........................................11-10 Table 11.5: Construction phase socio-economic impacts .................................................11-14 Table 11.6: Operations phase socio-economic impacts....................................................11-15 Table 11.7: Decommissioning phase socio-economic impacts.........................................11-16

Coega Integrated Power Project: Environmental Screening Study Final Report, February 2004 - Confidential

page i


CHAPTER 11

11. IMPACT ASSESSMENT ON THE SOCIO-ECONOMIC ENVIRONMENT

11.1 Approach to the Socio-economic study This chapter covers the socio-economic impacts associated directly and indirectly with the Coega Integrated Power Project (CIPP). It is based on a synthesis of information from the Aluminium Pechiney EIA specialist study on socio-economic impacts (van der Walt, et al,, 2002). 11.1.1 Terms of Reference The assessment of impacts associated with the project included the following:

Identification of the key socio-economic components of the CIPP

Overview of the socio-economic characteristics of the environment in which the CIPP would be constructed and operated

Identification of policies, legislation, guidelines or standards that are applicable to the management of socio-economic aspects of the project

Description of socio-economic issues associated with the project

Identification of alternatives considered by the project proponents (where relevant)

Assessment of socio-economic impacts associated with the project

Recommendations for project planning and design, baseline monitoring and further studies.

11.1.2 Information sources Information on employment numbers for construction and operations was obtained from the “Economic Impact Assessment of the proposed Coega Integrated Project: Macro-economic and regional impact assessment of scenario S3a(2)” completed by Global Insight Southern Africa (Pty) Ltd in October 2003 (Global Insight, 2003). Information on the socio-economic environment and issues related to the development of projects within the Coega IDZ were sourced from the socio-economic specialist study undertaken by ACER (Africa) for the Environmental Impact Assessment (EIA) for the Aluminium Pechiney smelter in 2002 (van der Walt et al., 2002; CSIR, 2002).

Coega Integrated Power Project: Environmental Screening Study

Final Report, February 2004 - Confidential

page 11-1


CHAPTER 11

11.1.3 Specific assumptions and limitations For the purposes of this Environmental Screening Study it was assumed that the local socio-economic impacts would be similar to those predicted for the construction and operation of an aluminium smelter within the Coega IDZ. Based on previous communications with NPA it is assumed that the CDC’s policies and systems for recruitment, employment, skills development and housing of construction workers will continue to apply to NPA and tenants within the Port of Ngqura. It is assumed that the employment figures provided within the Global Insight report define “local” as being South African employees. For the purposes of recruitment, the CDC defines “local” as the NMMM for unskilled and semi-skilled jobs, and the rest of the Eastern Cape for higher skills. To accurately evaluate projects based on their comparative “local content” it is important that a single definition of “local” is applied. It is suggested that for further socio-economic and macro-economic studies undertaken for this project, that employment figures are reported in terms of the CDC’s definition as well as their skills categories. Employment figures reported in the Global Insight report are assumed to be maximums, i.e. peak employment during construction. 11.2 Description of key socio-economic elements of the project The direct employment opportunities created by the project are summarized in Table 11.1.

Table 11.1: Direct employment opportunities created for local and foreign employees during the construction and operations phase of the CIPP

Number of South Africans employed

Number of foreigners employed

Total number of jobs created

Construction phase 2556 77 2633

Operations phase 129 3 132 During construction, workers originating from outside of the NMMM will be accommodated in the construction villages which have been established by the CDC and NPA. It is expected that the project will provide a number of opportunities for sub-contracting services to small, medium and micro-enterprises (SMMEs) and to black economic empowerment (BEE) entities.



page 11-2


CHAPTER 11

11.3 Description of the local socio-economic environment As described in the Global Insight Southern Africa report, the Nelson Mandela Metropolitan Municipality (NMMM) had a population of approximately 1 million inhabitants in 2002. A significant percentage of this population is living in poverty (39%) and unemployment levels in the NMMM are high. Despite these realities, even higher levels of poverty and unemployment in the wider Eastern Cape province is contributing to the in-migration of job-seekers to the NMMM, and in particular, to areas in close proximity to the IDZ. An initial assessment for the proposed Port of Ngqura suggested that the population of Motherwell may be growing at a rate of 4.5% a year (CES, 2001). This trend may be expected to increase as the development of the port and the Coega IDZ progresses. The influx of people from surrounding areas is exacerbating the shortage of housing and other services such as schools and hospitals within the NMMM. Interviews conducted by the socio-economic specialist for the EIA of the proposed Aluminium Pechiney smelter in 2002 established that housing schemes are, however, being developed to the north of Motherwell to provide for people residing in informal settlements around areas such as KwaZakhele and Zwide. The NMMM plans to construct approximately 25 000 houses in the area within the next five years (Mentz, M and Africa, D. City Engineer’s Administrative Unit, NMMM, 2002. pers comm., 29 May 2002. In order to reverse the above trends and stimulate and support socio-economic development, a number of initiatives are currently underway in the NMMM and surrounding areas. Key amongst these are the establishment of the Coega IDZ and the development of the Port of Ngqura, support services for the development of small-, medium- and micro-enterprises (SMMEs) and corporate social investment programmes. In addition, the expansion of the Addo Elephant National Park and the growth of the ecotourism sector in the Eastern Cape is being promoted for its conservation value as well as for the contribution that tourism and conservation initiatives can make to employment creation. These initiatives are described in Section 11.3.1 below. 11.3.1 Existing development initiatives Coega Industrial Development Zone and Port of Ngqura In order to redress the inequities of the apartheid-era economic system and stimulate economic growth and development, South Africa’s macroeconomic policy is currently based on the Growth, Employment and Redistribution (GEAR) strategy. Within this strategy a strong emphasis is placed on sectoral and regional industrial and infrastructure development through spatial development initiatives (SDIs) and industrial development zones (IDZs). The NMMM is included in the Fish River SDI, which is one of three SDIs in the Eastern Cape.



page 11-3


CHAPTER 11

The vision behind the SDIs is the unlocking of economic potential in specific underdeveloped areas of South Africa. The Coega IDZ is the first IDZ to be established in South Africa, and forms part of the South African government’s vision for the country to become one of the world’s key manufacturing centres. Through the provision of serviced land and world-class infrastructure, the Coega Development Corporation (the operators of the Coega IDZ) aims to attract investors to the IDZ. The current large-scale construction of infrastructure associated with the development of the IDZ and the Port of Ngqura is, amongst others, providing short-term employment opportunities for unskilled and semi-skilled workers, as well as for SMMEs and black economic empowerment (BEE) initiatives. SMME development Currently there is a strong focus on empowerment and the development of small, medium and micro enterprises (SMMEs) within the NMMM. The Port Elizabeth Chamber of Commerce and Industry (PERCCI) and other business chambers play a significant role in such enterprises. A number of organisations and institutions are currently in existence, some of which are purely tasked with SMME development and empowerment. These include the Port Elizabeth Regional Manufacturing Advisory Centre (PERMAC), the Commercial Self Employment Centre (COMSEC) and the Black Economic Empowerment Forum (BEEF). Corporate Social Investment Programmes The commercial sector of the NMMM, ranging from small businesses to large multi-nationals, has become increasingly involved with projects in surrounding communities. Over the past few years the local community has benefited tremendously from these Corporate Social Investment (CSI) projects, which include: housing, land and education and skill development initiatives; entrepreneurship programmes and business mentorships; and programmes that support the provision and maintenance of infrastructure such as children’s homes. Tourism A number of tourism related developments are currently underway within the NMMM, or in the close proximity to the Coega IDZ. South African National Parks (SANParks) is currently in the process of substantially expanding the Addo Elephant National Park from the existing approximately 125 000 ha to around 372 000 ha (there is further potential to expand it ultimately to around 400 000 ha). The Park draws approximately 115 000 tourists annually, of which an estimated 50% are foreign. Part of the expansion project is to relocate the main entrance gate from near the town of Addo, to Colchester thereby easing tourist access from the N2 national road.



page 11-4


CHAPTER 11

11.4 Identification of applicable policies, legislation, guidelines or standards This section focuses on the policies, agreements and mechanisms which the CDC has established to guide tenants in the implementation of employment and equity principles such as maximizing the use of local labour, provision of equitable employment opportunities, supporting SMME and BEE development and skills training. The CDC has established a Labour and Business Management Service (LBMS) as part of their ”one-stop-shop” service provided to potential IDZ and Port of Ngqura tenants. This is based upon the:

IDZ Industrial Relations Policy;

IDZ Labour Agreement; and

Project Labour Agreements.

Industrial relations policy and guidelines are being developed by the CDC in consultation with stakeholders for the IDZ. The objective is to provide guidance for all prospective tenants within the IDZ, in order to promote a common understanding of industrial relations, eliminate duplication, and ensure consistency in the application of labour management issues. The guidelines will provide principles to guide labour matters on all contracts with prospective tenants, including recruitment target areas and priorities. The IDZ Industrial Relations Policy is contractually binding upon all contractors and served as a basis for the development of the Zone Labour Agreement (ZLA) and subsequent Project Labour Agreements (PLA). The Zone Labour Agreement has been completed and signed by the relevant parties (including the CDC, NPA and Labour). The Zone Labour Agreement includes:

Zone wide employment standards governing employment conditions and benefits.

Fixed job titles and job descriptions per industry.

Standardised job categories based on unit standards and outcomes.

Standardised Contracts of Employment.

A no-poaching clause.

A standard disciplinary and grievance procedure.

The Project Labour Agreement may be developed and negotiated between the appointed construction manager and the respective industry employer associations and trade unions, to deal with specific issues that are not covered in the ZLA. The PLA then becomes an addendum to the ZLA and will be contractually binding on all contractors working on a specific project.



page 11-5


CHAPTER 11

The objective of the LBMS is to ensure the optimum use of available local resources (which includes labour, goods and services) and to facilitate buy-in and support from local stakeholders. The emphasis is, therefore, strongly on the use of local labour and on providing a fair and equitable opportunity for all individuals currently employed in the region (NMMM) to be involved in the development of the Coega IDZ through training, assessment and employment by contractors. For the purposes of recruitment, the CDC defines “local” as the NMMM for unskilled and semi skilled jobs, and the rest of Eastern Cape for higher skills. Based on communications with the CDC during the Aluminium Pechiney EIA, recruitment from further afield will only be considered if skills are not available locally and/or training programmes are unable to provide the necessary skills timeously, (Fourie, J. CDC, 2002. pers comm.., 18 June 2002). The specific percentage targets for gender, age and disability will be set through a Labour Consultative Forum. The Labour and Business Management Services have two components:

Labour Management Services

This includes labour supply and labour demand management, training management and industrial relations management. The CDC has invited potential job-seekers to register their interest in employment opportunities within the IDZ.

Business Management Services

This includes procurement management and Small, Medium and Micro Enterprise (SMME) development management. Procurement management aims to facilitate, optimise and manage the participation of local enterprises in goods, services and works contracts. SMME development management aims to create an enabling environment, that will facilitate optimum and equal access to business opportunities for SMMEs, and supporting such access with training and development programmes.

11.4.1 Implications for the Coega Integrated Power Project The CIPP will be required to make use of the Labour Management Service for recruitment purposes. No recruitment will be allowed on-site or near site, only at recruitment centres set up by the CDC. Of the nine skill levels identified, use of local labour for the first two levels is compulsory. The IDZ Industrial Relations policy is contractually binding and is the basis for the ZLA. All developers will have to adhere to the Industrial Relations policy and ZLA and implement it in their own industrial relations and human resources activities.



page 11-6


CHAPTER 11

It is not compulsory for contractors to make use of the Business Management Service for procurement and SMME involvement. However, it will be to any developer’s benefit at least, to investigate the merits of the system based on individual requirements. 11.5 Description of socio-economic issues The proposed CIPP would result in both positive and negative impacts over the lifespan of the project. Positive impacts during both construction and operation include employment creation, increasing opportunities for the employment of local labour, economic development, opportunities for SMMEs and BEE groups, training and skill development opportunities, development through a Corporate Social Investment programme, increased investor confidence and greater stability in the power supply to the Eastern Cape. Negative impacts include potential for transport operator conflicts, induced migration, increased pressure on infrastructure and services, potential health impacts, and the potential increase in the spread of HIV/AIDS. The key socio-economic issue associated with decommissioning is the retrenchment of employees. These issues are summarized in Tables 11.2 to 11.4.



page 11-7

IMP

AC

T A

SSE

SSM

EN

T O

N T

HE

SO

CIO

-EC

ON

OM

IC E

NV

IRO

NM

EN

T

CH

AP

TE

R 1

1 Ta

ble

11.2

: Con

stru

ctio

n ph

ase

soci

o-ec

onom

ic is

sues

Issu

e/co

ncer

n id

entif

ied

Pote

ntia

l sou

rce

of im

pact

Po

tent

ial i

mpa

ct

Situ

atio

n un

der w

hich

neg

ativ

e im

pact

occ

urs o

r ben

efits

will

not

m

ater

ialis

e W

ill th

e pr

ojec

t sup

port

loca

l em

ploy

men

t cre

atio

n?

E

mpl

oym

ent d

urin

g co

nstru

ctio

n S

hort-

term

job

crea

tion

for l

ocal

la

bour

and

tem

pora

ry s

ourc

e of

in

com

e.

Em

ploy

men

t of

non

-loca

l la

bour

w

ill re

duce

opp

ortu

nitie

s fo

r loc

al

labo

ur.

Will

the

proj

ect s

uppo

rt tra

inin

g an

d sk

ills d

evel

opm

ent o

f the

wor

kfor

ce?

E

stab

lishm

ent o

f tra

inin

g an

d sk

ills d

evel

opm

ent p

rogr

amm

es

for e

mpl

oyee

s.

Ski

lls d

evel

opm

ent o

f wor

kfor

ce,

pote

ntia

lly re

sulti

ng in

gre

ater

op

portu

nitie

s fo

r re-

empl

oym

ent a

t th

e en

d of

con

stru

ctio

n.

Con

stru

ctio

n sc

hedu

les

are

pres

suris

ed a

nd in

suffi

cien

t tim

e is

allo

cate

d to

trai

ning

and

ski

lls

deve

lopm

ent.

Will

the

proj

ect p

rovi

de o

ppor

tuni

ties

for S

MM

Es

and

BE

E g

roup

s?

S

ub-c

ontra

ctin

g S

MM

Es

and

BE

E g

roup

s to

sup

ply

good

s an

d se

rvic

es d

urin

g co

nstru

ctio

n

SM

ME

and

BE

E d

evel

opm

ent a

nd

grea

ter d

istri

butio

n of

con

stru

ctio

n ph

ase

expe

nditu

re.

No

suita

ble

SMM

Es

or B

EE

grou

ps a

re id

entif

ied

to te

nder

fo

r out

sour

ced

activ

ities

or

cont

ract

s ar

e no

t aw

arde

d to

S

MM

Es

or B

EE

gro

ups.

W

ill th

e pr

ojec

t inc

reas

e in

vest

or

conf

iden

ce in

the

Coe

ga ID

Z?

C

onst

ruct

ion

of th

e C

IPP

with

in

the

Coe

ga ID

Z/P

ort o

f Ngq

ura.

Fu

rther

inve

stm

ent i

n th

e C

oega

ID

Z, p

oten

tially

lead

ing

to g

reat

er

job

crea

tion

and

econ

omic

gro

wth

.

Stre

ngth

enin

g R

and

or p

oliti

cal

inst

abilit

y re

duce

s th

e in

cent

ive

for i

nter

natio

nal c

ompa

nies

to

inve

st in

Sou

th A

frica

. W

ill th

e pr

ojec

t lea

d to

furth

er in

-m

igra

tion

of jo

b-se

eker

s to

the

NM

MM

?

P

erce

ived

dire

ct a

nd in

dire

ct

empl

oym

ent o

ppor

tuni

ties

durin

g co

nstru

ctio

n fo

r uns

kille

d w

orke

rs.

In-m

igra

tion

of jo

b-se

eker

s fro

m

surr

ound

ing

area

s, w

hich

pla

ces

incr

ease

d pr

essu

re o

n so

cial

in

frast

ruct

ure

and

serv

ices

and

in

crea

ses

conf

lict o

ver l

imite

d em

ploy

men

t opp

ortu

nitie

s.

Exp

ecta

tions

and

co

mm

unic

atio

ns a

re n

ot

man

aged

and

infla

ted

job

oppo

rtuni

ties

are

publ

iciz

ed. N

o ad

ditio

nal g

over

nmen

t spe

ndin

g is

allo

cate

d to

pro

vide

bas

ic

infra

stru

ctur

e an

d se

rvic

es.

Will

the

influ

x of

con

stru

ctio

n w

orke

rs

and

job-

seek

ers

incr

ease

the

spre

ad

of H

IV/A

IDS

?

U

npro

tect

ed s

ex b

etw

een

cons

truct

ion

wor

kers

or m

igra

nt

job-

seek

ers

and

mem

bers

of

the

loca

l com

mun

ity.

Incr

ease

d sp

read

of H

IV/A

IDs

amon

gst t

he lo

cal p

opul

atio

n, th

e co

nstru

ctio

n w

orke

rs a

nd jo

b-se

eker

s, th

eir f

amili

es a

nd th

eir

hom

e co

mm

uniti

es.

Con

stru

ctio

n w

orke

rs re

mai

n un

awar

e of

the

risk

of H

IV/A

IDS

an

d/or

unw

illin

g to

cha

nge

sexu

al b

ehav

iour

.

C

oega

Int

egra

ted

Pow

er P

roje

ct: E

nvir

onm

enta

l Scr

eeni

ng S

tudy

Fi

nal R

epor

t, F

ebru

ary

2004

- C

onfi

dent

ial

page

11-

8

IMP

AC

T A

SSE

SSM

EN

T O

N T

HE

SO

CIO

-EC

ON

OM

IC E

NV

IRO

NM

EN

T

CH

AP

TE

R 1

1

Tabl

e 11

.3: O

pera

tions

pha

se so

cio-

econ

omic

issu

es

Issu

e/co

ncer

n id

entif

ied

Pote

ntia

l sou

rce

of im

pact

Po

tent

ial i

mpa

ct

Situ

atio

n un

der w

hich

neg

ativ

e im

pact

occ

urs o

r ben

efits

will

not

m

ater

ialis

e W

ill th

e pr

ojec

t sup

port

loca

l em

ploy

men

t cre

atio

n?

E

mpl

oym

ent d

urin

g op

erat

ions

. Lo

ng-te

rm e

mpl

oym

ent

oppo

rtuni

ties

for a

sm

all n

umbe

r of

loca

ls.

Em

ploy

men

t of n

on-lo

cal l

abou

r w

ill re

duce

opp

ortu

nitie

s fo

r loc

al

labo

ur.

Will

the

proj

ect s

uppo

rt tra

inin

g an

d sk

ills d

evel

opm

ent o

f the

wor

kfor

ce?

E

stab

lishm

ent o

f tra

inin

g an

d sk

ills d

evel

opm

ent p

rogr

amm

es

for e

mpl

oyee

s.

Ski

lls d

evel

opm

ent o

f wor

kfor

ce,

pote

ntia

lly re

sulti

ng in

gre

ater

op

portu

nitie

s fo

r re-

empl

oym

ent.

Ski

lls d

evel

opm

ent a

nd tr

aini

ng

prog

ram

mes

are

not

im

plem

ente

d.

Will

the

proj

ect p

rovi

de o

ppor

tuni

ties

for S

MM

Es

and

BE

E g

roup

s?

S

ub-c

ontra

ctin

g S

MM

Es

and

BE

E g

roup

s to

sup

ply

good

s an

d se

rvic

es d

urin

g op

erat

ions

.

SM

ME

and

BE

E d

evel

opm

ent

and

grea

ter d

istri

butio

n of

op

erat

ions

pha

se e

xpen

ditu

re

No

suita

ble

SMM

Es

or B

EE

grou

ps a

re id

entif

ied

to te

nder

for

outs

ourc

ed a

ctiv

ities

or c

ontra

cts

are

not a

war

ded

to S

MM

Es

or

BE

E g

roup

s.

Will

the

proj

ect i

ncre

ase

inve

stor

co

nfid

ence

in th

e C

oega

IDZ?

Ope

ratio

n of

the

CIP

P w

ithin

the

Coe

ga ID

Z/Po

rt of

Ngq

ura

and

the

avai

labi

lity

of g

as fo

r in

dust

rial p

roce

sses

.

Furth

er in

vest

men

t in

the

Coe

ga

IDZ,

pot

entia

lly le

adin

g to

gre

ater

jo

b cr

eatio

n an

d ec

onom

ic

grow

th.

Stre

ngth

enin

g R

and

or p

oliti

cal

inst

abilit

y re

duce

s th

e in

cent

ive

for i

nter

natio

nal c

ompa

nies

to

inve

st in

Sou

th A

frica

. W

ill th

e pr

ojec

t lea

d to

furth

er in

-m

igra

tion

of jo

b-se

eker

s to

the

NM

MM

?

U

nrea

listic

exp

ecta

tions

of

empl

oym

ent o

ppor

tuni

ties

for

unsk

illed

wor

kers

dur

ing

oper

atio

ns p

hase

.

In-m

igra

tion

of jo

b-se

eker

s fro

m

surr

ound

ing

area

s, w

hich

pla

ces

incr

ease

d pr

essu

re o

n so

cial

in

frast

ruct

ure

and

serv

ices

and

in

crea

ses

conf

lict o

ver l

imite

d em

ploy

men

t opp

ortu

nitie

s.

Exp

ecta

tions

and

co

mm

unic

atio

ns a

re n

ot

man

aged

and

infla

ted

job

oppo

rtuni

ties

are

publ

iciz

ed. N

o ad

ditio

nal g

over

nmen

t spe

ndin

g is

allo

cate

d to

pro

vide

bas

ic

infra

stru

ctur

e an

d se

rvic

es.

Will

the

oper

atio

n of

the

CIP

P

incr

ease

the

stab

ility

of p

ower

sup

ply

in th

e E

aste

rn C

ape?

P

ower

gen

erat

ion

by th

e C

IPP

pr

ojec

t in

the

Eas

tern

Cap

e.

Low

er ri

sk o

f pow

er fa

ilure

in th

e E

aste

rn C

ape.

C

IPP

pow

er g

ener

atio

n op

tion

not d

evel

oped

.

C

oega

Int

egra

ted

Pow

er P

roje

ct: E

nvir

onm

enta

l Scr

eeni

ng S

tudy

Fi

nal R

epor

t, F

ebru

ary

2004

- C

onfi

dent

ial

page

11-

9

IMP

AC

T A

SSE

SSM

EN

T O

N T

HE

SO

CIO

-EC

ON

OM

IC E

NV

IRO

NM

EN

T

CH

AP

TE

R 1

1

Tabl

e 11

.4: D

ecom

mis

sion

ing

phas

e so

cio-

econ

omic

issu

es

Issu

e/co

ncer

n id

entif

ied

Pote

ntia

l sou

rce

of im

pact

Po

tent

ial i

mpa

ct

Situ

atio

n un

der w

hich

neg

ativ

e im

pact

occ

urs o

r ben

efits

will

not

m

ater

ialis

e W

ill d

ecom

mis

sion

ing

resu

lt in

the

retre

nchm

ent o

f em

ploy

ees?

Dec

omm

issi

onin

g or

clo

sure

of

the

faci

litie

s.

Em

ploy

ees

are

retre

nche

d an

d en

ter i

nto

unem

ploy

men

t. N

o fin

anci

al p

lann

ing

or p

rovi

sion

of

ski

lls d

evel

opm

ent p

rogr

amm

e ha

s be

en m

ade

to s

uppo

rt re

trenc

hed

wor

kers

.

C

oega

Int

egra

ted

Pow

er P

roje

ct: E

nvir

onm

enta

l Scr

eeni

ng S

tudy

Fi

nal R

epor

t, F

ebru

ary

2004

- C

onfi

dent

ial

page

11-

10


CHAPTER 11

11.6 Scenarios to be considered in the Socio-economic study No alternative scenarios were considered. 11.7 Project alternatives No project alternatives were assessed. 11.8 Impact assessment Socio-economic impacts associated with the construction, operation and decommissioning of the CIPP are summarized in Tables 11.5 to 11.7 and discussed in the following section. 11.8.1 Construction phase During the three-four year construction phase, 2633 direct employment opportunities will be created during peak construction of which 2556 are expected to be local employment (refer to Table 11.1). The project will therefore support the short-term employment of unskilled and semi-skilled workers. The CDC’s Labour and Business Management Services aims to promote greater skills training and SMME development. The Labour Supply Services of the CDC are structured to supply personnel to contactors based on their individual needs. Should there be inadequate numbers of capable individuals on the LMS, it is expected that suitable individuals would be trained at local training institutions with funding from the Skills Development Levy Fund of the Department of Labour. Local training and skills development centers, organizations and institutions would be used for this purpose and may, therefore, also benefit through an increase in the number of enrolled trainees. The extent to which the project proponent adopts these principles, utilizes the CDC’s services and actively works to translate principles into practice will largely determine the magnitude of the positive impact and the success of these initiatives. The Coega IDZ is still in the process of securing its first anchor tenant. It can be expected that the provision of gas, as well as the increased stability of power supply in the Eastern Cape, resulting from the successful development of the CIPP would provide further incentive and confidence to foreign investors to locate their operations within the Coega IDZ. By requiring that job-seekers register on the CDC’s employment database, and with the emphasis on the use of local labour for unskilled or skilled jobs, very few construction workers from outside the NMMM are expected to be employed. In this way the CDC hopes to minimize the influx of opportunistic job-seekers from outside of the NMMM. However, in light



page 11-11


CHAPTER 11

of the pressures driving people from the rural areas to urban areas, in-migration is unavoidable. It would be virtually impossible to determine the percentage of migrants coming into the NMMM due to the proposed CIPP alone. While the CIPP cannot be expected to assume sole responsibility for the in-migration, it cannot ignore partial responsibility. Potential impacts, which could be associated with the influx of people, are:

Increased demand for land and housing.

Increased demand for municipal services.

Health risks associated with inadequate sanitation facilities where informal settlement occurs.

Increased demands on health and community services.

Increased criminal activity associated with a swelling of the ranks of poor people in the area but also by criminal opportunists intent on exploiting the situation.

Conflict with current residents over economic and natural resources.

In order to minimize pressure on housing required during the construction period to accommodate semi-skilled and skilled personnel who cannot be sourced locally, the CDC has taken responsibility for the establishment of a construction village for IDZ developments at Joorst Park and Wells Estate. In terms of the rezoning of the IDZ, no residential area is to be allowed within the zone. Therefore, no developer will be allowed to construct and run their own on-site construction village and will be required to make use of the CDC construction village.

Construction activities are renowned for increasing the spread of diseases such as HIV/AIDS through the sexual behaviour of construction workers and other migrant job-seekers who are on temporary contracts away from their homes and families. The negative impact of the disease is experienced both in the local community as well as in the communities from which the construction worker or job-seeker originates.

11.8.2 Operations phase Operation of the CIPP would require approximately 132 full-time, permanent, long-term employment positions. About 129 of these positions would be occupied by South Africans. Although the operations phase provides fewer employment opportunities for the unskilled and semi-skilled workforce, the positive impact of employment creation at the local scale during operations remains important. Despite the smaller workforce during operations and the decreased number of opportunities for outsourcing the delivery of goods and services to SMMEs and BEEs, positive impacts in the form of greater distribution of wealth and skills development are expected. This is,



page 11-12


CHAPTER 11

however, largely dependent on the development and implementation of appropriate and supportive procurement policies, mentorship and training programmes. As for the construction phase, the establishment of the CIPP within the Coega IDZ is expected to serve as an additional incentive to attract additional foreign investors who require gas for their industrial processes and are looking for a secure power supply. Despite the small number of jobs created by the project during the operations phase, in-migration to the area is still expected by job-seekers hoping to secure some form of employment on projects within the Coega IDZ or Port of Ngqura. The magnitude of this influx of job-seekers and it’s potential negative impact on available infrastructure and services is difficult, if not impossible, to predict. The current power supply system to the Eastern Cape is reaching maximum capacity and will require the establishment of additional infrastructure to increase the security of supply in the near future. The development of the Coega IDZ and the potential for high-energy users to locate within the IDZ will place increasing pressure on the existing transmission line system. Local power generation in the form of the gas fired power plant therefore provides an opportunity to meet this shortfall, as well as to potentially reduce the immediate requirement for additional transmission lines through the important tourist routes in the near future. 11.8.3 Decommissioning phase Decommissioning of the LNG terminal and/or the CCGT power plant will result in the retrenchment of employees, as well as the termination of services provided by sub-contractors. If these individuals are unable to find alternative employment, they will increase the unemployment numbers in the NMMM.



page 11-13

IMP

AC

T A

SSE

SSM

EN

T O

N T

HE

SO

CIO

-EC

ON

OM

IC E

NV

IRO

NM

EN

T

CH

AP

TE

R 1

1 Ta

ble

11.5

: Con

stru

ctio

n ph

ase

soci

o-ec

onom

ic im

pact

s

C

oega

Int

egra

ted

Pow

er P

roje

ct: E

nvir

onm

enta

l Scr

eeni

ng S

tudy

Fi

nal R

epor

t, F

ebru

ary

2004

- C

onfi

dent

ial

page

11-

14

Pote

ntia

l im

pact

St

atus

Si

gnifi

canc

e D

egre

e of

con

fiden

ce

Pote

ntia

l fat

al fl

aw

Sho

rt-te

rm jo

b cr

eatio

n fo

r loc

al la

bour

an

d te

mpo

rary

sou

rce

of in

com

e.

Pos

itive

H

igh,

255

6 lo

cal

empl

oym

ent o

ppor

tuni

ties

will

be c

reat

ed fo

r a s

hort

perio

d of

tim

e du

ring

peak

co

nstru

ctio

n.

Hig

h, a

s th

ere

is a

def

inite

re

quire

men

t for

con

stru

ctio

n w

orke

rs a

nd th

e C

DC

’s jo

b-se

eker

s re

gist

er e

nsur

es

pref

eren

tial e

mpl

oym

ent o

f loc

al

labo

ur.

No,

this

is a

pos

itive

impa

ct.

Ski

lls d

evel

opm

ent o

f wor

kfor

ce,

pote

ntia

lly re

sulti

ng in

gre

ater

op

portu

nitie

s fo

r re-

empl

oym

ent.

Posi

tive

Hig

h, a

s sk

ill de

velo

pmen

t is

a c

ritic

al c

ompo

nent

of

soci

o-ec

onom

ic

deve

lopm

ent.

Low

, as

fu

rther

in

form

atio

n is

re

quire

d on

the

CD

C’s

and

EP

C’s

sk

ills

deve

lopm

ent

and

train

ing

prog

ram

mes

.

No,

this

is a

pos

itive

impa

ct.

SM

ME

and

BE

E d

evel

opm

ent a

nd

grea

ter d

istri

butio

n of

con

stru

ctio

n ph

ase

expe

nditu

re.

Posi

tive

Hig

h, a

s th

e pr

ojec

t is

expe

cted

to p

rovi

de

oppo

rtuni

ties

for s

ub-

cont

ract

ing

serv

ices

to

SM

ME

s an

d B

EE

s.

Low

, as

fu

rther

in

form

atio

n is

re

quire

on

th

e ty

pe

of

oppo

rtuni

ties

avai

labl

e to

SM

ME

s an

d B

EE

ent

ities

.

No,

this

is a

pos

itive

impa

ct.

Furth

er in

vest

men

t in

the

Coe

ga ID

Z,

pote

ntia

lly le

adin

g to

gre

ater

job

crea

tion

and

econ

omic

gro

wth

.

Posi

tive

Hig

h, a

s th

e ec

onom

ic

viab

ility

and

succ

ess

of th

e ID

Z an

d th

e P

ort o

f Ngq

ura

hing

es o

n in

vest

men

t by

key

anch

or te

nant

s.

Hig

h.

No,

this

is a

pos

itive

impa

ct.

In-m

igra

tion

of jo

b-se

eker

s fro

m

surr

ound

ing

area

s w

hich

pla

ces

incr

ease

d pr

essu

re o

n so

cial

in

frast

ruct

ure

and

serv

ices

and

in

crea

ses

conf

lict o

ver l

imite

d em

ploy

men

t opp

ortu

nitie

s.

Neg

ativ

e H

igh,

as

soci

al s

ervi

ces

and

infra

stru

ctur

e is

al

read

y in

suffi

cien

t to

mee

t cu

rren

t dem

ands

.

Hig

h,

as

in-m

igra

tion

will

defin

itely

re

sult

in

incr

ease

d pr

essu

re b

eing

pla

ced

on s

ocia

l se

rvic

es a

nd in

frast

ruct

ure.

No,

in

-mig

ratio

n is

ex

pect

ed

to

occu

r w

heth

er o

r no

t th

e pr

ojec

t pr

ocee

ds.

Incr

ease

d sp

read

of H

IV/A

IDs

amon

gst

the

loca

l pop

ulat

ion,

the

cons

truct

ion

wor

kers

, the

ir fa

mili

es a

nd th

eir h

ome

com

mun

ities

.

Neg

ativ

e H

igh,

as

the

spre

ad o

f H

IV/A

IDS

has

sig

nific

ant

soci

al, e

cono

mic

and

cu

ltura

l con

sequ

ence

s.

Hig

h, i

t is

gen

eral

ly u

ndis

pute

d th

at

HIV

/AID

S

is

a se

rious

co

ncer

n in

Sou

th A

frica

.

No,

thi

s im

pact

is a

ssoc

iate

d w

ith

any

cons

truct

ion

proj

ect.

IMP

AC

T A

SSE

SSM

EN

T O

N T

HE

SO

CIO

-EC

ON

OM

IC E

NV

IRO

NM

EN

T

CH

AP

TE

R 1

1 Ta

ble

11.6

: Ope

ratio

ns p

hase

soci

o-ec

onom

ic im

pact

s

Pote

ntia

l Im

pact

St

atus

Si

gnifi

canc

e D

egre

e of

con

fiden

ce

Pote

ntia

l fat

al fl

aw

Long

-term

em

ploy

men

t opp

ortu

nitie

s fo

r a s

mal

l num

ber o

f loc

als.

P

ositi

ve

Low

, per

man

ent

empl

oym

ent

oppo

rtuni

ties

asso

ciat

ed

with

the

proj

ect a

re

smal

l.

Hig

h, e

mpl

oym

ent n

umbe

rs

are

unlik

ely

to c

hang

e si

gnifi

cant

ly fr

om th

ose

incl

uded

in th

e G

loba

l Ins

ight

re

port.

No,

this

is a

pos

itive

impa

ct.

Ski

lls d

evel

opm

ent o

f wor

kfor

ce,

pote

ntia

lly re

sulti

ng in

gre

ater

op

portu

nitie

s fo

r re-

empl

oym

ent.

Posi

tive

Hig

h, a

s sk

ill de

velo

pmen

t is

a cr

itica

l co

mpo

nent

of s

ocio

-ec

onom

ic d

evel

opm

ent.

Low

, as

furth

er in

form

atio

n is

re

quire

d on

the

JPD

A’s

ski

lls

deve

lopm

ent a

nd tr

aini

ng

prog

ram

mes

.

No,

this

is a

pos

itive

impa

ct.

SM

ME

dev

elop

men

t and

gre

ater

di

strib

utio

n of

ope

ratio

ns p

hase

ex

pend

iture

Posi

tive

Med

ium

, as

the

proj

ect i

s ex

pect

ed to

pro

vide

fe

wer

opp

ortu

nitie

s fo

r su

b-co

ntra

ctin

g se

rvic

es

to S

MM

Es a

nd B

EEs

than

dur

ing

the

cons

truct

ion

phas

e.

Low

, as

furth

er in

form

atio

n is

re

quire

on

the

type

of

oppo

rtuni

ties

avai

labl

e to

S

MM

Es

and

BE

E e

ntiti

es.

No,

this

is a

pos

itive

impa

ct.

Furth

er in

vest

men

t in

the

Coe

ga ID

Z,

pote

ntia

lly le

adin

g to

gre

ater

job

crea

tion

and

econ

omic

gro

wth

.

Posi

tive

Hig

h, a

s th

e ec

onom

ic

viab

ility

and

succ

ess

of

the

IDZ

and

the

Por

t of

Ngq

ura

hing

es o

n in

vest

men

t by

key

anch

or te

nant

s.

Hig

h.

No,

this

is a

pos

itive

impa

ct.

In-m

igra

tion

of jo

b-se

eker

s fro

m

surr

ound

ing

area

s w

hich

pla

ces

incr

ease

d pr

essu

re o

n so

cial

in

frast

ruct

ure

and

serv

ices

and

in

crea

ses

conf

lict o

ver l

imite

d em

ploy

men

t opp

ortu

nitie

s.

Neg

ativ

e H

igh,

as

soci

al s

ervi

ces

and

infra

stru

ctur

e is

al

read

y in

suffi

cien

t to

mee

t cur

rent

dem

ands

.

Hig

h, a

s in

-mig

ratio

n w

ill

defin

itely

resu

lt in

incr

ease

d pr

essu

re b

eing

pla

ced

on

soci

al s

ervi

ces

and

infra

stru

ctur

e.

No,

in-

mig

ratio

n is

exp

ecte

d to

oc

cur w

heth

er o

r not

the

proj

ect

proc

eeds

.

Low

er ri

sk o

f pow

er fa

ilure

in th

e E

aste

rn C

ape.

Po

sitiv

e H

igh,

as

soci

o-ec

onom

ic

deve

lopm

ent i

n th

e E

aste

rn C

ape

hing

es o

n th

e su

pply

of e

lect

ricity

.

Hig

h, a

s it

is w

idel

y st

ated

that

cu

rren

t po

wer

sup

plie

s to

the

E

aste

rn C

ape

are

unst

able

.

No,

this

is a

pos

itive

impa

ct.

C

oega

Int

egra

ted

Pow

er P

roje

ct: E

nvir

onm

enta

l Scr

eeni

ng S

tudy

Fi

nal R

epor

t, F

ebru

ary

2004

- C

onfi

dent

ial

page

11-

15

IMP

AC

T A

SSE

SSM

EN

T O

N T

HE

SO

CIO

-EC

ON

OM

IC E

NV

IRO

NM

EN

T

CH

AP

TE

R 1

1

Tabl

e 11

.7: D

ecom

mis

sion

ing

phas

e so

cio-

econ

omic

impa

cts

Po

tent

ial I

mpa

ct

Stat

us

Sign

ifica

nce

Deg

ree

of c

onfid

ence

Po

tent

ial f

atal

flaw

E

mpl

oyee

s ar

e re

trenc

hed

and

ente

r in

to u

nem

ploy

men

t. N

egat

ive

Med

ium

, as

the

CIP

P

empl

oys

a re

lativ

ely

smal

l num

ber o

f em

ploy

ees

durin

g th

e op

erat

ions

pha

se.

Med

ium

, as

the

sign

ifica

nce

of

the

impa

ct

depe

nds

on

surr

ound

ing

soci

o-ec

onom

ic

circ

umst

ance

s at

the

tim

e of

de

com

mis

sion

ing.

No,

how

ever

, ear

ly p

lann

ing

for

man

agin

g de

com

mis

sion

ing

impa

cts

will

redu

ce th

e se

verit

y of

this

impa

ct.

C

oega

Int

egra

ted

Pow

er P

roje

ct: E

nvir

onm

enta

l Scr

eeni

ng S

tudy

Fi

nal R

epor

t, F

ebru

ary

2004

- C

onfi

dent

ial

page

11-

16


CHAPTER 11

11.9 Specification of environmental thresholds No environmental thresholds have been identified. 11.10 Recommendations for project planning and design

Maximise the use of local labour as far as possible through the use of the CDC’s Labour Management Services.

Ensure recruitment measures are aimed particularly at construction workers classified as designated employees in terms of the Employment Equity Act (black people, as defined in the Act, women and disabled people).

Consider employment opportunities and the needs of disabled people during the planning of construction and operational activities.

Ensure that contractors stipulate percentages of local labour to be employed, use of SMMEs and training provision in their contract (as stipulated in the Zone Labour Agreement and Project Labour Agreement).

Facilitate opportunities for SMMEs, where appropriate and applicable, through requiring the inclusion of SMME partners in the submission of bids for contract tenders.

Establish linkages with the CDC’s SMME Development Management to determine which areas of SMME expertise are in existence and which can be used during construction and operation.

Establish linkages with local institutions involved in the development and promotion of SMMEs such as COMSEC, PERMAC and BEEF in order to benefit from the experience gained through existing initiatives.

Make multi-skilling of construction workers an important priority as employment opportunities during construction are only temporary. This refers, not necessarily to providing the skills necessary for operational jobs on the CIPP, but also skills which can be applied in other industries in the Coega IDZ and the NMMM.

Actively downplay (through clear, simple and persistent communication) inflated expectations of employment opportunities. Also, communicate in the same manner that recruitment will only take place through the CDC’s Labour Management System, at designated recruitment centres and not on-site.

Establish an HIV/AIDS awareness programme for construction workers in conjunction with the CDC and NPA.

11.11 Recommendations for baseline monitoring No recommendations for baseline monitoring prior to the EIA have been identified.



page 11-17

CHAPTER 11fred.csir.co.za/project/CIP_EIA/pages/ESS_ch11.pdf · IMPACT ASSESSMENT ON THE...

Documents

Transcript of CHAPTER 11fred.csir.co.za/project/CIP_EIA/pages/ESS_ch11.pdf · IMPACT ASSESSMENT ON THE...