OPINION

SABS in crisis - Dean Macpherson

DA MP says SA cannot afford to have a dysfunctional standards and certification body

Crisis at the South Africa Bureau of Standards (SABS) puts all South Africans at risk

The dysfunction and lack of accountability at the South Africa Bureau of Standards (SABS) has forced the Minister of Trade and Industry, Rob Davies, to demand that the SABS Board ‘urgently oversee a detailed process to develop a turnaround strategy for SABS’. Of major concern is that SABS seems unable to account for operational assets under its management.

This was revealed in a response to a DA Parliamentary question in which we had asked the Minister to account on the concerns raised by industry players on SABS’s testing function.

SABS is a statutory body established in terms of the Standards Act, 1945 and is tasked with developing, promoting and maintaining South African National Standards in terms of quality on commodities, products and services.

The DA will now write to the Minister asking him to provide specific timelines as to when he expects the turnaround strategy at SABS to be finalised, including the register of assets under its management.

The DA’s questions to the Minister about SABS also come on the back of SABS irregularly certifying substandard coal by Gupta-linked mines in order to facilitate the suspension imposed by Eskom and pave way for the Tegeta contract to go ahead.

The admission by the Minister on SABS dysfunctionality comes as no surprise as the entity ran a R44,3 million loss in the 2016/17 financial year. It has become urgent, now more than ever, that the turnaround strategy proposed by the Minister be formulated and implemented as a matter of urgency to reverse the precarious financial position that SABS finds itself in.

Further admissions by Minister Davies in response to questions I posed regarding SABS include:

The inability of SABS to confirm the names of laboratories conducting partial testing of products;

The SABS is unable to confirm how many expired Marks are being used, what these products are and when they expired;

The SABS only has one Executive Board Member who has not resigned since 2015 pointing to a serious governance issue;

The SABS was unable to account for how many customers it has lost in the two previous financial years and what the cost to the SABS has been; and

That the CEO has a driver approved by the Board for reasons and costs unknown.

South Africa cannot afford to have a dysfunctional standards and certification body as this negatively impacts businesses who rely on standards for market access and growth.

It is unacceptable that SABS is unable to provide information about testing facilities that are no longer functional or which need upgrading and the related costs. It exposes the poor accounting and internal control measures within SABS, which could be a violation of Public Sector Internal Audit Standards.

If there is one thing we are certain about at SABS is that chaos and disorder seem to be the only benchmark that they are being measured against.

The DA looks forward to receiving a time bound SABS turnaround strategy from the Minister that will ensure that sanity is restored at the entity and it continues to fulfil its statutory requirements effectively.

Text of reply:

THE NATIONAL ASSEMBLY

QUESTION FOR WRITTEN REPLY

650. Mr D W Macpherson (DA) to ask the Minister of Trade and Industry:

What (a) number of laboratories does the SA Bureau of Standards have, (b) number of the specified laboratories are conducting full testing of products, (c) are the names of the laboratories that are conducting partial testing of products, (d) would it cost to bring each partial testing laboratory up to standard so that full testing can be conducted at every laboratory and (e) equipment is needed at each laboratory?

Response:

According to information provided by the management of the South African Bureau of Standards (SABS):

a) The SABS has 30 business units undertaking testing.

b) The SABS conducts testing as part of conformity assessment in line with the prescripts of ISO 17 000. Testing falls into 3 categories as follows; Third Party Testing where a product complies fully with a standard and the testing activities were conducted by an independent third party (SABS); Second Part Testing where the SABS tests products on behalf of another institution which defines the required specification and First Party Testing where the SABS provides product development support to manufacturing companies.

c) The management of the SABS has not provided a satisfactory response containing the requisite information. I have written to the SABS management demanding that they do in fact provide an urgent response to the Department of Trade and Industry.

d) As above.

e) As above.

The Department of Trade and Industry is the only shareholder of the SABS. In my capacity as the Minister of Trade and Industry, in the light of the above and with respect to ongoing concerns relating to the SABS testing function, I recently gave instructions to the SABS Board to urgently oversee a detailed process to develop a turnaround strategy for SABS. This will, inter alia, fully scope all the existing SABS testing facilities and their respective capabilities, those which are no longer functional or have been degraded; the cost of

maintaining and/or upgrading and reopening those facilities which are critical to SA’s industrialisation effort; resolve any legal issues which may stand in the way of undertaking partial testing and conduct a review of the three technical infrastructure Acts. I shall provide a full report to Parliament in this regard in due course.

ENDS

Statement issued by Dean Macpherson MP, DA Shadow Minister of Trade and Industry, 18 March 2018