Notice No. R612 in the Government Gazette No. 24826 of 9 May 2003 shows that the 2003 SABS levies on single and three phase earth leakage unit protection units (ELPUs) have been increased by a factor of 4,95 times higher than those for 2002.
Earlier, at the relevant industry consultative forum (the SABS Electrotechnical Association Quarterly Meeting, or EAQM), Iqshaan Alladin, head of the electro-technical and gaming section at the SABS Regulatory Affairs division, had proposed that the SABS levies on electrical equipment covered by compulsory standards be increased generally in line with inflation by 7%, except for single and three phase ELPUs where the levies were proposed to be increased by 350%. Despite industry objections to the huge proposed ELPU levy increase, the Government Gazette now shows even higher increases than those proposed or discussed with the affected industry.
The actual 2003 levy increase makes the levy on single phase ELPUs by far the highest in the schedule, at about 7,9% of average retail market selling price. This is followed closely by the levy on three phase ELPUs at about 5,2%, and on low voltage moulded case/miniature circuit breakers (MCCBs) at about at 4% of average market selling price. The levies on all the remaining electrical products in the schedule (i.e. excluding ELPUs and MCCBs) average an order of magnitude lower, at less than 0,5% of market selling price.
In terms of the Standards Act, 1993, the SABS derives income from levies it applies on locally manufactured or imported electrical products sold in South Africa that are covered by compulsory standards. In general, SABS standards are voluntary, but the minister of Trade and Industry may declare any standard compulsory for the protection of health and safety, the consumer and/or the environment. In the electro-technical sector, there are presently a number of compulsory standards affecting products such as MCCBs, ELPUs, lampholders, luminairs, incandescent lamps, starters for fluorescent lamps, plugs, socket outlets, socket adapters, switches, cord sets, extension cords, cables, electric power tools, domestic appliances, hi-fi systems, radios, TV, VCR and IT equipment.
Iqshaan Alladin, head of the electro-technical and gaming section at the SABS Regulatory Affairs division, explains that the levies are "in fact a tax", intended to fund the regulatory processes of the SABS and the enforcement of compulsory standards, an activity the SABS handles on behalf of the Departments of Labour and Trade & Industry.
But while the SABS' regulatory and enforcement activities apply to all electrical products covered by compulsory standards, the SABS Regulatory Affairs division in fact only applies the levies on those electrical products covered by compulsory standards that do not bear the (voluntary) SABS mark - this despite the fact that the SABS mark scheme has nothing to do with the regulatory process, but is a voluntary marketing scheme operated on a commercial basis by a (nominally) independent commercial company of the SABS.
Moreover, in the words of Jaco van Heerden PrEng, of the SABS' National Electrical Test Facility (NETFA), "the present situation regarding circuit breaker and earth leakage specifications can best be described as out of control. The respective specifications in their present form make them basically worthless for both technical and commercial decisions" (ENERGIZE, July/August 2001 issue, page 4). And the compulsory SABS ELPU and MCCB standards/specifications have not changed since then.
There are perceptions in the industry that levies applicable only to non-SABS mark bearing products represent an unfair, discriminatory and anti-competitive regulatory practice, and that the SABS' regulatory and enforcement activities for compulsory standards in fact apply equally to SABS mark bearing electrical products too. There are also perceptions that the huge increase in levies on ELPUs represents a non-transparent trade barrier to the detriment of the consumer, and to the benefit of the SABS Regulatory Affairs division, without any corresponding agreed or actual increase in service levels.
Industry unhappiness with the massive levy increase is reflected in recent correspondence and letters of objection sent to the SABS by the EEAIA* and ESASA**. ESASA has questioned why the huge ELPU levy increase went ahead despite prior written assurances from the SABS Regulatory Affairs division that the levy increase had been concluded at the inflationary related increase of 7%, and that the formal comments received from ESASA and EMASA*** had been addressed accordingly.
To questions regarding the process by which levies and increases in levies are determined, as well as the relevant procedures applicable in order to initiate a review and/or appeal against the huge increases, the SABS Regulatory Affairs division responds that "the levy increases are submitted to the SABS Council for deliberation and approval after consultation with industry. After receiving Council approval, the proposed levies are submitted to the minister of Trade and Industry, who finally gazettes them in government notices". SABS president and acting head of the SABS Regulatory Affairs division, Eugene Julies, also points out that while the SABS does consult with the affected industry, it was not obliged to, and that the levies "are solely imposed at the discretion of the SABS, and no provision is made (in the Standards Act) either for negotiation or indeed consultation on these issues". Questions are also being asked in the industry about the service levels and value provided by the SABS Regulatory Affairs division in the light of the ever-increasing levies it imposes. Since 1998, the levy on single phase ELPUs has increased by over 2000%, and on three phase ELPUs by over 1500%. On this issue, Julies responds that "indeed, there has to be no relationship whatsoever between those fees and the deliverables, which in this case are the inspections, tests, etc. carried out in the regulatory domain" and "the Standards Act in fact REQUIRES us to maximise our returns".
But while SABS president Eugene Julies clearly believes that the affected industry does not have the right of review or appeal against the levies imposed by the SABS, affected industry associations believe that they have the right to call the SABS to account for the significant increases in SABS levies over the years, the way the levies are decided upon and applied, and the regulatory service levels funded by the levies that the SABS provides to the industry and the public.
Notes:
* The Electrical Engineering and Allied Industries Association (EEAIA) is an industry association of about 150 local and multi-national electrical manufacturing and supply companies, administered under the umbrella of the Steel and Engineering Industries Federation of South Africa (SEIFSA).
** The Electrical Switchgear Association of South Africa (ESASA) is an industry association comprising major manufacturers, importers and suppliers of electrical switchgear components and assemblies in South Africa.
*** The Electrical Manufacturers Association of South Africa (EMASA) is an industry association chaired by Helmuth Fischer, MD of Circuit Breaker Industries (CBI), the predominant local manufacturer of domestic and commercial ELPUs and MCCBs.
Chris Yelland CEng
Managing Editor
EE Publishers (Pty) Ltd
P O Box 458, Muldersdrift 1747, South Africa
Tel: (011) 659-0504
Fax: (011) 659-0501
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E-mail: [email protected]
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