CAMPROSA INTERNATIONAL

CONFERENCE

INSOURCING VS OUTSOURCING

05 SEPTEMBER 2016

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DELEGATION

PSiRA Delegation:

• Prof NM Mazibuko : Chairperson of Council

PSiRA

• Mr. Manabela Sam Chauke : Chief Executive Officer

PSiRA

PRIVATE SECURITY INDUSTRY REGULATORY AUTHORITY (PSiRA)(T:) +27 12 003 0600/01

(F:) +27 86 212 8616420 Witch-Hazel Avenue,

Block B –Eco Glades 2 Office Park,

Highveld Ext 70http://www.psira.co.za/

PRESENTATION OVERVIEW

PART A: About PSiRA

– Brief Background

– Governance Structure

– Statutory Mandate

PART B: ABOUT THE INDUSTRY

– Industry Size

– Sectors and Categories

– Commercial and In-house Service Providers

PART B: ABOUT INSOURCING

– What must be considered

– Impact of Insourcing

– Recommendations

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Part A :About PSiRA

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Brief Background about PSiRA

Chapter 11 of Constitution of the Republic of South Africa , Act 108 of

1996 , section 199 (3) Establishment , Structuring and Conducting

of security services

Section 199 (3) “Other armed organizations and services by National

Legislation"

PSIRA is a statutory body established in terms Sec 2 of Act 56 of 2001

PSIR Act came into effect on 14 February 2002 and governed by a

Council

Before this the industry was regulated by the Security Officers’ Board in

terms of the 1987 Act

In terms of the old Act, In-House Security providers were excluded

from regulation by the Board

There are various rights and duties that the Authority places on the SSP

in-house employers and on Security Service Consumers (clients)

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ORGANISATIONAL STRUCTURE

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ArcadiaH/O :Centurion

Head Office / Regional Offices Satellite Offices

National Offices _____________________________________________________________________

Legislative Mandate

The primary objectives of PSiRA are to regulate the private security

industry and to exercise effective control over the practice of the

occupation of security service provider in the public and national

interest and in the interest of the private security industry itself.

SUMMARY OF THE MANDATE:

Promote a legitimate Industry subject to the Constitution and other laws of the Country;

Ensure the Industry act in public and national interest;

Determine and enforce minimum occupational conduct by service providers;

Ensure transparent, fair, objective and timeous registration process;

Ensure compliance through active monitoring and investigation of service providers; and

Promote services that responds to the need of users and of the community,

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Part: BAbout the Industry

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Size of the Industry

Registered and active security businesses per province:

Gauteng - 3 712

Eastern Cape - 783

Western Cape - 1 020

Limpopo - 861

N/West Prov. - 403

Free State - 222

N/Cape - 137

KZN - 1 657

Mpumalanga - 543

Market Share by Province

40%GP

6%

MP

8%

EC

11%

WC9%

LMP

4%NW

2%FS

1%

NC18%

KZN

Gauteng

Mpumalanga

Eastern Cape

Western Cape

Limpopo

North West

Free State

Northern Cape

KwaZulu-Natal

Industry Categories

Guarding Sector

Close Protection

Response Security

Assets In transit

Events Security

Manufacturers

,Importers and

distributors

Locksmiths; and

Security advisory

Electronic Security

Security Training

Private Investigators

K9 Units etc

Which do you Insource?

Sector Market Share

Guarding Sector

> R80 Billion/Annum

Electronic Sector

(Price Unregulated)

Other Sectors

(untapped)

= Rand

Guards= Active No

Active No * Average Cost

of Service *12 Months=

Total Cost Per Annum

Commercial vs In-house Security Services

In-house employs security officers for self protection

Security Service Provider – renders service to another

person for remuneration , fee , reward or benefit.

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In-House

RetailSector

Public Sector

Neighbourhood Watch

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Part: CAbout Insourcing

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Factors to Consider

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Insourcing , What we

must consider?

Factors to Consider

Obligations in terms of PSIRA ACT

Registration as in-house employer

Annual amount payable by business – R3 500-00 per annum

Obligations in terms of Private Security Industry Regulations

Only use employees registered as security service providers (ensure

registration / training, etc.)

Comply with deductions of annual amounts payable by security service

providers

Keeping of documents at an accessible administrative office for minimum

of 4 years

Updating records within 7 days after changes

Keeping records electronically or in document format. If electronic, back-

up copies must be made

Compliance imperatives

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Factors to Consider

Compliance Imperatives

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Legal authorization in respect of firearms, deductions of annual fees

- Reporting changes to the Authority

- Uniform and firearm requirements (Regulation 13)

Obligations in terms of Code of Conduct Regulations

- Inspections by PSIRA to verify compliance

- Security service providers (in-house) must comply with all

obligations in terms of COC

- Appoint responsible person to manage and oversee security service

providers

- Responsible person must ensure compliance with Act & Regulations

Factors to Consider

Cost of Non-Compliance

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Non Compliance constitute improper conduct and criminal office

Fines up to R1 million per count

Fines up to R 100 000 for failure to pay annual fees

Labour unrest (security industry and in-house environment)

Additional security needs for specific time periods / projects

Uniform / firearm requirements

Supervision / control (24/7)

Oversight and regulation by PSIRA / DOL / Bargaining Council, etc.

Security not core business (no expertise)

Annual training to all security service providers on legal provisions

regarding regulation of the industry

Impact of Insourcing

On the Regulator

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Non Compliance constitute improper conduct and criminal office

inspector / security business ratio will increase

Monitoring of conduct will significantly be reduce

Current Funding Model will have to be revised

Impact of Insourcing

On the Service Officer

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Wages will improve and benefit guards significantly

Exploitation may increase due to reduced monitoring

Proposed Bargaining Council will fail to take off

Sectoral Determination 6 will not apply

On the Service Provider

Guarding Sector will disappear

Loss of business will impact financial on sustainability

Impact of Insourcing

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On the Consumer

More collusion with staff

Risk will have to be absorbed internally

Cost of Insurance may increase due to lack of professional standards

PSiRA on Insourcing

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Opinion and recommendations

Complete Insourcing of security services not Supported by PSiRA: IHEs and

other training institutions do not have the capacity to deliver all or most service

categories outlined on S12

Hybrid model to insource specific catgories personnel but outsource expertise

may be a solutions: IHEs determine and agree on %, pros and cons for

insourcing [based on common safety and security needs within the public higher

education and training sector; benefits for permanent staff including benefits for

their children at IHEs].

Co-operatives with proper management and support structures may be an

alternative to insourcing [?????]

Insourcing will negatively impact on the Private Security industry.

PSiRA on Insourcing

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Opinion and recommendations

The cost of security services sky rocket as only unregulated service may prevail

Safety and security essential support service: require appropriate skills,

accountability, knowledge and tools [ICT, Security Vetting].

Insourcing will negatively impact on the Private Security industry

In-house infrastructure at IHEs will be massive if not impossible. QUESTION: Is

security core business of IHEs?

IHEs develop a Comprehensive Safety & Security Plan informed amongst other

things by core safety and security needs in higher education and training, time

& space, technology era; capabilities & technologies for safety and security.

Opinion and Recommendations

Other critical players with relevant expertise: [SAPS; PSI, student leadership,

Unions of workers in the industry] – Have open robust indaba on safety &

security: short and long term.

Need for INTELLIGENCE WAYS OF MONITORING + INTEGRITY OF DATA/INFO

which inform need and nature of outsourcing/insourcing.

IHE develop culture of scanning safety and security environment vs crises

response.

Preventive measures: stability in other aspects of campus life, eliminate

stressors within IHEs systems, processes and procedures.

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Impact of Insourcing

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Opinion and recommendations

Safety & security be integrated into other aspects of campus life [

enrolment plans for projections; living and learning, registration,

events, physical access, policies on academic inclusion/exclusion,

accommodation, fees/increments]

Skills for 21stCentury [technical, analytical, develop models for safety

& security, projections].

Risk of non-compliance will increase.

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Thank You

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