Collaborative research case study: Social impact assessment study

In October 2013 we commissioned a social impact assessment for our Rustenburg operation. From the onset Implats acknowledges the positive impact of mining in stimulating economic growth and job creation. At the same time there is an acknowledgment of the negative factors that can arise as a consequence of in-migration that increase social pressures due to increased competition for limited resources. While the study covered all surrounding villages at the operations, the focus was on 14 immediate villages directly impacted by the operations as well as one informal settlement – Freedom Park.

The aim of the study was to:

• Obtain a global view of developments that have occurred in the areas of operation over the last 10 years, and begin to understand the social trends that are influenced by mining activities.
• Determine a historical base from which the organisation will be able to monitor, evaluate and track the impacts of future interventions and to take lessons where relevant that will inform future interventions.
• Identify potential risks in current and future areas of operation and determine strategies to turn such risks into opportunities. These need to take into account areas in which mining will decline and those areas where new operations will start, aligned to a clear time horizon.
• Find areas for strategic collaboration with key stakeholders on future interventions and to develop a holistic corporate strategy.

Limitations of the study:

• The strike had an impact on the intermittent availability of migrant workers in the communities, particularly those who work for mining companies and auxiliary industries during field work, and hence revisits had to be conducted where people were not available.
• The study coincided with the national elections, a period dominated by electioneering. This impacted, to some extent, the willingness by some of the households to participate. Refusals to participate in the census, especially mining households, were at 19% for Freedom Park and 15% for RBN villages. This is statistically acceptable, given that the national census of 2011 had an uncounted rate of 16%.
• The study did not include non-Bafokeng areas such as other informal settlements surrounding the Bafokeng villages and land owned by other private entities. This thus had an impact on the demographic count in comparison to the 2011 census.
• These limitations may have understated real growth in population as non-Bafokeng areas were not covered.

This study was carried out in three phases: a desk-top analysis completed in November 2013 that compared the 2001 and 2011 census findings; a house-to-house survey in the 29 Royal Bafokeng villages completed in June 2014; and a similar survey in the Freedom Park formal and informal settlements completed in September 2014.

Using the census data for 2001 to 2011, the main indicators analysed were basic demographics, access to basic services, educational levels, employment and income, and future shaft closures and the opening of new ones. The study also assisted in identifying the number of Impala mine workers who may be living in vulnerable conditions.

The study confirmed the benefits of mining by way of job creation, economic activity and community investment made by mining companies. However, this invariably acts as a drawcard for in-migration.

The following is a summary of some of the key findings of the study

General population

• Overall the population in the surveyed area has increased by 3.3% year-on-year between 2011 and 2014, mainly as a result of in-migration. This has been accompanied by a significant increase in population density, especially near the mine shafts.
• The in-migration of more males has resulted in an increase in the male-to-female ratio, as well as a significant increase in the economically active age population.
• In 2014, an estimated 22% of household heads were unemployed in the RBN villages and Freedom Park, which can be used as a proxy to estimate the level of unemployment. The higher levels of unemployment may be attributed to increased in-migration, as well as the fact that the census was conducted in the strike period.
• All of the villages near the Impala operation have shown an increase in the employed adult population. The only village that has shown a decline is Serutube.
• The proportion of formal housing has increased by 10%, informal dwellings have increased by 15% and backyard dwellings have decreased by 21%.
• Households with no sanitation declined by 11% from 14% in 2001 to 3% in 2011, while the number of households with flush toilets increased by 19% from 12.7% to 31.7%.
• The majority of households in the RBN have access to electricity for lighting, cooking and heating. Access to electricity has improved from 64.6% in 2001 to 84.4% in 2011.
• The population of Freedom Park has grown from approximately 6 000 in 2001 to close to 25 000 in 2014 – faster than other villages immediately surrounding the Impala operation. This is illustrative of in-migration.

Mining households

• There are approximately 50 000 people who work for mining companies and associated industry within the RBN and Freedom Park area.
• Within the RBN villages, approximately 40% (16 000) miners live in formal housing, 35% (14 000) are in back yards, 18% (7 000) in informal dwellings or shacks; in the Freedom Park area a larger percentage is in formal housing (5 000), mainly in Reconstruction and Development Programme (RDP) housing and villages. The balance can be found in informal settlements.
• Of the approximately 27 000 Impala employees identified, approximately 9 900 were found in Freedom Park, with 17 000 in RBN villages. Approximately 55% of the permanent employees in the RBN villages and Freedom Park live in formal housing, while the balance live in backyards and shacks.

Key interventions

Informed by the study, we have identified the following issues to be addressed as part of our socio-economic development strategy.

• Our housing strategy needs to further reduce the number of employees living in informal dwellings and shacks. Provision also needs to be made for the increase in demand for rental rather than owned accommodation. This study has informed the review of our housing strategy. (Refer to following link)
• The significant number of contractor employees living in informal accommodation and shacks needs to be addressed as part of our contractor management strategy as this poses a material risk to employees and to the business.
• The in-migration of women and children indicates a need to address social constraints regarding health and education, and to this end Impala has continued to invest in education and health. (Refer to following link)
• Addressing the various challenges will need to be done in collaboration with our social partners, the Royal Bafokeng Administration (RBA) and the Rustenburg local municipality. Refer (to following link)
• The possibility of additional research work in collaboration with an academic institution on this initial data gathered is to be explored, which will inform our socio-economic development strategies further.