Kumba

KUMBA IRON ORESUSTAINABLE DEVELOPMENT REPORT 2011

CASE STUDIES

CASE STUDY

Key performance indicator THE DINGLETON RESETTLEMENT: CHANGING FOR THE BETTER

The existing town of Dingleton, near Sishen mine.
The existing town of Dingleton, near Sishen mine.

Some 3,500 people in 684 households live in the town of Dingleton, which borders Sishen mine in the Northern Cape. There has been talk of resettling the residents here since the late 1980s. In 2007, Kumba began planning for this large-scale and complex resettlement process to finally go ahead.

The resettlement of Dingleton residents to the southeast of Kathu, some 30km away, became necessary for many reasons.


Pre-feasibility phase

The project’s pre-feasibility phase began in 2007, with the identification of potential impacts and affected parties, and the mobilisation of a resettlement committee.

An asset inventory of infrastructure and households – down to the number of fruit trees within a property – and a register of residents were drawn up. Information was also collected from each household about economic activities undertaken, incidences of disease or illness among household members, births and deaths, income and expenditure, material possessions and residents’ use of social infrastructure. The conceptual design of the new facilities was worked on and costs were estimated.

Key performance indicator Public involvement was paramount at all stages of the process and communication between all parties was essential to identify any areas of concern. The Resettlement Working Group (RWG) was formed, consisting of all primary stakeholders: six Dingleton residents representing the community, four representatives from the local Gamagara municipality, three members from the Northern Cape provincial government, two Kumba representatives and various consultants who were appointed in an advisory capacity. The RWG’s role was to investigate the feasibility of the resettlement, to produce a resettlement action plan (RAP) and to advise both Kumba and the Northern Cape government. A joint steering committee (JSC) was also formed, comprising representatives of local, district and provincial governments, the RWG and Kumba. The roles of the JSC included oversight, the provision of access to technical support and process facilitation.

All pre-feasibility study requirements have taken place, including a social impact baseline assessment, environmental impact assessment and an economic impact assessment, all of which will form part of the RAP.

International Finance Corporation Performance Standard adopted

Guiding the overall resettlement process from the beginning has been Kumba’s adherence to the Performance Standard 5: Land Acquisition and Involuntary Resettlement of the International Finance Corporation (IFC). This, in summary, advocates that resettled residents should enjoy equal or better circumstances than those they experienced before resettlement and that displaced persons are to be offered compensation for loss of assets at full replacement cost, as well as other assistance. With the average value of a house in Dingleton estimated at R150,000 and that of the average house in Kathu standing in excess of R1 million, resettled residents are set to gain a far more valuable asset. As an indication of the extent to which Kumba is taking its responsibilities towards Dingleton residents, allowances will be awarded for the reinstallation of household amenities and facilities.

Feasibility phase

The resettlement process is currently in the feasibility phase, with all related studies expected to be completed in June 2012, including detailed valuations of existing properties and structures and detailed designs of the new properties and structures in Kathu. This will be followed by a series of reviews and approvals, which is expected to take about six months, with final approval for the entire project expected in early 2013. A first draft of the RAP was prepared at the end of 2011, and covers all aspects of the resettlement in depth. The RAP will have to be approved by the community and local government. An accurate costing is currently taking place and early indications are that the entire project will cost more than R1 billion. Town planners have been consulted and the layout is currently awaiting the municipality’s approval.

An environmental management plan and a sustainable development plan (SDP) are being drawn up, which will also have to be approved by government. A non-governmental organisation is being appointed to independently monitor and evaluate the resettlement process and adherence to IFC guidelines.

Since September, financial advisers have been talking to residents to assist them with decision-making. This is not a straightforward process as residents are not necessarily exchanging like for like in terms of their homes. For example, older residents are being given the option to downscale, construct a smaller home for their own needs and build an adjoining ’granny flat’ to rent out to provide them with extra income. Once decisions are made, residents will sign formal agreements with the help of legal advisers.

Tenders are being obtained for the demolition of the old houses and infrastructure, for the erection of the new houses and other buildings and for moving the households of Dingleton to Kathu.

In addition to the regular RWG and JSC meetings, the Dingleton representatives on the RWG hold monthly meetings to give feedback to the community so they can see that their needs are being addressed. Kumba, the Dingleton representatives and the community also meet twice a month.

Execution phase

During the execution phase, the RAP will be updated and compensation for all affected persons finalised. Contractors will be appointed to undertake the construction work and the new houses and social structures will be erected. The SDP will be finalised and implemented, and a resettlement review and audit will take place.

Willie Human, project manager, Kumba projects, says: “The vast majority of Dingleton residents are very excited about the move and actually can’t wait. There is a small percentage, say 2%, of the people that are not so keen. They tend to be elderly people who are more resistant to change and the upheaval associated with the move. They are particularly concerned about where they will keep chickens and other livestock, as the by-laws are different in Kathu. Kumba is looking into the possibility of addressing these types of concerns.”

The new houses to be built in Kathu will be easy to maintain while solar panels will make them eco-friendly. Willie says: “The former Dingleton residents will undoubtedly become part of the bigger picture of Kathu where there is a lot of expansion taking place. They will be able to enjoy the benefits of living in a developing municipal area rather than what has become a dusty backwater.”

The sustainable development plan: the future

The SDP for the Dingleton resettlement project is a forward-looking document and considers in detail life after the resettlement process from socio-economic, environmental and health perspectives.

Many initiatives are being proposed, including the recycling of materials from the demolished houses and other structures. There is a huge demand for low-income housing in the area and such items as second-hand door frames and bricks are valuable commodities. Also being considered is the way in which the many small local construction businesses being used for the project can be developed into bigger, more profitable businesses in the future. Rental accommodation in the area is also in demand and this too is being investigated. Various schemes are being proposed which will allow for some kind of subsidy to make the higher rates and taxes on the more valuable properties in Kathu more affordable for the resettled residents.

Anel Marais, manager, social and community development, Kumba, says: “The development will be as green and as cost-effective as possible.” To this end, fruit trees will be replaced and gardens will be designed in such a way that household water can be recycled back into gardens.

A learning curve

Asked what Kumba had learned from the resettlement process so far, Willie, who is completing his masters in project management and made the Dingleton resettlement the subject of his thesis, says a great deal. “Without doubt, the three pillars of a resettlement project are risk management, communications and stakeholder management. There is a crucial need to engage with all stakeholders at all times. If there is trust among stakeholders, your chances of project success are so much higher.” He adds, “There was a priest in one of the Dingleton churches who regularly said he didn’t trust what we were doing or our motives. He has finally changed his mind and told me the other day that he now trusts us. I was overjoyed.”

DINGLETON RESIDENTS’
RESETTLEMENT SURVEY

(%)
DINGLETON RESIDENTS’RESETTLEMENT SURVEY(%)