1. 2018 Mine Health and Safety Summit
The Lakes Hotel and Conference Centre
19 October 2018
NEW LEVY MODEL
Mr. Karabo Mkwanazi - MHSC Chief Financial Officer

2. Presentation Outline Introduction
Current Levy Model vs 2014 Summit Milestones
Rational for Reviewing Levy Model
New Levy Model
Levy Model Rebates
Way Forward 2

3. 1. Introduction
The Mine Health and Safety Council (MHSC) funds its research activities with levies collected from mines.
Levies are payables in terms of regulation 4(1) of the Regulations relating to the Payment of Levies by Mines on the basis of Health and Safety Risk, published under Government Notice 846 in Government Gazette of 18 August 2006 (the “Regulation”).
The Regulation should be read with section 98(1)(zJ) of the Mine Health and Safety Act,1996 (Act 29 of 1996,as amended) (The MHSA). 3

4. STATE, SURPLUS AND INTEREST
1. Introduction…cont
Audited Revenue for the year ended 31 March 2018
70%
LEVIES
R79 million
27%
STATE, SURPLUS AND INTEREST
R30 million 3%
ADMIN FINES
R3 million
R130,5M 4

5. >R.5 billion 894 94% 492 73% 1. Introduction…cont MHSC COUNCIL 88
MHSC expenditure on research and promotion of health and safety in the SAMI
Reduction in Fatalities
2020
2017 88
1996
457
The Journey to Zero Harm So Far…
Tripartite Approach - 21yrs
MHSC
COUNCIL
State
Organised Labour
Employers
No of Mines Paying Levies
894
Based on levied in 2017/18 FY
Number of Research/ Projects Completed
492
Right to refuse dangerous Work
PPE for WIM
Research Expenditure
73%
Estimated expenditure based on ABC
Revenue Collection
94%
Collection of Levies from the mines.
The Journey So far…
Based on levied in 2017/18 FY - 853 5

6. 1. Introduction…cont Research and Studies Completed No Thrust Area
Research/ Studies 1
Human Factors/Behavioural Safety 17 2
Falls of Ground (FOG)
169 3
Rockbursts 42 4
Explosions and Fires 36 5
Machinery and transport systems 58 6
Airborne pollutants 44 7
Physical hazards 12 8
Occupational Diseases 9
Special Projects 56
TOTAL
492

7. 2. Current Levy Model vs 2014 Summit Milestones
During the 2014 Summit, the stakeholder in the South African Mining Industry (SAMI) set a target of zero harm.
The current levy model is based on the number of fatal and reportable injuries over a 3-year rolling period and the average labour figures for the previous year.
Not aligned to the goal of zero harm
Not risk based, but more reactive in addressing the occupational health and safety issues.
No rewards for good Occupational Health and Safety (OHS) record. 7

8. 3. Rational for Reviewing the Levy Model
In order to continue with world-class OHS research intended to achieve Zero Harm, the current levy model needed to be reviewed.
As the industry strives toward zero harm, the number of accidents are expected to reduce to zero.
The current levy model is not sustainable
This presents a high risk of a below standard OHS research – and non-achievement of zero harm. 8

9. 4. New Levy Model Risk Based Commodity Risk
Principles of New Levy Model
Risk Based
Past Performance – MHSI Annual Report
Commodity Risk
High Risk Commodities – Higher Levy
Production & Employment Figures
Production – Safety
Employment - Health
Fixed & Variable
Components
Fixed – OHS – 90%
Variable – OHS – 10%
Rewards
Rebate – 10%
OH + S
fatalities during the levy period which will also change from 3 years to 1 year. 9

10. 4. New Levy Model…cont Consist of both Fixed and Variable elements
Details
Health
Safety
Total
Fixed
45%
90%
Variable 5%
10%
50%
100%
Evenly distributed between Health and Safety Risk 10

11. 10% TOTAL OHS LEVY REBATE 5. Levy Model Rebate
The mines will now be rewarded for good OHS practices
The Health rebate will be based on the achievement of 2014 Milestone target
The Safety rebate will be based on zero fatalities and serious injuries
TOTAL OHS LEVY REBATE
10%
Occupational Health - 5%
Safety – 5% 11

12. 6. Way Forward Continuous Engagement Awareness Workshops
Stakeholder
Awareness
Workshops
All provinces
Implementation
YE 2020 12

13. RETURN ON INVESTMENT (ROI)
ZERO HARM 0%
EVERY MINE WORKER RETURNING FROM WORK UNHARMED EVERYDAY
STRIVING FOR ZERO HARM

14. THANK YOU