SMME Contractors Step Up As Big Construction Companies Collapse

SMME Contractors Step Up As Big Construction Companies Collapse

By Janine Espin, Managing Director at Economic Development Solutions

The ground has shifted significantly under big construction players as market dynamics change and small and medium-sized (SMME) contractors step up to contribute more to the sector. These SMMEs represent the future of the industry. As sector interests converge, interesting new SMME development models are emerging.

SMME development in the construction sector is vital, not just to ensure Broad-Based Black Economic Empowerment (B-BBEE) requirements are met, but to help grow the construction industry. As large contractors continue to restructure, retrenched workers are looking for alternatives and so are construction clients. While the opportunities for SMME contractors are growing, their lack of business and management skills confound their ability to grow.

To help develop these companies and create a solid base of skills in the market to grow the sector, a deeper understanding of SMMEs shortcomings—and how they can be addressed—is required.

Challenges for SMMEs

Construction sector SMMEs typically specialise in focussing on civils, electrical or concrete work, steelwork or glazing, for example. Their turnovers can reach up to R50 million and they may employ anything from 100-200 people. With a strong appetite for work, these companies are more flexible in their approach to pricing, scope of work and willingness to employ local workers.

These characteristics make them attractive to contract winners looking to subcontract key aspects of a build, especially where local input quotas are required. However, to qualify for these opportunities, SMMEs must be able to demonstrate accountability—be able to deliver on time and budget, prove they have the skills and qualifications to complete the project, and comply with labour laws and other legislation. Many SMMEs with grassroots origins are not yet able to operate at this level.

With Preferential Procurement and Supplier Development making up 34 of the total 123 B-BBEE points for large enterprises (as per the Amended Construction Sector Code) it is imperative that SMME development strategies be put in place. But to be successful these investments need to be accurately targeted.

From the SMME’s perspective, some of the biggest challenges are knowing where and how to find work, how to bid, how to negotiate contracts, how to comply (with HR and labour laws, B-BBEE requirements, financial reporting), and how to plan and manage projects to meet deadlines and avoid penalties.

Innovative SMME development solutions

One client, a large roadworks company is running a 12-month construction incubator in collaboration with the Department of Roads. EDS worked with the Department of Roads and Transport to identify 36 SMME companies to receive technical road building training from the Department of Roads. The training ensures standards are met in roadworks projects. The construction company sponsors this training. Over the 12-month incubation period, the SMMEs also receive training in basic business skills from the Department of Trade and Industry (DTI’s) Small Enterprise Development Agency (Seda). EDS monitors and reports on all these efforts against the company’s B-BBEE requirements.

The benefits for all players are significant—the country’s skills pool grows, the SMMEs gain skills and jobs, and the sponsoring company can access a pool of trained and certified skills to deliver on its contracts.

In another project, EDS is working with the DTI and a client company. The DTI has committed to match the funding of the client company to ensure a sustainable training model is established.

These are just two of a cluster of SMME projects that EDS is involved in. For our clients in the renewable energy sector, we are working on a number of SMME development projects in rural areas. In addition to Seda business coaching, we provide ongoing mentorship, engaging with SMMEs on a regular basis to help them get set up on government databases, identify projects in their areas, and help them maximise their potential.

Start now – collaborate

As public, private and industry needs to converge, it is becoming easier to create innovative SMME development solutions. The winners will be those companies that band together to drive progress and change.

ACHASM 2019 Construction Health and Safety (H&S) Summit – October

ACHASM 2019 Construction Health and Safety (H&S) Summit – October

The Association of Construction Health and Safety Management (ACHASM) has announced that its 2019 Construction Health and Safety (H&S) Summit will be held at the Westville Country Club in Durban from 2 – 3 October 2019.

The first ACHASM symposium /was staged in 2011 with the objective of providing a forum for construction industry role players to address construction H&S related matters with specific emphasis on topical issues, the development of knowledge and skills areas, and to debate challenging issues.

The summit will be of relevance to architects, construction managers, construction project managers, Construction H&S Agents / Managers / Officers, contractors, engineers, inspectors, interior designers, landscape architects, quantity surveyors, and all interested construction role players.

Theme

The Fourth Industrial Revolution (FIR), also known as Industry 4.0, is a collective term for technologies and value chain organisation, which draw together cyber-physical systems, the Internet of Things (IoT) and the Internet of Services (IoS), together with other emerging technologies such as cloud technology, big data, predictive analysis, artificial intelligence, augmented reality, agile and collaborative robots, and additive manufacturing. Given the emergence of Industry 4.0, and the persistence of H&S problems, the theme for the 2019 Summit will be ‘The role of Industry 4.0 in Construction H&S’.

Programme

Day 1 will feature presentations addressing, among other: building information modelling (BIM); construction planning and H&S; H&S training; hazard identification and risk assessment (HIRA); medical surveillance; monitoring construction within the context of H&S; overview of the potential of Industry 4.0 in H&S; SACPCMP update; SMEs / subcontractors and H&S, and support work and formwork.

Day 2 will feature workshops, and discussion sessions.

Master Builders South Africa (MBSA); Continuing Professional Development (CPD); The Association of South African Quantity Surveyors (ASAQS); the South African Council for the Project and Construction Management Professions (SACPCMP); and the South African Institute of Occupational Safety and Health (Saiosh) will recognise the summit.

Exhibition stands and sponsorship opportunities are available.

For more information and to register visit www.achasm.co.za or contact Jackie Fort:

Mobile No.: +27 76 263 0549; E-mail: info@achasm.co.za

Master Builders South Africa Welcome Minister De Lille’s Investigation Into Late & Non-Payment Of Contractors

Master Builders South Africa Welcome Minister De Lille’s Investigation Into Late & Non-Payment Of Contractors

Contractors in the building industry have welcomed the newly-appointed Minister of Public Works and Infrastructure, Patricia De Lille’s launch of an investigation into the failure by the department to pay them within the stipulated maximum period of 30 days. Welcoming the announcement, the President of Master Builders South Africa, John Matthews said the Federation was pleased to see the Minister actively involved in finding solutions to the struggling sector.

Minister of Public Works and Infrastructure, Patricia De Lille
Image: David Ritchie/African News Agency/ANA

The Buck Stops With Us

The statement issued by Minister De Lille confirms that she has launched a full-scale investigation into the failure of the department to pay its service providers within 30 days:

As of the 22nd of July, the department had 2085 invoices which have not been paid within the stipulated 30-day period.

Facilities Management accounts for around 80% of invoices older than 30 days.

This relates to day-to-day, unplanned maintenance carried out on department buildings.

A Works Control System (WCS) is used for managing projects.

It deals with major construction projects and includes both contractors and consultants.

This, coupled with day-to-day maintenance are the core of the department and, together, they constitute 94% of the unpaid invoices that have gone beyond 30 days.

Other default areas pertain to telecommunications service providers and car rental agencies.

Several reasons, including processes being done outside of Supply Chain Management, issues with verification and certification of work done as well as late submissions of quotations have been given for these delays.

But it’s simply not good enough.

The minister believes this is unacceptable, particularly at a time when the economy needs strengthening and job creation is key.

In his reply to the State of the Nation Address debate in February 2018, President Cyril Ramaphosa sent out a stern warning to departments.

He stressed that the “frustration that these entrepreneurs have to endure at the hands of the very state that is supposed to assist them is a matter of great concern” and that the failure “to pay suppliers within 30 days has a devastating impact on small and medium-sized businesses.”

Minister De Lille is thus also in the process of implementing a Contract Management System, together with a Consequence Management System to keep track of payments and warns that there will be consequences for individuals who fail to comply with what is a legal requirement.

De Lille says: “The President has called on us to serve. So, we need to serve for public good and, by extension, fix South Africa.”

The buck stops with us. We need to return to the Batho Pele principles.”

Special Training For Concrete Work In Winter

Special Training For Concrete Work In Winter

Icy weather’s effects on concrete is covered in detail in The Concrete Institute’s SCT30 “Concrete Technology” training – an intensive five-day course that deals with, among many other subjects, the special techniques required for cold weather concreting.

John Roxburgh, senior lecturer at TCI’s School of Concrete Technology, says special techniques required for winter concreting include optimising the mix design, methods of heating up the concrete, thermal curing and the use of concrete maturity measurements.

Dealing with extreme temperature is fundamental to good concrete practice on site. Cold weather concreting is often defined as the placing of concrete at temperatures below 50C and in the South African there are many areas that will have ambient temperatures around or below 50C – especially early in the mornings, late afternoons and evenings.”

John Roxburgh, senior lecturer at the School of Concrete Technology

Roxburgh says in cold weather several potential problems may occur:

  • The binder will hydrate at a slower rate leading to concrete taking longer to set and gain strength which has the knock-on effect of longer bleed times and difficulties in finishing, as well as later stripping times;
  • There is also a chance of the concrete freezing with the associated damaged caused by the expansion of ice within the concrete.
  • Thermal cracking in mass pours may also be harder to prevent with high temperature differentials between the hotter core concrete and the outer concrete in contact with the low external ambient temperatures.

However, there are some basic and simple steps to take for concrete work in cold weather. The first is to always try and cast the concrete on a rising thermometer: rather cast in the early morning with the ambient temperature increasing as this would give the concrete more time to gain strength before it potentially freezes. Try and use slightly ‘richer’ mixes by either adding more cement to the mix or reducing the extender content in the cement. The use wooden formwork to help insulate the concrete or placing industrial insulating blankets and mats over the concrete will also help. The concreting works could also be done in a tent.

Concrete pour at sunset:
Casting concrete early in the morning in winter gives the concrete more time to gain strength before it potentially freezes, says John Roxburgh, senior lecturer at the School of Concrete Technology.

All these measures are reasonably easy to implement and will help tremendously in protecting concrete but there are more sophisticated and integral techniques that can be used in cold weather concreting to prevent costly setbacks – and these are covered in the SCT30 course offered by the School of Concrete Technology,” Roxburgh adds.

The TCI School is the oldest and largest provider of concrete technology education in South Africa and has a wide range of courses that cater for all levels of competency.

For more details about the SCT30 course as well as all the other 2019 courses planned in Midrand, Cape Town and Durban by the School of Concrete Technology this year, phone 011 315 0300 or email sct@theconcreteinstitute.org.za or visit www.theconcreteinstitute.org.za.

OHS Seminar in Midrand on 21 August 2019 

OHS Seminar in Midrand on 21 August 2019

Master Builders Association North (MBA North) in collaboration with The Institute for Work at Height (IWH)The South African Forum of Civil Engineering Contractors (SAFCEC) and Black Business Council in the Built Environment (BBCBE) are hosting a special OHS Seminar in Midrand on 21 August 2019 to address these burning issues.

To register for the Seminar, kindly contact Ms. Mbuya Ramabulana mbuya@mbanorth.co.za / 011 805 6611. 

Innovation In Cement Production Crucial To Environmental Sustainability

Innovation In Cement Production Crucial To Environmental Sustainability

In this exclusive article SA Builder delves into sustainability in cement production:

AfriSam’s value of ‘Planet’ is defined as a responsibility for the impact of its actions on the community and the environment

AfriSam’s Dudfield cement plant near Lichtenburg in the North-West province has its roots dating back to 1949 and remains a vital pillar in South Africa’s construction sector.

Vishal Aniruth, general manager at AfriSam Dudfield, notes that the plant had seen a number of production upgrades over its life-time. As importantly, it had been at the leading edge of efforts to achieve environmental sustainability.

We were one of the first plants in the country to convert from old electrostatic precipitator technology in terms of air emissions control,” Aniruth said. “This involved the installation of bag-house filter technology for kiln emissions, and allowed us to achieve compliance with the latest emissions standards.”

The Dudfield facility began as a mining operation, exploiting the shallow calcrete deposit that covers the entire 3 608 hectare mining licence. Before the plant was built, the mined limestone was shipped to the company’s kilns in Roodepoort.

Today, the quarry is a split-bench operation that opens up about 15 hectares a year. It produces annually about two million tonnes of limestone and 120 000 tons of shale for the plant from the Spring Valley quarry, located 65 km away.

Aniruth highlighted that the latest computer-based modelling techniques are used for deposit optimisation. This ensures that the mine plan generates the required quality of material for the plant. He noted that there are 65 years of proven reserves at the quarry, with further reserves at AfriSam properties at Kalkfontein and on the neighbouring farm Bethlehem.

AfriSam’s Dudfield cement operation in the North West Province was commissioned in 1965

Long experience

The cement plant itself was commissioned in 1965, with one kiln with the capacity to produce 380 000 tonnes per year. Kiln 2 followed in 1972, with an annual production capacity upgraded over time to 780 000 tons. The plant grew further in 1977, when Kiln 3 was added, augmenting capacity by another 630 000 tonnes a year. In an important market-leading innovation in 1992, Dudfield installed the country’s first cement roller press to enhance the manufacturing process and improve grinding capacity.

Continuously aligning its production capacity with market demand, AfriSam Dudfield upgraded its Kiln 3 capacity in 2003 to over a million tonnes a year. The plant currently operates only the Kiln 3 production line – a four-stage configuration with in-line pre-calciner. The kiln features indirect firing with a multi-channel burner.

Fully integrated plants

Among the key elements of current plant operations at Dudfield are two coal mills and two cement mills. Coal mill 1, constructed in 1966 with production capacity of 11 tonnes an hour, feeds the pre-calciner burner. The other unit mills coal for the main burner, and was built in 1975 with a 16 ton per hour capacity. Cement mill 1, installed in 1966, has a 49 ton per hour capacity. The second cement mill is larger, giving it double the capacity at 98 tonnes an hour.

The cement output from Dudfield is delivered as road bulk, rail bulk and bagged cement. The plant’s in-house road bulk and weighbridge facility is used to load tankers. On the rail bulk operation, a large portion of the plant’s production is railed to AfriSam depots. Clinker is also supplied to AfriSam’s Roodepoort milling facility. The packing and palletising facility produces a bagged cement product for the market.

Dudfield is one of two fully integrated AfriSam cement plants in South Africa, which together can produce 4,5 million tons of cement. The second is the Ulco plant in the Northern Cape. The company’s third plant – with annual capacity of 1,2 million tons – is in Tanzania.

The cement output from Dudfield is delivered as road bulk, rail bulk and bagged cement

Environmental mission

Also addressing the media visit to Dudfield was Hannes Meyer, cementitious executive at AfriSam, who focused on the company’s commitment to environmental issues. He noted that the global cement industry was responsible for about 5% of the world’s greenhouse gases released into the atmosphere. The country was also a significant producer of CO2 emissions.

South Africa is one of the world’s largest and fastest-growing carbon emitters,” said Meyer. “We are in the global top ten of CO2 emitters, when measured per capita.”

As a result, the country had committed to reduce greenhouse gas emissions by 34% below its ‘business as usual’ levels by 2020. As cement manufacturing produces a high level of CO2, he said, AfriSam had been proactive since the 1990s in charting and implementing a path towards environmental sustainability.

Cutting emissions

The innovative step in 2006 to install a baghouse in Dudfield’s Kiln 2 line was part of a broader corporate strategy, built on the values of ‘people, planet and performance’. AfriSam’s value of ‘planet’ is defined as a responsibility for the impact of its actions on the community and the environment.

We were the first company to equip all our kilns with the latest bag filter technology,” he said. “As a company, we are committed to make a difference and to leave a legacy that is positive.”

These initiatives have reduced the company’s particulate emissions to less than a tenth of what they were in 2003. It has also brought emissions to below even the European standard of 30 mg/m3; local regulations require 50 mg/m3 or less.

In the year 2000 AfriSam introduced Project Green Cement to actively reduce its carbon footprint

CO2 programme

Overall, the progress achieved in controlling its plant emissions and making production facilities more energy efficient has had considerable impact on AfriSam’s environmental performance. Between 1990 and the present, its CO2 emissions per ton of cementitious material have been reduced by 35%.

The use of extenders in cement has been an important aspect of these efforts. In 2000, the company launched Project Green Cement – to increase the use of extenders like fly-ash and slag from other industries. This allows the reduced use of clinker – the main consumer of energy in the production process – while making more use of extenders.

We are probably South Africa’s leading company in our understanding and application of extenders in cement,” said Meyer. “This field holds considerable scope for creating more environmentally friendly cements. We are pleased that we have developed the technical expertise to do this.”

In 2009, AfriSam was the first in the industry to introduce a CO2 rating system. This indicates the carbon footprint of each of its cement products, relative to Ordinary Portland Cement (OPC). Indeed, the initiative has gone beyond cement manufacture. Even AfriSam’s other construction materials – aggregate and ready mix concrete – receive a carbon footprint rating. This may also be an industry first, argued Meyer.

Carbon tax

The carbon tax recently introduced in June 2019 will be another pressure for many South African CO2-producing sectors, but also brings opportunities, he said.

There are many good concepts that industry has developed to save energy and CO2 emissions, but the depressed economy has dampened their application,” he said. “Carbon tax revenues could be channelled into incentives that promote energy-saving innovation, with good effect. This would ease demand on Eskom’s grid, contribute toward the country’s Paris Agreement obligations, and make our industries more competitive.”

The company’s environmental efforts include the maintenance of a dedicated Nature Conservation Trust for the full rehabilitation of quarries and mining areas after the closure of operations. It also includes collaboration and support for important players in the conservation space such as the World Wildlife Trust and Cape Nature.

Make The Right Choice On Site

Make The Right Choice On Site

By Gareth Griffiths

“Goedkoop is duurkoop” The original pre-painted galvanized roofing on this upmarket Cape Town home (seen on the right) needed complete replacement after less than 10 years in service and was replaced progressively by the contractor from the left using by Clean COLORBOND steel.

In this advisory article, a well-known steel roofing material supplier points out that both what happens on site needs to be monitored to ensure the right grade of steel as specified is actually used.

There is an old South African saying ‘goedkoop is duurkoop’. As a company worldwide, we have found that substituting a high quality roofing material such as ZINCALUME® steel or a high quality pre-painted steel such as COLORBOND® steel with an alternative material is sometimes done in error at the last minute to reduce building costs, without the specifying team being aware of it. We strongly advise against this practice” says Arno Hanekom, Regional Manager Africa, for steel roofing multinational company, BlueScope.

Following the old adage that form follows function, it is also true that the selection of materials used should mirror the intended function of the building, including elements of sustainability such as long life.

Sustainability starts with the roof”, says Hanekom. “By this, we mean that what covers the building is crucial to life and operating performance of the structure; and also that the right material needs to be specified during the design phase of the that building”.

But what happens on the building site is of critical importance. Misguided decisions by project managers, contractors and even built environment professionals can result in substitution of high performance steel as specified by architects with cheaper low grade options. These affect both performance and service life negatively” he says.

Look for the branding on the reverse side of the product

According to Hanekom, quality steels such as the ZINCALUME and COLORBOND steel brands have a dot matrix branding on the reverse side which clearly distinguishes the product concerned. This makes it easy to spot during construction site inspections.

He warns that substitution with cheaper grades of steel roofing often leads to two things happening:

  1. Corrosion and breakdown of the metal substrate at an accelerated rate compared with the BlueScope product. The company’s steel brands have been found to deliver a service life of more than four times longer than conventional galvanised or pre-painted galvanized steels, even where the substituted product contains a higher base metal thickness of steel.
  2. Colour and thermal performance. Premature fading and loss of infra-red reflectance are two key areas steel roofing of today. “There is no substitute for the performance of our ZINCALUME and COLORBOND steels when it comes to both the appearance of and a cooler roof”, adds Hanekom.

Reputation on the line

Hanekom asks: “Look for the brand that identifies the long lasting guaranteed performance of genuine ZINCALUME steel and COLORBOND steel from BlueScope. Why risk your reputation when you can enjoy peace of mind by using genuine ZINCALUME steel or Clean COLORBOND steel?”

Proof is in the testing

The pictured samples were exposed at BlueScope’s Bellambi Point Australian test site for the same period of time under a severe environment. The galvanized steel (left) shows a severe loss of zinc coating and consequent red rusting of the steel substrate, while the ZINCALUME steel sample (right) is still in good condition.

… and in real life
BlueScope’s local South African office has a number of case histories where COLORBOND steel was used to completely replace pre-painted galvanised roofing that had severely corroded after just 3 years. Now, 10 years on, those COLORBOND steel roofs are still intact.

Rural Flavour Infuses MBA North Regional Safety Awards 2019

Rural Flavour Infuses MBA North Regional Safety Awards 2019

Stimela Crossing under construction by Belo & Kies Construction in Barberton, Mpumalanga

The broad geographic footprint of Master Builders Association North (MBA North), which incorporates not only Gauteng, but Mpumalanga, Limpopo, and North-West provinces, has for the first time attracted interesting and innovative entries for the Association’s Regional Safety Awards from outlying country areas and towns such as Vryburg, Barberton and Ermelo. Other towns visited included Rustenburg and Polokwane.

The event, which was staged in Midrand in July, was well attended by members of the Association, competition participants, MBA North office bearers, Past Presidents, VIPs from various industry bodies and sponsors.

In his welcoming address, Executive Director of MBA North, Mohau Mphomela acknowledged and welcomed all present, with a special welcome to MBA North President Musa Shangase, Past Presidents Eunice Forbes, Neil Duncan, Pieter Rüde, Lea Smith, Tony Riley and Jason Wilmot, as well as members of the Executive Committee.

He noted the enthusiasm projected by all participants throughout the duration of the Competition and congratulated all who had submitted entries and participated in the Regional Safety awards. “It is this level of professionalism and dedication to Health and Safety that makes this Award ceremony so important to the industry and to the South African construction sector as a whole,” he said.

MBA North Construction Health and Safety Manager, Gerhard Roets said in his address: “It has been most encouraging for us to welcome the new entries from outlying areas and we see this as an important permanent feature of our Regional Safety Awards.”

Gerhard Roets, MBA North Construction Health and Safety Manager

Roets elaborated on the Awards statistics and structure, noting that 66 entries had been received and 56 audits were successfully completed between 9 May and 27 June 2019.

The Lead Audit team was composed of MBA North Construction Health and Safety officers: Gerhard Roets, Michelle Kok and Manie Van As.

In announcing the winners in the various categories Roets named the winner of the Federated Employers Mutual (FEM) trophy in Category I for projects of over R750 million as WBHO Construction (Pty) Ltd for its River Creek Deloitte project. He noted that the project stood out with a zero disabling injury frequency rate: “For a project of this magnitude, this is quite impressive,” he said. “The contractor and sub-contractors all have a strong health and safety culture – from the top all the way down.” (For the full list of winners see Page 12).

Winners of the Federated Employers Mutual (FEM) trophy in Category I for projects of over R750 million: WBHO Construction (Pty) Ltd for its River Creek Deloitte project

Special Awards were also presented to the following:

  • Best Performing Client Agent of the Year: Danie Jansen van Vuuren from Cairnmead Industrial Consultants

  • Best Performing Construction Manager of the Year: Christiaan Fourie from WTJV

  • Best Performing Construction Supervisor of the Year: Jean Le Roux from WBHO Construction

  • Best Performing Health & Safety Manager of the Year: Mark John from WBHO Construction

  • Best Performing Health & Safety Officer of the year: Jacques Steyn from Belo & Kies Construction

  • Best Performing Health & Safety Representative of the Year: Siyanda Mathebula from WBHO

Keynote speaker, Chief Executive Officer of the Federated Employers Mutual Assurance Company (FEM), Ndivhuwo Manyonga, began her address by pointing out that in global terms some 2.8 million people died every year in work related accidents, of which the construction industry represented the highest rate of deaths.

Keynote speaker Chief Executive Officer of the Federated Employers Mutual Assurance Company, Ndivhuwo Manyonga, addresses participants, winners and guests

In South Africa” she said “we have 8 000 accidents annually in our sector. In 2018 63 of these were fatal motor accidents. In one instance alone 17 employees died on the spot in a head-on collision.” Manyonga noted that the average age of employees claim payouts by FEM is 30 years of age.

In closing, Musa Shangase, President of MBA North, gave thanks to all present for their attendance, especially competition participants and winners and to Ndivhuwo Manyonga, CEO of FEM) for her enlightening address, He also thanked the range of loyal MBA North sponsors who made the event possible, the MBA North Staff for hosting the Regional Safety Awards Ceremony and Ferdi Snyman for being the Master of Ceremonies.

River Creek Deloitte project currently under construction by WBHO – winner of Category I for projects of over R750 million

 

MBA North Winners by Category of the 2019 Regional Safety Competition

Category

Company 2019

A: Plant & Storage Yards

Probuild Construction (Pty) Ltd

B1: Allied Trades

PERI Formwork Scaffolding Engineering (Pty) Ltd Polokwane Branch

B2: Manufacturers

ER Signs & Safety Springs Workshop

C:

N/A

Category Range

Company : Project

D: R15m to R40m

Belo & Kies Construction (Pty) Ltd : Toyota Vryburg

E: R40m to R100m

Belo & Kies Construction (Pty) Ltd : Toyota Polokwane

F: R100m to R250m

WBHO Construction (Pty) Ltd : Steyn City High School Phase 2

G: R250m to R450m

WBHO Construction (Pty) Ltd : Pretoria Head & Neck

H: R450m to R750m

WBHO Construction (PTY) Ltd : Trilogy Collection

I: R750 plus

WBHO Construction (Pty) Ltd : River Creek Deloitte

Best Sub Contractor with Site Establishment

Malinga Scaffolding (Pty) Ltd : Safeways Mall

Best Sub Contractor without Site Establishment

MFS (Pty) Ltd : 144 Oxford Road

DREAMS AND REALITY

DREAMS AND REALITY

What could be better than a cheque handed over, on time, at the end of a completed contract? Possibly the prospect of work for the next few decades on a mega-billion rand project that would most definitely take its place in the history books – one way or another.

John Matthews, President, Master Builders South Africa

Both seemed to be possibilities from the very bullish State of the Nation address by President Ramaphosa late in June, when, together with his reference to the private sector’s commitment to invest R840 billion over the next five years, for a range of projects, he also said he dreamed of an entirely new city to meet the so-called fourth industrial revolution.

There is no doubt that a multi-billion rand injection from any source, has the potential to meet the promise of 155 000 new jobs he described, which will  have a spin-off for the building industry both in terms of capital and employment. But the dream of a massive new city, complete with skyscrapers, had many South Africans expressing reservations about its feasibility, in spite of the President’s strong motivation and some high-profile global precedents.

However, right now, one of the biggest stumbling blocks to the health of the building industry in South Africa (among the other industries servicing the private and public sector) is the less than prompt payment for work done. As I have discussed in earlier Comments, industry leaders are consistently addressing this difficulty at every corporate and government level, to the point where a discussion on the subject is on the cards with the President himself.

Because good and bad practices have a distinct knock-on effect – non-payment by clients both public and private to their primary contractors, means that the next level of service providers doesn’t get paid and the dominoes start to fall.

One can be encouraged by Mr Ramaphosa’s strongly-articulated intention to create an ethical government – which can only in practice imply that the State will, among others, meet its commitments to contracts with service providers, that include timeous payments for work done.

Another perennial preoccupation for the industry is Health and Safety, the major emphasis on which dates back to 1964, when regions first took part in a national competition and it was extended to two categories – Building and Allied Trades.

Today it remains one of the big events on our calendar and is competed in 10 different categories with up to 50 regional Association winners entered into the national competition. Independent auditors have just been appointed for this year and the list of all entries from the regions has been finalised. The outcomes will be interesting and vitally important to this aspect of our industry

We have much on our minds at the moment and notwithstanding the lofty dreams of our country’s leader, we remain in a state of uncertainty.

John

Construction Industry’s September Congress To Produce A Joint Action-Plan To Rescue And Revive The Sector – MBSA

Construction Industry’s September Congress To Produce A Joint Action-Plan To Rescue And Revive The Sector – MBSA

The construction industry will be convening at Emperors Palace in September to develop a joint action-plan on dealing with the challenges the sector has been facing. This follows the collapse of several large contractors in recent months, that has led to unprecedented job losses in the construction industry. President Ramaphosa is expected to address this gathering of the industry’s employer and professional associations, property owners, labour unions and community business forums.

Roy Mnisi, Executive Director of Master Builders South Africa

Plans for the joint action-plan follow the industry’s call for urgent intervention to the Presidency earlier in the year. Roy Mnisi, Executive Director of Master Builders South Africa spoke of the progress made since that industry call was made: “We are pleased to report that President Ramaphosa engaged us through the Departments of Public Works and Treasury on these issues, but progress in resolving these matters is remarkably slow. The issues of late and non-payment of contractors and the illegal work-stoppages on construction sites remain significant threats and we still have companies closing down and jobs being lost as a result. Its deeply concerning that in the first quarter of 2019 alone, the construction industry lost 142 000 (one hundred and forty-two thousand) jobs. This is the biggest loss of jobs compared to any other industry in the country.”

Regarding the purpose of the gathering, Mnisi said that “it can only be through continuous, genuine and pragmatic public-private sector dialogue that we can rescue and revive the sector. So, we will continue to knock on the door until the challenges are resolved and we have a strong and sustainable industry. That is the reason why this Congress has been convened.” The event is aptly themed ‘Building a Sustainable, Innovative and Transformed Construction Industry’ and will also include two panel discussions involving construction professionals, contractors, community business forums, the police and various government departments.

In his 2019 State of Nation Address, President Ramaphosa acknowledged the need for a ‘boost to the construction sector which has been in the doldrums for a while’ and committed R100 billion to seed an Infrastructure Fund to be managed by the Development Bank of Southern Africa and Department of Public Works and Infrastructure.

We expect this Congress to be the appropriate platform to come up with firm industry-resolutions on how this Fund will be immediately operationalised to save jobs and companies”, Mnisi concluded.