Public Works Minister Thulas Nxesi has promised to deal with the issue of late payment of contractors, as well as to kick-start a process to draft payment legislation for the construction industry.

The Minister outlined the payment issue as a top priority during a briefing held to outline changes to the criteria for grading contractors on the Construction Industry Development Board (CIDB) register.

The register of contractors is established to manage risk on behalf of public-sector clients when procuring services from private-sector contractors by categorising and grading them according to their ability to carry out construction projects.

There are more than 100 000 contractors on the CIDB register.

Speaking at a stakeholders forum, Nxesi, CIDB chairperson Nonkululelo Sindane and CIDB acting CEO Ebrahim Moola agreed that the criteria needed to be tightened and that more criteria should be added.

Nxesi suggested that the CIDB establish regional committees with both industry representatives from the private sector and government officials to monitor business practices around construction sites at an on-the-ground level.

On the part of government, Nxesi said the Department of Public Works would prioritise funds towards upgrading and maintaining public-sector buildings and facilities, since most government buildings were old and often neglected in terms of day-to-day maintenance.

The Minister added that government was more attentive to pricing when awarding contracts for its infrastructure. He said procurement officials took care to assess pricing accordingly and realistically, as “the contractor with the cheapest tender is not necessarily the one that is going to be able to complete the job”.

On the other hand, contractors had also taken advantage of government, claiming unreasonably high amounts of money, and Nxesi assured the public and stakeholders that the department was zeroing in on pricing and understanding where government money was going.

Meanwhile, Sindane said the operations of the CIDB needed to become more streamlined to ensure efficiency, since it reached less than 40% of its performance targets for 2017/18 and, therefore, a new board of only 30 members had been appointed effective January this year. The CIDB was also in the process of recruiting a permanent CEO.

The CIDB planned on systematically improving the performance of the organisation to an achievement level of above 80% of its performance targets, mainly through enhanced monitoring of activities and strong leadership.

The criteria improvement on the register of contractors would include downgrading – to address the practice of higher grades tendering for and being awarded projects for work at lower grades, while lower-graded contractors could not tender for work at the higher grades.

In terms of the transfer of records, the CIDB would tighten certain regulations related to contractors providing documentation that was not in the name of the applicant contractors; for example, where a company had changed form or had been restructured.

The CIDB would consider the introduction of Grade 1 entry requirements for contractors, since anyone, at the moment, could register as an entry-level contactor.

The organisation would also assess mandatory registration of subcontractors and joint venture requirements, while assessing registration categories for trade contractors.

Moola stated that the CIDB would try to review and adjust tender value limits at least once every three years.

The CIDB had also taken note of concerns raised by contractors that corrupt contractors should be deregistered and directors blacklisted, since corruption was a major problem in the construction industry.