Department to intensify efforts to pay service providers on time

South Africa – Public Works and Infrastructure Minister Sihle Zikalala has vowed to put an end to the failure to pay service providers in the construction industry within 30 days .

Minister Zikalala was speaking at the National Stakeholder Forum convened by the Construction Industry Development Board (CIDB) which is an entity of the Department of Public Works and Infrastructure (DPWI) .

The National Stakeholder Forum is comprised of contractors in the built industry, government departments and municipalities involved in infrastructure development, built industry organisations and councils, institutions of higher learning and other key players in the built environment industry .

The forum was convened in order for the Minister to gain insight from players in the industry and go through emerging trends and developments, respond to threats and new opportunities emerging within the sector .

“We will commence engagements with all contractors not paid on time .

It is time that we fight bribery and corruption where payments are delayed in order to force them to pay .

We are alarmed at the allegations that outstanding invoices amount to billions .

 We will intensify the Re a Patala campaign in all provinces,” said the Minister .

Re Ya Patala (We Pay) was launched by the DPWI October 2009 as means to address payment backlogs to service providers .

Responding to challenges faced by small, micro and medium enterprises (SMMEs) and emerging contractors around access to finance, Zikalala noted the historic partnership between the CIDB and the Small Enterprise Finance Agency (SEFA) for construction industry financing mechanisms to focus on financing small and medium contractors and cooperatives involved in the construction sector .

The partnership under consideration will see the CIDB contribute up to R150 million and SEFA matching that with R150 million over the medium term .

“The struggle faced by SMME’s in the construction sector requires innovation .

Many collapse because they do not have access to finance and loans for building materials and other resources .

We need to develop a finance institution led by the industry to support contractors,” said the Minister .

Stakeholders have implored the Minister to investigate and report on the escalating rate of the cancellation of tenders, especially big tenders by parastatals and institutions which is costing the construction industry billions of rands .

The forum noted that big state entities cancel tenders after contractors have spent money and time putting together infrastructure .

Career paths
Meanwhile, the Minister raised concern over the slow pace in which the built environment industry is advancing the career path of professionals .

“The DPWI is worried that there are suspicions of gatekeeping .

At least over 30 000 professionals have been kept at the candidacy level for a longer period of time .

There seems to be no appetite to graduate them and empower them with skills relevant to their qualifications,” said the DPWI .

The department, through one of its entities, the Council for the Built Environment (CBE), will establish a national logbook to track progress in this area .

The entity has also been tasked with standardising the process of how one obtains professional recognition within the industry .

The CBE will strengthen its relationship with tertiary institutions and councils to accelerate the preparation, mentoring and registration of students at lower academic levels .

World News

TDPel Media

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