Construction Industry Development Board Annual Report

PUBLIC WORKS PORTFOLIO COMMITTEE
07 November 2007
CONSTRUCTION INDUSTRY DEVELOPMENT BOARD ANNUAL REPORT

Chairperson: Ms T Tobias (ANC)

Documents handed out:
Construction Industry Development Board of Annual Report 2006/07 Presentation
Construction Industry Development Board of Annual Report 2006/07

Audio recording of meeting

SUMMARY:
The Portfolio Committee on Public Works was briefed by the Construction Industry Development Board (CIDB). The briefing addresseed CIDB’s performance, effects of the 2010 FIFA world cup construction boom on the local construction industry, CIDB’s vacancy rate, how the grading process works, establishment of Construction Contract Centres (CCC’s) offices, the stakeholder forum register, linkages with the Department of Public Works, Board member appointments as well as contractors with lower grading among others.

Members raised questions on the number of staff and the vacancy rate, the communication tools being used, the recruitment programmes, and finance for contractors and the method by which this was obtained. Further questions related to the mandate and the financing.

MINUTES:
Construction Industry Development Board (CIDB) 2006/7 Annual Report Briefing
Mr Ronnie Khoza, Chief Executive Officer for CIDB briefed the Committee on key matters relating to the Construction Industry Development Board (CIDB). He noted that the CIDB was intended to provide strategic leadership to industry to promote reform and development, and regulate the construction industry. The presentation highlighted CIDB’s performance, effects of the 2010 FIFA world cup construction boom on the local construction industry, CIDB’s vacancy rate, how the grading process worked, establishment of Construction Contract Centres (CCC’s) offices, the launch of the Construction Charter, stakeholder forum register, linkages with the Department of Public Works, and Board member appointments. The main challenges were identified as the rapid growth of the registrar of contractors, which had led to backlog, and the need for further resources and systems to keep pace....The financial indicators were the increase of revenue by 19% to R40,01 million from government, and 142% in revenue from the registers. The expenditure had increased by 33%. Detailed figures were provided. The surplus for the year was R5.5 million, that was to be used in the next year's budget for the set up of CCCs. There had been one qualification in the audit report, that related to incorrect debiting or crediting on contractor accounts. The matter was being addressed through reconciliation processes..  

Discussion:
Ms C Ramotsamai (ANC) asked how many staff members there were n 2006 and how many there were currently. Ms Ramotsamai also asked how this had affected their output.

Mr  Khoza  noted that in 2001 when CIDB started there was a total of 42 staff members permanently employed and that currently there were 100 permanent staff members employed. Mr Khoza raised the problem of finding suitable employees as most of the vacancies were highly specialised areas and noted that temporary employees were riskier as they were more susceptible to bribery in this kind of industry. There had been a bigger output since the employment of more personnel.

Ms Ramotsamai requested that CIDB highlight which communications tools were being used by the CIDB.

Mr Khoza pointed out the establishment of call centres as a tool of communications was used by the CIDB,  adding that employment opportunities were thus created . The establishment of these helped also improve the efficiency of CIDB.

Mr S Nxumalo (ANC) wanted to know the vacancy rate at the CIDB. Mr Nxumalo went on to ask if all the board members’ terms had expired.

Mr Khoza replied that it was the duty of the Minister of Public Works to appoint board members and that no standard approach was used by the Minister to appoint the board.
 
Mr Khoza indicated that the CIDB were currently sitting with 100 permanent employees as compared with the 112 target. He mentioned also that they had a recruitment programme to help fill the vacancies at CIDB as well as a reliable team of consultants groomed by the CIDB.
Ms N Ngcengwane (ANC) enquired on the access to finance for contractors and if it was still a problem for most of the emerging contractors. Ms Ngcengwane was concerned about those contractors being registered with the Credit Bureau.

Mr Khoza answered that the CIDB had been in touch with the major banks in the country who  had responded by establishing packages that would offer financial assistance to contractors who needed some financial backing.

Mr J Blanche (DA) asked if the 51 000 contractors registered under CIDB were competent and how they were screened. He also asked if there was enough manpower to handle this overload.

Mr Khoza replied that CIDB had established some incentives for their employees, such as that an employee’s wages would be increased proportional to their increment on processing registrations successfully.

The Chairperson wanted to know how CIDB acquired R5 million surplus after having still received addition funding from government. 

Mr L Maduma (ANC) asked how CIDB trained their clients.

Mr Khoza replied that the mandate of the CIDB was to lead and assist, only not to train, insisting also that CIDB played a dual role, having both the oversight over regulatory functions (for compliance) and by providing the required framework for development.

The meeting was adjourned.