Construction mafia creates crisis by derailing infrastructure projects

Industry bodies call for law enforcement to address the problem.
The industry awaits details of special units established by government to address economic sabotage, extortion and vandalism of infrastructure. Image: Nadine Hutton/Bloomberg

The so-called construction mafia has created a crisis by derailing infrastructure projects that are a key component of the South African government’s post Covid-19 pandemic economic reconstruction and recovery plan.

It has contributed to frequent criticism of the government’s planned R96 billion infrastructure expenditure programme for its slow to non-existent implementation.

Read: Government recommits to infrastructure investment to support economy

Bargaining Council for the Civil Engineering Industry (BCCEI) operations manager Lindie Fourie said the problem of intimidation, extortion and violence on construction sites has reached crisis levels and requires an urgent and collaborative response.

The task of rolling back the disruption of vital infrastructure projects now needs all stakeholders to be actively involved in supporting renewed police action against these increasingly brazen criminal elements, she said.

National African Federation for the Building Industry president Aubrey Tshalata said many infrastructure projects countrywide have been disrupted by the construction mafia and believes law enforcement must isolate the criminals from people who have legitimate concerns and issues they want addressed.

Clouding issues

“It clouds our own issues. We champion transformation, we champion BEE [black economic empowerment]. That is now clouded in criminality, gangsterism and all of that. We can’t afford that,” he said.

Tshalata added that law enforcement is necessary so that contract execution can be done legally and legitimate business associations with proper structures can champion the cause of small, medium and micro enterprises (SMMEs) and black business.

“It can’t continue like this. I have got people who say they are even scared of tendering because they win the tender but then they have another challenge,” he said.

“It’s getting out of hand, it’s becoming ridiculous. Something has got to be done and there is nothing else other than law enforcement.”

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Tshalata said one of his federation’s members was awarded a contract for training and about 50 members of the ‘construction mafia’ came and sat down and were to be trained on tender pricing, costing and estimating – but these people said “forget that” and demanded to be paid 30% of the value of the contract without doing any work for it.

The “30%” relates to the 30% SMME sub-contracting requirement in the Preferential Procurement Policy Framework Act (PPPFA).

Government’s plan

President Cyril Ramaphosa admitted in his State of the Nation Address in February that South Africa needs to confront the criminal gangs that invade construction sites and other business places to extort money from companies.

Ramaphosa said this requires a focused and coordinated response and government has therefore established specialised multi-disciplinary units to address economic sabotage, extortion at construction sites and vandalism of infrastructure.

“We will make resources available to recruit and train an additional 12 000 new police personnel to ensure that the SAPS [South African Police Service] urgently gets the capacity it needs,” he said.

Reaction

Tshalata said he is “very excited” about the plan to confront criminal gangs that invade construction sites, particularly as it has been discussed and embraced by everyone in the Public-Private Growth Initiative (PPGI), a sector-based collaboration between government and business.

Fourie said the BCCEI is also encouraged by Ramaphosa’s announcement of a special police unit to deal with the construction mafia but stressed that it will need all stakeholders to give active support if this effort is to be successful.

“The BCCEI has developed an action plan to address the challenges in the civil engineering industry and we are reaching out to other players to ensure our response is collaborative,” she said.

Fourie said key aspects of the plan include working with stakeholders to effectively prevent interference in projects, as well as reacting proactively to instances of interference.

“With government working hard on its economic reconstruction and recovery plan, the country cannot afford its investments in infrastructure to be hijacked by local mafias,” she said.

Fourie added that the delays and damage caused are stalling the government’s job creation efforts because infrastructure works are among the quickest ways to stimulate growth.

Government infrastructure projects all include a range of constructive transformation measures, which are dutifully applied by contractors who legally win these projects, she said.

SA Forum of Civil Engineering Contractors (Safcec) CEO Webster Mfebe told Moneyweb last month that South Africa had set an ambitious target in the National Development Plan (NDP) of fixed investment accounting for 30% of GDP by 2030, but that it is currently contributing 14% to GDP.

“There is no hope on the horizon that we will be able to achieve that level of investment because of the slow rollout of public infrastructure investment plans,” he said.

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Law enforcement cannot even safeguard their own police stations and firearms and they must do what????

Where the construction mafia uses weapons to intimidate, threaten and coerce businessmen and property owners, the BEE mafia simply uses the law.

Who has the moral authority to act against the construction mafia when the criminal justice system and the parliament protect and enable the plundering of the same companies via legalized plunder? The socialist government firstly plunders the capital structure of the business with BEE requirements, then it plunders the bottom line of that business with a myriad of taxes, to finance the overpaid and extractive salaries of cadres.

The construction mafia is merely joining the looting spree, that was started by parliament, by jumping the cue to plunder the daily operations of the construction company, before taxes. They have woken up to the fact that BEE will never come their way because they are not politically-connected cadres. Now, they are starting to BEE themselves. Which government, parliament, president, police force, or judge has the moral authority to act against the construction mafia?

This feeding frenzy by looters and criminals is the consequence of infringements of property rights by the legislature. If you open that door to “redistribution”, the criminality and plunder will get a life of their own, and plunder will become a way of life for all citizens. Eventually, the criminal political factions will even fight for the power to plunder each other!

The ANC’s BEE system, cadre deployment and patronage politics has created this construction Mafia problem.

How do you confront, identify and then even try and remove the “Construction Mafia” – when you have allowed them for a quarter of century, to infect nearly every aspect of the state, so much so that heirs to state owned criminal enterprises now exist.

It is one large family business.

Think about this the next time you hear the very common phrase – unplanned outages (sabotage – the gift that keeps on giving).

CR is making a lot of promises at the moment including a Police Protection Unit for The Construction Industry…whether he can deliver on this ( and other recent promises) remains to be seen. Actions speak louder than words,so time will tell!

Just pipe dreams. In eThekwini the Business Forums have formal status and make outrageous demands and stop work unchecked, often with the ward councillor in the forefront of the blatant extortion. No policeman will move against them. Also they are completely selfish, wanting only loot for themselves, the communities they are meant to represent are ignored.

A nation either protects property rights or violates property rights. There is no half-pregnant here.

The president and his cabinet members can say to the construction mafia, “listen, while we have legalized plunder for our personal benefit, we plead with you to stop the criminal behavior that benefits only yourself. Our own selfish actions already cause rampant unemployment and social decay, please don’t exacerbate the situation for your own benefit. I have used the law to plunder property rights and to turn myself into a BEE billionaire, please don’t break the law to enrich yourself now.”

It is clear that at this stage of the 29-year-old BEE experiment, the scheme is starting to consume itself as BEE companies fall victim to the construction mafia. People who violated property rights to empower themselves, now fall victim to people who violate property rights to empower themselves. This could not happen to a nicer bunch of socialists. Devine justice, some would say.

Bringing in the Chinese Contractors is ultimate goal and mafia problem becomes no more. What law reinforcing, they get paid by the same mafia.

Cyril’s presidency will be remembered for him highlighting everything that needs to be done following on from the terrible 9 wasted years under Zuma.

You know, the wasted years under Zuma where Cyril sat on the ANC’s NEC and was the vice president under him for the last 4 years.

Construction Mafia, Taxi Mafia, State Corruption Mafia, National Sports Mafia, BBEE Mafia … I’m beginning to think we are a Mafia run State.

I remember being the traffic along Koeberg Road Cape Town where newly laid paving stones in the centre island were simply being picked up and stacked in a wheelbarrow (no doubt also stolen) for resale while the midday traffic rolled on.

Sigh …

End of comments.

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