How SA plans to the tackle construction mafia

The construction industry in South Africa has been facing a significant challenge from what is commonly known as the 'construction mafia'. These are groups that extort money from contractors, subcontractors, and developers under the guise of meeting legislative requirements for local participation in public sector projects. The cost of this illegal activity has been estimated to be around R68 billion, a staggering figure that has prompted the government to take action. In a recent webinar, Minister of Public Works and Infrastructure, Minister Zikalala, met with industry experts to discuss the issue, highlight government initiatives, and explore industry strategies to tackle this problem. One of the key initiatives proposed by the government is the Public Procurement Bill, which aims to address issues related to participation percentages and ensure due diligence on companies involved in construction projects. Additionally, two specific initiatives have been introduced - a social facilitation unit to improve communication with local communities and a specialized organized crime detective services unit to investigate extortion and racketeering by these groups. However, the response from the industry has been lukewarm, with many businesses facing disruptions and challenges in dealing with the construction mafia. While some have resorted to legal action and cooperation with authorities, others have been forced to close down or pay the extortion fees to continue operations. The situation has led to protracted delays, financial losses, and a negative impact on the economy. Foreign companies have also felt the effects of the construction mafia, with some international contractors experiencing project interruptions and even withdrawing from contracts due to the challenges faced. For instance, the M2 bridge project, led by a German company in partnership with a local firm, was significantly impacted by the activities of these groups, resulting in their eventual withdrawal. In light of these challenges, the webinar revealed a consensus among industry professionals and government officials on the urgent need to address this issue collaboratively. The construction industry is a vital sector in South Africa, providing employment and economic opportunities to many citizens. By aligning legislation with industry needs, implementing effective measures, and fostering cooperation among stakeholders, the aim is to combat the construction mafia and ensure the industry's sustainability and growth. Overall, the discussion emphasized the importance of a collective effort to tackle the problem head-on and create a conducive environment for construction activities to thrive. With ongoing investigations and initiatives in place, the hope is to disrupt the operations of these illegal groups and safeguard the industry from further harm.