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SA’s consulting engineers concerned about little action on fraud and corruption

Consulting Engineers South Africa says that unrealistic tendering fees remain a concern for its members, while the extended time it takes in which to finalise a proposal is affecting profitability in the industry. In addition to this some consulting engineering companies argues that the quality of technical personnel they deal with has deteriorated, putting greater risk on the built environment sector.

Fraud and corruption is affecting the ethos of South African society, with a lot of talk and little action accompanying the growing evidence of corruption. CESA established an R1 million anticorruption fund to pro-actively prevent tendering irregularities experienced by its members. Here the members of CESA are required to raise any observed tender irregularities, especially at the tender specifications as advertised, to CESA which immediately contacts the concerned client to influence withdrawal of the tender, rectify the irregularity and re-advertise.

CESA’s CEO, Lefadi Makibinyane, believes that “prevention is better than cure”. CESA as a trusted advisor understands that it also has to be a trusted partner to its clients, with clear recognition that infrastructure delivery cannot be further delayed by issues of tender irregularities that are fought at courts on protracted litigation suites. CESA is also engaging with National Treasury to include the concept of an integrity pact into the Public Finance Management Act and the Municipal Finance Management Act.

Unlocking greater private sector participation is seen as a critical element to fast track delivery which will support engineering fees and as such engineering development in the industry. Private sector participation in this context refers to involvement on a more technical level (and not as a client), to improve municipal capacity and efficiency.

Service delivery, especially at municipal level remains a critical burning issue. The consulting engineering industry is threatened by incapacitated local and provincial governments. Public sector and these two tiers of government in particular, as major clients to the consulting engineering industry, are called upon to become more effective, more proactive in identifying needs and priorities and more efficient in project implementation and management. Pravin Gordhan made it very clear that under spending of infrastructure budgets is a serious concern for the industry, where only R177 billion of the R266 billion was spent during 2010/11.

The involvement of non-CESA members in government tenders and procurement continues to threaten the standard and performance of the industry. Non-CESA members do not seem to comply with the same standards and principles as those firms that are members of CESA. Firms from across South African borders are tendering at rates that are not competitive for local firms. Complaints have been received of some of these firms not producing proper drawings and not attending site visits. Clients need to be more vigilant to request a high standard in-line with what CESA advocates as a self-regulator of the consulting engineering services, to ensure that proper procurement processes are followed to eliminate the risk of awarding contracts to unscrupulous firms. While these occurrences may be limited to smaller rural areas, it remains an unacceptable practice. Clients can be assured of the quality of service through the appointment of consulting engineering firms that are members of CESA because it promotes the highest level of professional conduct, adherence to highest quality management standard, ethical conduct and management integrity amongst its members, ensuring that the client receives the best solution measured against cost and quality.

Lack of attention to the maintenance of infrastructure poses a serious problem for the industry. Not only is it much more costly to build new infrastructure, but dilapidated infrastructure hampers economic growth potential. The cost of resurfacing a road after seven years at current prices, is estimated at R175,000 per kilometre, compared to R3 million per kilometre to rebuild, less than 6% of the construction price. In many cases, infrastructure is left to deteriorate to such a state, that maintenance becomes almost impossible.

A further challenge to the industry is to find a way to standardise the procurement procedures applied by the different government departments. Procurement procedures should be standard for the country, or at least for the specific tier of government. “We are however encouraged by the good work by the CIDDB in formulating the procurement standards within the construction industry which will also cover the work of built environment professionals,” Makibinyane concludes.

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