South African consulting engineers have expressed deep concern with the quality of capital-project planning within the public sector and have warned that the problem of budget overruns and poor service delivery could grow unless departments take active steps to recruit and retain a better cadre of technical professionals.

Addressing the media on Wednesday, Consulting Engineers South Africa (Cesa) president Zulch Lötter said that the governing party’s policy of “deployment” was undermining the career development of technical professionals within departments and at municipalities, and was also leading to poor project planning and delivery.

“We believe that at the crux of South Africa’s service delivery dilemma is the shortage of technical leadership in the public sector,” Lötter said, noting that the number of technical professionals had fallen from 5 500 to around 1 500 people over the past few years.

Cesa, which represents more than 460 consulting engineering practices, which collectively employ 21 200 people and report yearly fee income of around R17-billion, was particularly concerned with the quality of capital expenditure (capex) planning within the public sector.

The organisation said that the authorities could no longer abdicate their responsibility for proper infrastructure and capex planning, and said that it hoped that the National Planning Commission, headed by Minister Trevor Manuel would help ensure that a framework was put in place to deal with the problem. This framework should also draw lessons from the cooperative model deployed during the run up to the 2010 FIFA World Cup. But until the appropriate in-house skills have been developed, “planning experts will have to be contracted into various departments to assist”.

Cesa deputy president Naren Bhojaram argued that, owing to the current lack of technical capacity within government, even terms of references given to consulting engineers for the design of capital projects were being “poorly written”. Scope changes and overruns were, thus, not confined to the implementation of projects, but were increasingly also common at the design stage.

“Our member firms find that there are very, very poorly written terms of reference and, therefore, you either price [the uncertainty] in, or when you start doing the work, the prices are going to go up, because you have to define the scope as you go alone,” Bhojaram lamented, adding that there were similar problems at the implementation phase.

“Specifications at our level, and sometimes at contractor level, are deteriorating and that causes the problem,” he added.

With improved planning, Cesa was convinced that the capex associated with South Africa’s proposed R846-billion infrastructure programme could be far better contained. But it might still be worthwhile exploring new procurement models in the design and construction of capital projects, whereby the risks could be more evenly shared by the public and private partners.

ENGINEERING INTAKE

Cesa also argued that government had a key role to play in improving the construction-economy environment, which was showing signs of strain. Capacity utilisation rates within the sector had fallen from the peak period ahead of the 2010 FIFA World Cup to around 80%, tender pricing had become increasingly competitive, contract awards were declining and public sector capital budgets were remaining unspent.

Despite a rise in service delivery protests, underspending by departments and municipalities was recorded at more than R12-billion last year, reflecting inadequate procurement capacity within government.

Cesa also argued that a positive construction environment would be crucial for attracting new talent to the sector, as outlined in the draft New Growth Path (NGP) framework. In fact, the NGP sets an ambitious target of having 30 000 engineering graduates a year as from 2014, which would be a dramatic increase from the 2 500 graduates currently emerging from South African universities. Even if all graduate technicians and technologies were included, the current yearly figure was estimated at closer to 6 000.

For South Africa to raise that level to even 12 000 or 15 000 by 2014, Lötter argued that the conversion rate at tertiary institutions would have to rise from the current rate of around 40% to around 80%. But to achieve this, emphasis would need to be given to both improving the quality of technical educators, as well as sustaining the construction economy. He noted that studies showed a strong positive correlation between the percentage of gross fixed capital formation to gross domestic product and the intake of students into engineering.

“We also need infrastructure projects, because it’s no use having graduates joining our practices and all we can give them is the design of taps and toilets. That is not something that will attract young, bright students,” he concluded.