White Paper:

Creating an Enabling Environment for
Reconstruction, Growth and Development
in the Construction Industry

Acknowledgements

The Ministry and Department of Public Works wish to acknowledge the contributions of individuals and organisations to the process of finalising this White Paper. The process has been characterised by a unique engagement between the public and private sectors, a process that has been led and facilitated by the Inter-ministerial Task Team on Construction Industry Development. Participation in the Reference Group and Focus Groups has enabled contributions at a policy and at a practical level of various formations of government, industry, researchers, academics and constructors.

Thanks are extended to the Task Team for its evaluation of public comment and its advice, which informed the final drafting process. This appreciation acknowledges the significant work done by Secretariat members, Andrew Merrifield of CSIR and Sam Amod of Development Engineering Consultants, who prepared a draft analysis of comment to facilitate the Task Team's evaluation.

A special word of appreciation is extended to the drafting team, in particular Spencer Hodgson (DPW), Rodney Milford and Andrew Merrifield (CSIR), as well as to Nolulama Gwagwa, Sivi Gounden (DPW) and Mike Muller (DWAF) for their advice.

We also wish to acknowledge the inputs of the Inter-ministerial Committee and the Departments of Transport, Water Affairs, Housing and Constitutional Development, as well as of parliamentary structures. Any omission in the acknowledgement of the contribution of any individual or organisation is entirely inadvertent.

Contents

Foreword
Abbreviations

Chapter One: Introduction

1.1 The Policy Formulation Process
1.2 Task Team Evaluation of Comment on the Green Paper
1.3 Broad Consensus on the Way Ahead

Chapter Two: Construction Industry Development Policy

2.1 The Purpose of the White Paper
2.2 In the Context of Government's Mandate
2.3 Impediments to Industry Growth and Development
2.4 Aim and Vision
2.5 The Strategic Framework of Enabling Programmes
2.6 Government's Enabling Role
2.7 Institutional Development
2.8 Conclusion

Chapter Three: Developing a Stable Delivery Environment

3.1 Stimulating Demand and Counteracting Volatility
3.2 Towards a Stable Work Environment

Chapter Four: Enhancing Industry Performance

4.1 Work-Process Transformation
4.2 Procurement Strategies to Effect Best-Practice Standards

Chapter Five: Restructuring Industry Education, Training and Human-Resource Development

5.1 Problem Statement
5.2 Vision
5.3 Constraints
5.4 Principles
5.5 Key Interventions
5.6 Institutional Response

Chapter Six: Promoting New Industry Capacity and the Emerging Sector

6.1 Problem Statement
6.2 Vision
6.3 Constraints
6.4 Principles
6.5 Key Programme Approaches

Chapter Seven: Developing the Capacity and Role of the Public Service

7.1 Delivery to Target the Marginalised
7.2 Overcoming Regulatory Impediments to Industry Performance
7.3 Improving Public-Sector Capacity to Manage Delivery
7.4 Promoting Regional Co-operation

Chapter Eight: Institutional Arrangements

8.1 Principles
8.2 Government Responsibilities
8.3 Industry Responsibilities
8.4 Construction Industry Development Board (CIDB)
8.5 Emerging Contractor Development Programme (ECDP)
8.6 Establishing an Effective Monitoring and Evaluation System

Chapter Nine: The Way Forward

9.1 Essence of the Enabling Strategy
9.2 Inter-ministerial Committee
9.3 Task Team on Construction Industry Development
9.4 Conclusion

Foreword

South Africa is a large country. It boasts the vast open spaces of the platteland, long mountain ranges, a spiderweb of roads, railway lines and air routes. Some of our rivers flow into developed ports and harbours, cutting across land routes which link our cities, towns, villages and farming areas together. Impressive bridges span the most treacherous of these rivers.

Postcard portraits of our country frequently display two major images of our country. On the one hand is the impressive architecture of citiesÕ skylines, our national monuments and our recreational facilities. On the other hand, our rural areas starkly reflect a legacy of neglect and under-development. Sometimes scenes that reflect the poverty of vast areas of our country are even romanticized. Photos of rural women carrying wood and water on their heads, smiling for the cameras for a fleeting moment in the drudgery and hardship that is the real experience of many of our people.

The visual map of South Africa described here reflects the enormous contribution the construction industry as a whole has made over the decades: the workers and bricklayers, the architects and quantity surveyors, the financial institutions and local initiatives. But the visual map also highlights that there is much to be done. Underneath the success of the construction industry in South Africa are a number of features we would prefer were not there: an unstable and frequently insecure employment environment, jittery periods of financial assurance, an inbuilt bias towards urban centres of development, and an essentially erratic approach to integrating the construction industry with the vision and objectives of the RDP.

The construction industry - comprising both the building and civil engineering sections - performs an indispensable role in the economy of South Africa and increasingly of the region as a whole. The construction industry provides the infrastructure which is fundamental to the ongoing development of our country; its activities affect everyoneÕs lives in one way or the other. Right at the top of the list of GovernmentÕs development priorities is the provision of infrastructure in underdeveloped areas, designed to bring relief to people living there in the form of jobs, linkages to markets, assets that promote economic business development in an integrated and coherent fashion. Jobs, expanding business opportunities and the potential for increased investment for small, medium and emerging contractors and individuals are but some of the benefits that will flow from an expanded and motivated industry.

Since the initial debates leading up to the Green Paper, and in the period following its publication, hundreds of people from all formations of industry have contributed to the refinement of Government policy, which is now crystallised in this White Paper. This dynamic engagement has also changed the mindsets of many.

In moving the process from the draft proposals of the Green Paper to the policy projected in this document and indeed, into implementation, the Inter-ministerial Task Team on Construction Industry Development has significantly contributed to the national strategy.

Drawn from industry and government, and supported by a Public Works Secretariat, the Task Team has engaged intensively in consultation with industry stakeholders. The Task Team subjected industry comment and feedback on the Green Paper to thorough analysis, and its recommendations have been incorporated in the final drafting process.

The White Paper is thus the refined result of a broad public policy making process and represents a significant milestone in the development of the South African construction industry. It provides an enabling framework within which the construction industry can play a more strategic role in social development and economic growth.
In the final drafting process, the Task Team, the Department of Public Works and the Inter-ministerial Committee have endeavoured to ensure that the construction industry development policy put forward in this White Paper reflects the deepest concerns of the industry as a whole. However, it is clearly not always possible to satisfy the diverse interests and often-conflicting views of different role players. At the end of the day Government policy must be formulated in the national interest.

This White Paper is about change. It is about the actions needed to stimulate change, to promote increased participation of the emerging sector, improved labour relations and sustainable employment. It is about appropriate human resource development and improved industry and client performance. And it is about establishing the institutional arrangements best suited to create a climate in which our industry can adapt rapidly to the accelerating changes impelled by globalisation.

Above all, this White Paper is about the South African people, who are the ultimate beneficiaries of the industry's output. It is they who are the real stakeholders in our construction industry, and it is their interest in a vibrant, efficient and effective industry that this national development strategy must serve.

Elements of the strategy are already in place and progress has been made on a number of fronts. In this regard. I am greatly encouraged by the level of industry cooperation that has been established by the Inter-ministerial Task Team. The vision and the strategy we have consolidated together provide merely a guide to action: the Task Team has breathed life and urgency into the process and has established a culture of "development through partnership" and a platform for ongoing implementation.

The envisaged Construction Industry Development Board (CIDB) will continue to build on this platform and will drive the national strategy for industry development on behalf of all stakeholders. In pursuit of the vision, it will introduce measures that support improved quality, productivity, safety, health and environmental protection. Within the ambit of construction activity, the CIDB will promote accelerated delivery, empowerment, efficiency and good governance throughout South Africa.

Let us now all take advantage of the vision and strategy contained in the White Paper. I honestly believe that the construction industry and its related components can move forward with confidence into the millennium. The industry has the full support of Government and we will continue to treasure the special relationship that the industry has contributed to the development of our people and our new democracy.

JEFF RADEBE, MP
Minister of Public Works

Abbreviations

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