In a significant move to root out underperformance and malpractice, the Construction Industry Development Board (CIDB) has blacklisted 40 contractors from doing business with the Department of Public Works and Infrastructure and its entities.
The blacklisting, which covers the period from June 2024 to the present, has been welcomed by Public Works and Infrastructure Minister, Dean Macpherson. The Minister stated that this action sends a “clear signal that the department is serious about acting against non-performance.” He confirmed that the listed contractors are now prohibited from bidding for tenders or being awarded work by the department.
“This aligns with his vision of ensuring that the department is a professional and highly functional delivery unit,” a statement from the Minister read.
CIDB CEO, Bongani Dladla, elaborated on the decision, detailing the reasons behind the blacklisting and the processes involved. He confirmed that the board follows a strict, multi-layered process to ensure fairness and transparency.
“We strictly follow the CIDB act and our regulations,” Dladla stated. He explained that the process involves investigations, sometimes independent, into credible allegations. Contractors facing allegations are given an opportunity to respond through a prescribed administrative (PA) process. The final decision is not made by one individual but is taken through the executive committee, the board, and various board committees.
According to Dladla, the primary reasons for blacklisting include companies misrepresenting their credentials or financial capabilities to secure larger contracts.
“In many instances it’s where companies misrepresent their credentials,” he said, citing past projects or financial records. This often leads to project failures, including projects not completed on time or budgets exhausted before 80% of the work is done. The CIDB initiates investigations based on these failures, as well as tips from the public via a hotline and media reports on stalled projects.
A significant challenge highlighted in the discussion is the practice of blacklisted individuals re-entering the system under new company names. Dladla acknowledged this loophole, explaining that current regulations primarily target companies, not individual directors.
“Our current regulations regulate the conduct of companies,” Dladla said. He noted that while a blacklisted grade nine company would have to re-register as a grade one entity, its directors could potentially be involved. The CIDB is actively working to amend its regulations to more easily hold directors accountable for transgressions.
When asked about the impact on smaller contractors, Dladla emphasized a “zero tolerance” stance towards fraud and corruption, which he said causes “huge devastation to the South African economy” through stalled and incomplete projects. He clarified that the CIDB balances this accountability with a development program for genuine construction companies to help them grow legitimately.
Dladla also called for strengthened procurement processes from client departments and better partnerships with entities like the CIPC to flag suspicious companies and directors. He urged the public and officials to report any suspected foul play in construction procurement to prevent the cycle of failed projects.
