Timber iQ August - September 2019 // Issue:45 | Page 12

ASSOCIATIONS
Call for urgent gov intervention
to save SA construction
Master Builders South Africa (MBSA) is calling for urgent government
intervention to prevent further destruction of the construction industry
in the country.
By Master Builders South Africa
T
he call for intervention follows Group Five’s filing for bankruptcy protection
recently, the fifth major construction company to do so in less than a year.
Roy Mnisi, executive director of Master Builders expressed deep
concern on the matter. “This is the fifth large firm to succumb in less than a
year. In 2018 alone, NMC Construction went into voluntary liquidation
while Basil Read, Esor Construction and Liviero Group applied for
business rescue. We still have many other small to medium-sized firms
facing financial difficulties and yet, there has not been any
government-industry engagement to develop a plan to halt the trend.”
According to Mnisi, the industry has continually engaged government
on the adverse impact of late or non-payment of contractors for work
completed but the matter remains unresolved. “The decline has
reached a very concerning level, so much that it is no longer a sectoral
problem but a national crisis. We appeal to the government to open up
to the industry and urgently find concomitant solutions to save it from a
total collapse.”
However, he acknowledges that there are other factors instrumental
to the demise of the industry. These include a sluggish economy,
reduction in ‘actual’ infrastructure spending by the government, as well
as illegal and often violent work-stoppages at construction sites by various
illegal forums.
The adverse impact of these company closures are severe, he
notes. “The short-term effect is that direct employees of
these collapsed companies lose their jobs. When you
consider that the construction industry employs more than
11% of the workforce in South Africa, the negative
impact on the economy as a whole is dire. There is also a
knock-on effect across the industry because
subcontractors, suppliers and service providers are
equally affected.
“In the long-term, we will lose our capacity to
develop infrastructure and will have to depend on
foreign companies in the future. That is why we are
appealing to the government for engagement,”
Mnisi concludes.
Master Builders South Africa (MBSA) is a
Federation of registered employer Associations
representing contractors and employers in the
construction industry and is regulated in terms
of Section 107 of the Labour Relations Act 66
of 1995. The Federation’s nine Master Builders
Associations and three Affiliate Associations
represent more than 4 000 contractors and
Roy Mnisi, executive director of Master Builders South Africa.
employers in the industry.
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AUGUST / SEPTEMBER 2019 //
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