Kicking quacks out of construction sites

An MP hired a contractor to build his house. When it was half-way done, the contractor abandoned the site without notice. The house collapsed within days.

The MP narrated his ordeal with the “rogue” contractor to his colleagues in Parliament last June during debate on the National Construction Authority Bill.

The MP sounded helpless. But not anymore. Today, the legislator, together with many other builders and private developers, must be a happy lot for the Bill, aimed at bringing order in the construction industry by ensuring that only genuine and qualified contractors practise, is now law and is expected to come into operation soon.

The government, which for decades, has been fleeced by wheeler-dealer contractors, variously referred to “rogue contractors”, “cowboy contractors”, and “briefcase contractors”, is even happier.

“We are happy that the National Construction Authority Bill is now law. It is now possible to rid the construction industry of rogue contractors since the new law provides for the blacklisting of those who abandon work half-way or who do not conduct themselves professionally,” said Public Works minister Chris Obure.

The National Construction Authority Act, signed into law by President Kibaki recently, seeks to regulate the building and construction industry by setting up the National Construction Authority, an agency to oversee the sector.

The authority will be charged with registering and accrediting contractors and regulating their activities.

It will also promote professionalism in the sector by ensuring that only trained contractors, construction workers, and site supervisors are registered.

“The new law has given us the teeth to deal with contractors who abandon (government) projects half-way. We will have the option of deregistering them, barring them from working for any government department or the private sector,” said Mr Obure.

He said lack of centralised registration of contractors (the registration of contractors has been fragmented, with each government agency maintaining its own register on administrative basis) has created a situation where non-performing contractors and those barred in one ministry or institution can migrate and actively tender for projects in other ministries and institutions on account of multiple registrations or change of legal status.

According to industry players, lack of a centralised regulation and registration mechanism for contractors has led to the proliferation of non-performing contractors with little or no capacity to undertake works.

The activities of the non-performing contractors have resulted in collapsing buildings due to poor workmanship and non-compliance with specifications, often occasioning loss of life, poorly constructed infrastructure, and delayed completion of works, leading to project cost over-runs and stalled projects.

“I think this new law will help tame rogue contractors and improve the quality of construction work because the contractors now know that if they are deregistered, they will not be able to get work elsewhere,” said Mr Alfred Aluvaala, the director of Miradi Consultants, a quantity surveying firm that also deals with project management.

He said the law has stringent requirements that will ensure that only certain cadres of contractors with a given level of education are allowed to practise.

“At the moment, anybody can register a firm and claim to be a contractor. But under the new law, they will have to be registered by the authority, checked, and their activities followed up to ensure that they follow laid-down procedure. This law will help sieve the profession and leave only those who are serious,” said Mr Aluvaala.

He was in the team that drafted the National Construction Authority Act and is a member of the governing council of the Institute of Quantity Surveyors of Kenya.

He said the country has more briefcase contractors than genuine and qualified ones, although he could not state the number.

According to the Act, a person shall not carry out the duties of a contractor unless that person is registered by a board to be established under the new law.

In the case of a firm, registration can only be given if at least one of the partners or directors possesses the qualifications, technical skills, or experience prescribed by the board.

The Act states that any person who decides to operate as a contractor without registration “commits an offence and shall be liable to a fine not exceeding Sh1 million”, or to imprisonment for a term not exceeding three years.

Any contractor found guilty of unprofessional conduct will also face the same punishment. The Act says that a contractor who fails to discharge his or her duties, responsibilities, and obligations shall have his or her name deleted from the register.

And the future will be grim for blacklisted contractors, according to the Act: “Where the name of any contractor has been deleted from the register, that contractor shall not be registered afresh under any other name.”

Mr Aluvaala said the National Construction Authority will require that before employing anyone as a contractor, developers should check with the authority.

In an earlier interview, Mr Steven Oundo, the chairman of the Architectural Association of Kenya, described the National Construction Authority Act as a “very important piece of legislation for this country as it will bring the much-needed order and confidence in the industry”.

He noted that the construction industry has for many years been negatively affected by lack of legislation to regulate the players.

This, he said, was responsible for the many ills facing the industry, including the proliferation of briefcase contractors who have neither the technical nor financial capacity to undertake projects. This has, in turn, led to many white elephants, especially in the public sector.

“As it is today, any person, regardless of their educational or professional background and experience, can register a construction company and start bidding for jobs. This has opened the industry to the unfortunate state of confusion that it finds itself in today,” he said.

Mr Oundo added: “There have also been poor quality projects, leading to the unfortunate cases of collapsing buildings, unapproved developments, dilapidated infrastructure, and increased cases of corrupt practices.”

According to Mr Obure, the law will help reduce such cases by providing for education, research, training, and standardisation of the construction process.

“The National Construction Authority is expected to create the critical interventions necessary to conduct centralised registration, effective regulation, and enhanced capacity building through training and development of management and technical capacity of the construction industry,” read the Cabinet memo on the Bill that was released last year.

The authority will be charged with researching on any matter relating to the construction industry, promoting quality assurance as well as encouraging standardisation and improvement of construction techniques and materials. It will also develop and publish a code of conduct for the industry.

The law also prescribes the conditions, set by the registration board, for foreign contractors to be allowed to operate in Kenya.

Among other things, such firms shall be required to adhere to stipulated ownership structure regulations for foreign firms.

The Public Works minister shall be required to clearly state the categories of contracts for which foreign firms may apply and those which shall be reserved for local contractors.

This begs the question: Does Kenya have enough local contractors? Do they have the capacity to undertake the construction works that are reserved for them?

“The problem we have currently is that most indigenous contractors don’t have the capacity to undertake big construction works,” said Mr Aluvaala, noting that most abandoned the profession due to the hard economic times of the early 1990s and are only making a comeback now.

But most of them still lack the requisite knowledge and finances to compete. “What we have are low-cadre contractors who have a problem with basic issues like proper pricing to enable them to make a profit and hiring qualified people to run their outfits,” he said.

However, it is not all gloom. After acknowledging this weakness, the Institute of Quantity Surveyors of Kenya last year launched a training programme to equip local contractors to handle large works, especially the sizeable infrastructure developments the country is currently undertaking.

Some 720 local contractors in Central Rift (Nakuru), Upper Rift (Eldoret), Nyanza, Nyeri and Embu have been trained under the programme, which is headed by Mr Aluvaala. The team expects to cover the remaining regions by next month.

The short training, usually two days, focuses on how to mobilise funding for construction work, site management, dispute resolution, and pricing.

“The main challenge we found is that most local contractors lack both knowledge and funding. We think it is important to help them build the necessary capacity,” said Mr Aluvaala.

Hopefully, the new law, expected to come into force by August this year and which has training and “capacity building” as some of its key mandates, will also help local contractors to become more competitive.