Legislation to regulate construction boom

Contractors grading system revised:

Sanjeevi JAYASURIYA

The construction industry has the potential to grow as the peaceful environment has provided an impetus for the industrial development. Chamber of Construction Industry Sri Lanka Chief Executive Officer/ Secretary General, Dakshitha Thalgodapitiya said that there is a grading system for contractors and it is done by the Institute of Construction Training and Development (ICTAD) an agency functioning under the Construction and Engineering Ministry.

Here are his comments on the construction industry.

The contractors are graded under buildings, highways, bridge construction, water supply and drainage, designing and land reclamation, storm water and heavy construction.

In addition there are specialized construction contractors who are related to electric and mechanical services. Some of these categorizations do not appear to be logical. The general construction company grading is linked to financial limit.

The grading system has been revised and the highest grade is related to contractors whose financial limits are over Rs 600 million.

In the recent past more rational and transparent methodology has been adopted. However, it must be borne in mind that statutory authority for grading should be a totally independent agency taking the form of a regulatory authority.

The present composition of this agency leaves room for this independency and integrity to compromise. But, the new Act tabled in the Parliament provides for a regulatory authority.

With around 95 percent of the construction constructors falling within the broad definition of small and medium enterprise, specific action must be taken to develop the SME sector which will also ensure that the benefit of development is accrued to people.

There is a need to train construction craftsmen. Unfortunately, not even five percent of the construction craftsmen are accredited and have undergone formal training.

The Training and Vocational Education Commission (TVEC) has now introduced National Vocational Qualification (NVQ) for construction craftsmen.

The Chamber has been in the forefront in the construction craftsmen training having produced more than 700 craftsmen for NVQ level 3 qualification through the training centres operate in the districts of Kalutara, Galle, Matara and Hambantota.

The Chamber was successful in obtaining assistance from Germany to set up training centres in Batticaloa under the theme conflict transformation through livelihood development.

Training in construction craftsmanship provides livelihood opportunities for those with least educational qualifications from the most vulnerable sectors of the society within a shortest time. Construction craftsmen for NVQ level 3 can be trained within a period of six months with three months practical training at the construction contractors' worksite.

The training curricula such as masons, carpentry have been developed and present accreditation methodology is comparable with those in the developed world.

Our training programs are based on TVEC curricula and we also have given emphasis to occupational health and safety in addition to information technology.

With the establishment of the University of Vocational Technology and NVQ system opportunities are available for construction craftsmen to even become professional engineers by going through the NVQ system.

The school leavers have a reluctance to join the construction industry which also have not been attractive to them.

The construction industry is not properly marketed currently as an attractive occupation not withstanding the fact that the construction craftsmen are all capable of earning a fairly attractive wage.

Therefore, there is a need to change the image of the construction craftsmen and also to ensure construction workforce is provided with secured employment with benefit enjoyed by other professions.

Since construction industry is largely an informal sector and most craftsmen not been accredited in the rating of construction contractors highest priority must be given for those who are employed and provide them with a degree of permanency and security.

There are many infrastructure projects that are financially viable but face difficulties in raising resources for implementation. Funding of such projects through innovative mechanism merit highest consideration of policy makers. Infrastructure has emerged to be the key driver for sustaining robust growth of the economy.

The Government has been focusing its prioritized attention on infrastructure development but not has been successful in attracting sufficient private investment as required.

Practice of funding infrastructure projects on commercial borrowing at exorbitant rate must be discontinued forthwith. Funding of such projects through innovation mechanism merits highest consideration of policy makers.

It is necessary to have a mechanism to generate more resources from off -budget resources.

These include direct use charges, debt financing, access to capital markets through various financial tools and value capture through linkage whereby the right to commercially developed land is tied to an infrastructure project.

The involvement of the private sector also calls for a strong and reliable regulatory framework which is a key challenge. Sri Lanka has only limited success in attracting private investment in infrastructure projects which has remained limited to only marketable commercial undertakings such as power generation, mobile phone networks and container terminals at ports while the potential for private sector involvement varies across the sectors there is significant scope for expansion in all sectors.