The government has declared war on the “construction mafia,” with Public Works Minister Dean Macpherson announcing a sweeping crackdown that could see dozens of companies blacklisted from state tenders. This follows a surge in extortion cases at construction sites nationwide, prompting a joint effort between law enforcement and the Department of Public Works.
Since November, police have investigated a staggering 745 construction-related extortion cases, resulting in 240 arrests. Gauteng and the Western Cape account for the majority of these incidents, highlighting the scale of the problem. Macpherson revealed that an anonymous extortion hotline has also yielded significant results, with 779 reports leading to 30 cases being referred to provincial authorities.
“We have made remarkable progress to restore the rule of law at construction sites and bring an end to extortion by criminal elements,” Macpherson declared. He emphasized the deployment of specialized task teams to hotspots and the government’s determination to reclaim infrastructure projects serving communities.
A key focus of the crackdown is addressing the “30% demand” – a tactic used by criminal syndicates to extort a portion of project procurement. Macpherson revealed that his department is working with the Treasury to reform regulations under the Public Procurement Act, closing loopholes that enable these demands.
“If we want to bring an end to these criminal syndicates, we will have to remove the incentives which these criminal syndicates use to operate,” he asserted.
The Construction Industry Development Board (CIDB) has been tasked with urgently blacklisting underperforming or unethical contractors, preventing them from securing any state tenders. “Within the months ahead, the pace at which companies are delisted should be rapidly increased, with over 40 companies facing blacklisting,” Macpherson stated.
The Minister also addressed the issue of slow action against corrupt suppliers, revealing that only one company had been delisted since 2002. He pledged to reform auditing processes and strengthen blacklisting policies to ensure accountability.
Provincial coordination is also being improved, with a focus on oversight and accountability. Discussions are underway to reform the Expanded Public Works Programme, shifting from unskilled labor to skills-based training that leads to permanent employment.
Furthermore, the Department plans to transform its Property Management Trading Entity into a property asset manager, releasing state properties for private sector development. This initiative is expected to attract billions in investment and create thousands of jobs.
The department is also targeting small harbors for private sector development to boost tourism and economic growth. A special projects unit will be established to address stalled construction projects, such as the Sarah Baartman Centre of Remembrance Project.
Infrastructure South Africa’s project preparation bid window has attracted significant interest, with winning bids to be announced later this month. These initiatives reflect the government’s commitment to tackling corruption, promoting economic development, and ensuring that public funds are used effectively.