'Construction mafia is tightening its grip on builders'

Roy Mnisi, the executive director of Master Builders South Africa, which represents 4,000 construction companies, says in spite of government commitments to deal with the construction mafia the situation is getting worse.

“On the ground our members haven’t felt the impact of such commitments,” he says.

Public works & infrastructure minister Sihle Zikalala repeated the pledges last month when he revealed that the construction mafia were costing the economy R68bn a year.

“We're a bit cynical about these promises. We’ve heard them several times over the years at ministerial and presidential level, but from our members’ point of view the situation is getting worse.”

As evidence of the government’s intent, Zikalala said there’d been 200 arrests, but Mnisi is unimpressed. “Although recently we’ve seen some arrests we’re also seeing the construction mafia spreading to areas where in the past we didn’t think it would happen.”

They used to attack only mega projects such as hospitals, casinos, national roads and bridges, but now no construction project anywhere is safe, he says.

Even minor construction projects are being attacked by thugs armed with weapons from pangas to AK-47s, who call themselves “business forums”.

Having been confined mostly to metropolitan areas in KwaZulu-Natal and the Western Cape, they've been increasingly active in Gauteng and rural provinces such as North West, Mpumalanga and Limpopo.

Professionals decide they don't want to work in a war zone. We're seeing them go to countries like New Zealand and the United Arab Emirates

“They're spreading everywhere, and not only in the metropolitan areas as in the past,” he says.

“People realise there are no consequences. And with high unemployment they’re thinking of things to do to survive. They realise that attacking contractors is a good opportunity to make some money, and there won’t be consequences.”

The government must show them that “you don't deal with unemployment through lawlessness, by threatening, shooting and killing contractors”.

“Until the government deals with law enforcement we are not going to win this war at all.”

Since Business Against Crime began working more closely with the police there've been some arrests and convictions, “but you can't say this is making a significant impact when you've got one person arrested and five people going out to commit the very same crime”.

“People need to know that ‘if I do this and I get caught, these are the consequences’. When we get to that point then we can say we’re making progress.”

Meanwhile, increasing numbers of businesses are giving in to the demands of the mafia to pay them 30% of the value of the contract.

They realise that the risk of not giving them the money is that they won't be able to complete the project for their client, so they won't get paid and their employees will lose their jobs.

“This is what contractors are telling us. They'll rather pay the money and continue with the project than go to the police to ask for assistance, because that assistance in most instances doesn't come.”

Although they are discouraged from paying what amounts to “protection money”, for them “it's a survival strategy”.

To this extent construction mafia activities are coming to be accepted as “the norm”, which is bad for the whole country, he said.

“Profit margins in the construction sector are very low, and if your profit margin is being eaten by people who come and demand money then next time you quote for a project you factor this into your price.

“If it's a public sector project it means the government is paying more. This means the private sector is not investing in infrastructure development.”

Many of their members are small and medium enterprises without the reserves to pay the mafia, and so go out of business.

But even the bigger, better resourced contractors are being affected, such as JSE-listed residential property developer Calgro M3, which terminated its projects in KwaZulu-Natal in 2022 because of mafia disruptions and threats to employees.

He says the association is getting an increasing number of calls from members saying they can't continue to operate. This is eroding South Africa's capacity to build infrastructure because “lots and lots” of the most highly skilled professionals, such as engineers, are leaving the country.

“They decide they don't want to work in a war zone. We're seeing them go to countries like New Zealand and the United Arab Emirates, where their skills are in demand and they can do their work without risking their lives.”

Mnisi was part of a delegation which in 2016 “thoroughly briefed” the government, including the then KwaZulu-Natal premier Zikalala, on the dire threat posed by the construction mafia.

So he finds the lack of action since then “surprising to say the least”.

“They talk about infrastructure development as the central pillar of their national recovery plan which identifies the construction sector as one of the key enablers of growth. Why would government identify this as a key sector we can use to improve our economic situation and yet do very little to make sure it is protected against anything that can hinder its operations?

“When you have a government that has clearly identified infrastructure as a priority it is hard to understand, let alone accept, its failure to deal with such a threat to the sector.”

One explanation is that the construction mafia have political connections.

“We know of instances where politicians tell mafia members to harass certain construction projects to stop them being seen as a success of a rival politician. So that is happening.

“In a country where you've got the rule of law this shouldn't matter. The application of the law should happen regardless. But we've reached a level where people think lawlessness is the way to go, it's become the norm.

“When you get to a level where you expect people to behave illegally it tells you we have reached rock bottom as far as lawlessness is concerned. We've been saying to the government consistently that the only way to deal with the construction mafia is to make sure that the law is enforced. All other things become secondary.”

He believes the government has the capacity to deal with the construction mafia, but lacks political will.

No construction mafia were allowed to disrupt 2010 World Cup infrastructure projects, he says. “Special courts were created to deal with crimes related to those projects. You wonder why we don't have the same controls and systems now?”