Journal of Civil Engineering Vol 68 No 2

Journal of the South African Institution of Civil Engineering Volume 68 Number 2 June 2026 3 government projects fall short when assessed against project management indicators. Ratshisusu (2014) noted that the Construction Industry Development Board (cidb) grade does not reflect the contractors’ capabilities in South Africa. Presently, the cidb has nine grading levels, and contractors are upgraded to the next level based on their financial capabilities and evidence of completed projects. Table 1 shows the nine different grades in which contractors can be registered, along with the corresponding contract value in South African Rands (R). The cidb seeks not only to grow the South African economy through the construction industry, but also to develop improved industry performance and best practices (Republic of South Africa 2000). One method for improving industry performance and best practices in the construction sector is to ensure that the process for grading contractors is efficient, effective, and benchmarked against inter- national practices and norms. Currently, registration for all cidb grades is based solely on the contrac- tor’s financial capability and evidence of completed projects submitted during the application process. The cidb requires the following documents for application (Construction Industry Development Board 2020): Q Q Application form Q Q Proof of company registration Q Q Identity documents Q Q Tax clearance certificate Q Q Electrical certificate for EB works Q Q Financial statements for the two years immediately preceding the application Q Q Track record documents (appointment or award letter, completion certificate, and payment certificate). It is interesting to note that only electrical works (EB) require some form of certi- fication, which is not the case with civil engineering (CE) and general building (GB) works. The cidb’s 2012/13 annual report states that the following amendments to the registration regulations were proposed (Construction Industry Development Board 2013): Q Q Removal of the requirement for contrac- tors to have registered professionals in their employee base Q Q Reduction in the annual turnover requirements Q Q Reduction in track record requirements Q Q Provision for review of the tender value limits Q Q Removal of the method B registration option where enterprises are registered with high financial capacity but no track record Q Q Improvement to the grading calculation of joint ventures. According to Construction Industry Development Board (2013), these amend- ments were designed to better align the Register of Contractors with developments in the construction industry and with the state of development of the emerging sector. It is observed from the require- ments that contractors are able to progress from one grade to the next without any meaningful emphasis being placed on their technical knowledge or expertise. Instead, it is assumed that when contractors have implemented projects and are financially within the required specifications, they are competent to move to the next grade. The 2013 amendments are a further indication that the cidb does not put emphasis on the technical knowledge and expertise of the contractor. The cidb’s grading system should be robust, as contractors are awarded public sector infrastructure and construction projects based on the grade they hold. An enhanced contractor grading and per- formance assessment framework has the potential to not only improve the accuracy of the alignment of the capabilities of contractors with their grades (Ratshisusu 2014), but also to improve the performance of the South African construction sector. It is important to understand that spending money on public infrastructure is synonymous with spending money on people themselves (Arif 2013). Therefore, decision makers are required to think innovatively and develop inventive and improved ways of grading contractors and monitoring and evaluating infrastructure project performance. This creates a need for systematic processes, decision support frameworks, and procedures that would enable better decision making (Mihai et al 2000). According to Ratshisusu (2014), the cidb’s grading system has some deficien- cies. Notably, the system does not provide enough information to clients on the capac- ity and ability of firms to undertake con- struction works. The system would be more effective if contractor grades accurately reflected the contractor’s actual capacity and ability to execute a construction project at a given point in time, with such informa- tion being made available by the cidb. For instance, the cidb’s Register of Contractors includes more than 50 firms at Grade 9 level – the highest grade a con- tractor can attain – that may potentially qualify to undertake large infrastructure projects. In practice, however, only a lim- ited number of firms possess the capacity and expertise to successfully deliver such projects. The number of firms within the Grade 9 category creates a false impression that there is a substantial pool of large con- struction firms, whereas competition for major infrastructure projects is effectively limited to a small group of leading contrac- tors (Ratshisusu 2014). Presently, the South African construc- tion and civil engineering sector does not have a minimal requirement for contrac- tors who wish to enter the construction industry. Anyone, with or without techni- cal knowledge, with little or no schooling, can register a construction firm. It is pos- ited herein that considering minimal entry requirements for registering a construction firm can also assist in improving the status quo of the local construction sector. Having such requirements would likely increase the success rate of Grade 1 contractors and would also make it easier for companies seeking to develop enterprises to select entities with potential (Construction Industry Development Board 2016). Any minimum criteria for registration would, however, need to consider the currently registered Grade 1 contractors. According to Construction Industry Development Board (2016), 91% of the current registered Grade 1 contractors are black-owned, 32% are women-owned, and 26% are youth-owned. The high rep- resentation of historically disadvantaged Table 1 Contractor registration grades and contract value (Construction Industry Development Board 2019) Grade Tender value less than or equal to (R) 1 500 000 2 1 000 000 3 3 000 000 4 6 000 000 5 10 000 000 6 20 000 000 7 60 000 000 8 200 000 000 9 Unlimited