lecture 16 - dev. of small scale contractor capacity.gp

8/4/2019 Lecture 16 - Dev. of Small Scale Contractor Capacity.gp

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CROSS RIVER STATE RURAL

ACCESS AND MOBILITY

PROJECT (RAMP)CAPACITY BUILDING AND

TECHNICAL ASSISTANCE

TRAINING WORKSHOP ON

ROAD MAINTENANCECONTRACTING AND

TECHNIQUES FOR SMALL AND

MEDIUM SCALE LOCAL ROAD


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Development of Small Scale

Contractor Capacity for Rural RoadWork


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INTRODUCTION

Over the last fifty years road network construction and

expansion have been undertaken by governments of

developing countries.

Huge investments in road construction have been madethrough international funding agencies.

Unfortunately these governments did not allocate

sufficient funds to continue the investment in the

maintenance of their networks. This resulted in the new road network deteriorating,

sometimes into a series of muddy tracks, which are often

barely passable even in the dry season.


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INTRODUCTION

Although substantial progress is made in

setting the appropriate private sector strategy,

it is becoming increasingly difficult to

implement as problems associated with

contracting procedures and the industry

support framework are becoming more

apparent to both contracting organisationsand road agencies.


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The Need For A Framework To Govern

Private Contracting

There are 5 different types of contractingorganisation, which are capable of undertakingconstruction work Small builders and jobbers- these are small generally

one-man businesses who undertake building projectsor work for other larger companies.

Communal and Self help groups

State owned organisations

Private contracting companies

Foreign contractors


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The Need For A Framework To Govern

Private Contracting

small scale contractors in Nigeria are numerousand restricted, due to their size and resources, toundertaking small building work and occasional

minor civil engineering work. Many of these businesses are often small enough

to be invisibleto national construction statistics.

For road maintenance and construction to be

efficiently carried out in a competitive marketthere is a need for contracting firms of all sizes toundertake various sized projects


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The Problems Facing Small Scale

Contractors

For small contractors, like all small businesses, the main

problem is lack of access to and difficulty in obtaining

credit.

Compared to other small businesses, small construction

companies have a high financial turnover and hence a

larger need for short term working capital. This is due to

the amount of materials required, relatively large numbers

of staff wages and equipment purchase or hire costs.

They also need long term capital to cover the costs of

expanding the business and financing the purchase and

depreciation of equipment.


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Contractors

Small scale contractors are dependant on regular payments to

retain staff, pay wages, obtain material supplies and maintain

a good relationship with their creditors.

Poor contract documentation is another problem experienced

by small contractors who are attempting to develop their

business in the road maintenance and construction sector.

Small contractors frequently complain of poor work

continuity. They may have a gap of many months between

contracts.


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Contractors

Additional problems faced by small scalecontractors include: Difficulty in recruiting suitably trained labour and

supervisors

Poor availability and/or high costs of constructionmaterials

High capital cost of equipment and high loan interestrates

Lack of construction equipment for hire and difficultyin obtaining equipment spares

Poor on site supervision and availability of roadagency staff to address queries


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The Institutional Framework In

Developing Countries

Support framework for road works

Trade organisations: Consisting of material suppliersand manufacturers and work to promote to promotetheir products and services to contractors andconsultants.

Contractors / Consultants Associations:Organisations that assist in development of contractprocedure and national standards.

Learned Societies: They provide knowledge anddissemination to the whole industry, examine andcertify engineers and technical staff.


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The Institutional Framework In

Developing Countries

There are therefore two distinct institutional

problems, which must be addressed by

countries who are attempting to utilise the

private sector to undertake road constructionand maintenance.

The lack of a consulting engineering profession

The poor capacity within the support framework toassist the contracting sector.


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Institutional development of the

support framework

In order to achieve an institution framework forprivatisation it is necessary to initiate anddevelop organisations, which can provide support

framework. For example ASIST (Advisory Support Information Services and

Training) Supported by International Labour Office(ILO)

MART (Management of Appropriate Road Technology) Supported by DFID (Department for InternationalDevelopment)


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ASIST (Advisory Support, Information Services

and Training)

The overall objective of ASIST is to achieve awide-scale adoption of employment intensiveapproaches in national transport and

infrastructure investment policies andprogrammes.

The immediate objective of ASIST is to increaseuse and efficiency of labour-based methods to

carry out infrastructure, particularly road,construction and maintenance activities in SubSaharan Africa.


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ASIST (Advisory Support, Information Services

and Training)

In order to meet the immediate objective, theproject was divided into three components: advisory support (technical and policy advice, and

project backstopping),

information services (networking, technical enquiryservice, publications, research), and

training (international courses for engineers, seniortechnicians and trainers).

ASIST works closely and effectively along sidenational authorities, road agencies and projectstaff in its region providing the servicesdescribed above.


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MART (Management of Appropriate

Road Technology)

The Management of Appropriate Road

Technology (MART) initiative aims to reduce

the costs of constructing, rehabilitating and

maintaining road infrastructure, and vehicleoperations in developing countries.

It is based on a research project funded

principally by the British Department forInternational Development (DFID)


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Road Technology)

The current phase of the MART programme willinter alia draw together existing expertise inlabour and intermediate equipment-based

technology and the development of privateconstruction enterprises to produce a series ofguidelines on the four priority topics of:

Hand tools;

intermediate equipment;

private sector development and

institution building.


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Road Technology

The MART initiative is strongly research-based

Thus much of the output will be in the form of journalpapers and other formal publications suitable asreference material

The MART project therefore assists the supportframework by codifying international expertise fromdonors, consultants, projects and other researchorganisations and providing the information in a

more useable form for government agencies anddepartments and centres of learning such asuniversities and learned societies.


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Conclusion

This paper has discussed the development ofthe private sector in developing countries,particularly Africa and the frameworks

established in developed countries. It reviewed various obstacles encountered by

small private contractors to develop andexpand their business and highlighted theneed for framework to govern privatecontracting.


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lecture 16 - dev. of small scale contractor capacity.gp

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