Presenter

Geoffrey Vaughn

13/02/2014Ministry of Public Works 1

� The construction sector as define by “Standard

Industrial Classification”, are companies or sub-sectors

that are engaged in the construction of buildings

(residential and commercial), structures (bridges, dams,

sluices etc). Included are those sub-sectors that engage

in demolition works, blasting, soil investigation, drilling,

landfill, and those engaged in infrastructure works

(roads, drains, ports, airport etc).

13/02/2014Ministry of Public Works 2

There are special characteristics which relates to exceptional

relationship between the construction sector and the level of

economic development such as

� The level of adaptation of technology by contractors in Guyana.

� The level of development of our human resource mainly in

science and technology, construction etc.

� The development and level of our infrastructure system in

Guyana.

� Contribution of National Funds (Budget allocation) to

infrastructure development.

13/02/2014Ministry of Public WorksMinistry of Public WorksMinistry of Public WorksMinistry of Public Works 3

Guyana continue to experience economic growth the latest

estimates shows that 2013 saw a economic growth of

approximately 5%. This is excellent but how do we sustain

this with all the challenges we are faced with in our critical

construction sector.

13/02/2014Ministry of Public Works 4

Challenges that would be addressed in this presentation are:

� Education and Training

� Contractors Capacity

� Utility Services

� Material Shortages and Cost Increases

� Quality in Construction

13/02/2014Ministry of Public Works 5

Guyana continues to have a shortfall in this most important asset

our human resource. This asset is needed to meet the demand of

the technological revolution of the twentieth century.

There is an ominous shortage of professionals, sub professionals,

technicians and skilled tradesmen. The weakness is most

noticeable at the level of sub-professionals and supervisory staff

such as chargehands, technicians and foreman. Most times

chargehands and foremen are procured from the ranks of the

skilled (senior) tradesmen (Suite 2001).

13/02/2014Ministry of Public Works 6

An overview of the 2012 2013 CSEC results shows

that much students are not passing the science

base subjects such as Mathematic (30.35%),

Chemistry (52.39), Physics (54.34%) and English

(45.69). This is where the core of our Construction

challenges begin.

13/02/2014Ministry of Public Works 7

In reviewing reports from the University of Guyana

Faculty of Technology for the period 2009 to 2013

shows that two thousand nine hundred students

(2,900) enrolled for the Engineering programme

from a total enrollment of thirty one thousand and

ninety (31,090).

This represents 9.3% for the five year period of the

total University population.

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YEARS ENROLLMENT AMOUNT

2013 2013 2013 2013 ---- 2014201420142014 677677677677

2012 2012 2012 2012 ---- 2013201320132013 613613613613

2010 2010 2010 2010 ---- 2011201120112011 640640640640

2011 2011 2011 2011 ---- 2012201220122012 748748748748

2009 2009 2009 2009 –––– 2010201020102010 222222222222

TOTAL TOTAL TOTAL TOTAL 2,9002,9002,9002,900

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Even our technical Institute saw a decline in its pass

rate for 2012 (76%) and 2013 (58%) a decline of

18%. It must be known that 15% of the student

population drop-out for various reasons.

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The issues raised in training gives us an

understanding to the reasons for;

� Time overrun

� Basic understanding of Bill of Quantity while

tendering

� Lack of understanding of the procurement rules

� Cost overrun

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Assessing the contracts awarded for the last five

years, projects where loans or grants are received

via funding agencies (IDB, EU, World Bank) shows

that only a few National contractors have the

capacity to execute projects funded by these

agencies.

13/02/2014Ministry of Public Works 12

AdvantagesAdvantagesAdvantagesAdvantages DisadvantagesDisadvantagesDisadvantagesDisadvantages

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opportunitiesopportunitiesopportunitiesopportunities forforforfor locallocallocallocal firmsfirmsfirmsfirms....

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andandandand managerialmanagerialmanagerialmanagerial capabilitycapabilitycapabilitycapability totototo undertakeundertakeundertakeundertake mostmostmostmost ofofofof thethethethe

foreignforeignforeignforeign fundedfundedfundedfunded projectsprojectsprojectsprojects....

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acquiredacquiredacquiredacquired expertiseexpertiseexpertiseexpertise....

13/02/2014Ministry of Public Works 13

� Poor quality in construction results in rework. Poor

quality elements not only do not perform in the

manner for which the structures were designed and

built i.e. they possess reduced capacity, but they

last only a fraction of their design life; this issue

have become one of our major concern in the

construction of our roads bridges and also

buildings.

13/02/2014Ministry of Public Works 14

Frequently we excuse or attempt to justify poor

quality by saying we are working to meet schedules

or deadlines or we are cutting cost of construction.

We have seen instances where poor quality has led

to contract being terminated as per contract

condition. Poor quality construction is all around

us, our roads, buildings, as well as our other

infrastructures and utilities.

13/02/2014Ministry of Public Works 15

In 2013 several projects saw materials being rejects

for not meeting specification. We have had several

contracts within the Ministry terminated for poor

quality works.

13/02/2014Ministry of Public Works 16

The issue of quality is closely related to training and

development, they are shortages of clerk of works

and technicians whom on most projects has the

responsibility of ensuring quality and standards as

per contract specifications.

Poor quality of construction means that there will be

a high percentage of rework which we have seen

over the last five years.

13/02/2014Ministry of Public Works 17

The shortage of construction materials continues to

be a major concern to the construction sector. The

sector has seen a significant growth with increase

construction in the housing, roads, sea defences,

bridges and other infrastructure. This increase has

caused a increase demand for certain construction

materials such as:

13/02/2014Ministry of Public Works 18

� Stone

� Cement

� Steel sheet piles

These are three materials which are constantly

needed by contractors for the execution of works.

There were several projects delayed due to the

shortage of these materials.

13/02/2014Ministry of Public Works 19

Projects within the sea defence unit and the National

Drainage and Irrigation Authority required sheet

piles which was difficult to access due to the

reduction in production by the Chinese company

because of Environmental Issues. Both entity saw

delays in the projects works for almost 1year.

In some cases alternative material was considered

but with some amount of reluctant.

13/02/2014Ministry of Public Works 20

� 2011 to 2013 saw a shortage of aggregate for the

construction sector. Ministry of Public Works CPTU

was tasked with the assignment to determine the

effects of aggregate shortage in the sector. Below

is a table of the findings;

13/02/2014Ministry of Public Works 21

We must not forget the challenges that we faced in

2005 – 2007 during our preparation for World

Cup cricket. During this period steel prices went

up, there was a shortage of cement and even a

shortage of our critical human resources.

These challenges are not new therefore we have to

find ways to deal with it and the time is now.

13/02/2014Ministry of Public Works 22

Details Details Details Details Amounts/TonsAmounts/TonsAmounts/TonsAmounts/Tons

BaracaraBaracaraBaracaraBaracara QuarriesQuarriesQuarriesQuarries 114,457114,457114,457114,457

ToolsieToolsieToolsieToolsie PersaudPersaudPersaudPersaud LtdLtdLtdLtd 84,96584,96584,96584,965

BK Quarries Inc.BK Quarries Inc.BK Quarries Inc.BK Quarries Inc. 464,043464,043464,043464,043

Metallica CC QuarriesMetallica CC QuarriesMetallica CC QuarriesMetallica CC Quarries 7,4427,4427,4427,442

Durban QuarriesDurban QuarriesDurban QuarriesDurban Quarries 9,2909,2909,2909,290

TotalTotalTotalTotal 680,197680,197680,197680,197

13/02/2014Ministry of Public Works 23

DescriptionDescriptionDescriptionDescription DemandDemandDemandDemand SupplySupplySupplySupply Deficit/SurplusDeficit/SurplusDeficit/SurplusDeficit/Surplus

BouldersBouldersBouldersBoulders 788,560 110,950 677,610

Under LayersUnder LayersUnder LayersUnder Layers 85,943 56,687 29,256

3/4 “ stones 3/4 “ stones 3/4 “ stones 3/4 “ stones 416,337 85,263.24 331,073

3/8” stones3/8” stones3/8” stones3/8” stones 9,673 4,351 5,322

CrusherCrusherCrusherCrusher run (1run (1run (1run (1stststst and and and and 2222ndndndnd Grade Grade Grade Grade

139,290.32 166,997 27,706

½” Stones½” Stones½” Stones½” Stones 7,500 50,915 43,415

Other AggregatesOther AggregatesOther AggregatesOther Aggregates 0 205,034 205,034

TotalsTotalsTotalsTotals 1,447,3031,447,3031,447,3031,447,303 680,197680,197680,197680,197 767,106767,106767,106767,106

13/02/2014Ministry of Public Works 24

� In this presentation of these critical issues one

does not claim that the list is all inclusive. It seeks

to briefly address the more critical

issues/challenges.

� These issues/challenges explained are our

expectations for a collective discussion that will

serve to achieve a higher level of efficiency within

the sector.

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� The Government and the Private Sector need

to work together so as reduce these

challenges. There is need for more Public

Private Partner projects which will reduce the

impact faced in the sector.

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Sinnott, Lewis and Pineda (December, 2005, p17) stated

“every“every“every“every oneoneoneone dollardollardollardollar spentspentspentspent onononon constructionconstructionconstructionconstruction generallygenerallygenerallygenerally

generatesgeneratesgeneratesgenerates upupupup totototo fivefivefivefive ((((5555)))) extraextraextraextra dollarsdollarsdollarsdollars ofofofof GDP”GDP”GDP”GDP”....

The capital spending on construction services may

stimulate the economy by creating employment and

boost the GDP but one of the major factor other than

the those mentioned, is that it provides built

infrastructure which is essential for the service and

manufacturing sector.

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