SECTION B – FEEDBACK TO THE DRAFT CONTRACTORS’ LICENSING REGULATIONS
B1. Feedback specific to the draft regulations as drafted. This section provides feedback to the specific draft law and hence comments are specific to the text ONLY. Observations that go beyond the drafted text / regulations are provided in section B2.
Part 1 General Provisions Applicability and transitory arrangements
(4) We believe that the applications should be determined within a stipulated timeframe and not allow for such an event to materialise as otherwise this gives room to complications. The BCA should plan and prepare the necessary resources ‘a priori’.
(5) Ditto. Temporary licenses should ONLY be issued on an exceptional basis as otherwise this may create a precedent with temporary licenses becoming the order of the day. What constitutes and exceptional event would need to be qualified ‘a priori’
Code of practise and responsibility
No specific observations.
Part II Contractors Licensing Committee Establishment of the Committee
The composition is too generic. We strongly recommend that professionals working within the industry are represented in this committee. The Professional Construction Manager is key to any project development and therefore MCCM hereby recommends that a representative from this profession is included within the committee.
Secretary to the Board
No comments.
Term of office
Term is reasonable.
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Functions of the Committee
10 (a) The bill as drafted suggests that the Committee may appoint a sub-committee in which case we feel that this is still very vague. Should there be a sub-committee to assist the Board in the evaluation process, we believe that the terms of reference of such a committee would be detailed at this stage and are made public as part of the consultation process. The composition and credentials of the members need to be similar or equivalent to the members of the Board. Alternatively, rather than a sub-committee, it might be a case of appointing a number of Consultants as advisory to assist the Committee with respect to the evaluation process. The evaluation of an application needs to be time bared and procedures published as part of the consultation process.
Meetings of the Committee and Procedure
No comment.
Remuneration of the Committee
No comment.
On a general note, regarding the evaluation of an application, as in the process. Will there be any consultations with other regulatory bodies or related? If so, what are the intents and the how? We recommend that as part of the application process, there should be adequate due diligence and consultations that go beyond the technical capacity aspects ONLY i.e., commercial reliability aspects, financial soundness / good standing, after sales reputation / services, litigation history etc. The process needs to be published as part of the regulations.
Part III License
No comment.
No comment.
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Publication of license
Eligibility
Application for issue of license
(3) (d) The draft as texted makes reference to a licensed administrator? What does licensed mean in the context of the administrator? A more detailed brief should be provided with respect to the credentials of such a person. This should also include the role and responsibilities in view of the same regulations.
Licensing decisions by the Committee
This part warrant a detailed indication of the process. Maybe a schedule can be included reflecting a step by step process and time frames. The procedure reflecting the evaluation process is deemed important at this stage. Time frame to adjudicate need to be determined prior to enactment of regulation.
Notice to grant license
No comment.
License Certificate
No comment.
Decision to refuse an application for license
No comment.
Renewal of Licenses
What are the cause for non-renewal or process in cases of renewal objection? Procedure? Timelines?
Changes to Registered details
No comment.
Application for the cancellation of license
In such a case, we recommend that some form of performance guarantee would need to be submitted to ensure that obligations that may crop-up relative to works conducted (latent defects, commercial claims / bad workmanship etc), be in place as a form of detriment (commitment) to address such issues. This would obviously be determined over a period that is commensurate to the context of the works conducted, and in line with any legal obligations relative to after sales / following completion of the works. Alternatively, should a performance Guarantee be considered to erroneous, the Licensed
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Contractor would be obliged to maintain an appropriate Insurance in place and along the years post cancellation of license. This area is very important as somehow ‘3rd parties’ and their interests need to be protected even though a contractor might not renew the license or terminate the license. Alternatively, the specific contractor would need to declare and transfer the after sales obligations / liabilities relative to the specific declared works prior to the withdrawal of a license or non-renewal, for a specific time as stipulated by law.
Part IV Offences and Penalties Offences
No specific comment.
Administrative Penalties
No specific comment
Suspension and revocation of license
This part is considered very vague and should be explained / detailed especially the eligibility (the cause that would generate such an event)
Also, the criteria in terms of reinstatement need to be qualified and listed.
A tentative list of events or reasons why a license may be revoked. As it stands it is too subjective thus leaving room for interpretation especially by the evaluating committee.
Part V Schedules
Schedule 1 – Service Activity
Refer to comments under section B2.
Schedule 2 – Criteria of each service activity
A. Licensing of Demolition Contractors
Refer to comments under B2.
B. Licensing of Excavation and Piling Contractors
Ditto.
C. Licensing Construction
Ditto.
Schedule 3 – Fees
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Administrative Fees
No comment
License Fees
The licensing fee should be commensurate to the activity and may also reflect the size of the Company or Contractor in terms of categorisation and classification (categorisation and classification are commented within section B2, next page)
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B2. Feedback – proposals for consideration
MCCM’s feedback to the current draft looks at the short-, medium- and long-term aspects of the upscaling of the Construction Industry and is therefore putting forward other observations and comments that it believes would add value to improving the current draft legislation on a constructive basis.
A holistic approach and not in isolation – connection to skills and standards. The construction industry is much more than the demolition, excavation and what is being perceived as the traditional building contractor (construction) activities. The construction contracting ecosystem is today vast including multiple disciplines and specialisation fronts that have reacted and continue to react in line with market developments this including but not limited to technological improvements, new materials and the way buildings or various infrastructural developments are designed. Management is key in all that is done and the lack of appropriate management remains key to the successful adaptation of improved regulations.
Today’s industry gives substantial weight to sustainability aspects on both the economic / business model aspects and the specific durability / resilience / practical aspect of the asset itself. Within this context, whilst MCCM appreciates that a local licensing regime to operators within the local construction industry is non-existent, the introduction of a licensing process is very welcome, but it observes that major activities and aspects other than demolition, excavations and ‘construction’ have been somehow side lined or ignored.
The draft proposes licensing to operators working within the demolition, excavation and construction spheres. All things being equal, MCCM therefore believes that similarly all other activities / trades maybe easily introduced now especially those that we are locally accustomed to. This way, regulations would remain faithful to industry and mitigate against disparity within the same industry going forward. A benchmark is therefore generated on same level playing field amongst current operators covering the majority of activities within the industry itself. Otherwise, one would be risking that ONLY a portion of the industry’s operators kick-start the upscaling process with others trailing / falling back
A development of a building or hard standing development (building or infrastructure), is a chain process that entails the business case, the design (concept to full design development), the making of (execution), the commissioning, certification cycle, its operational life and what today is considered
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very important i.e., the re-purposing or disposing element. Quite complex to say the least. Therefore, skills and competencies differ along the life cycle of a ‘building’ and so are the skills and competencies required by the ‘operator’ working at the different stages of the cycle.
Within the above context, the criteria in terms of requirements (competencies), need to be clearly established and improved and this concurrent to any licensing process. The current national occupational skills specific to our industry are considered outdated ‘big time’, and do not represent faithfully today’s industry. Therefore, skills and educational programmes should be improved and implemented in a timely manner with licensed operators required to upscale their standards in a timely and reasonable manner. The licensing process needs to work concurrent with the equivalent skill card process. In our opinion, the skill card needs to become mandatory and aligned to the licensing regime. One cannot work without the other. In simple terms:
1. A contractor who wants to operate within the industry must attain and maintain a license (equivalent to the specialisation area).
2. A worker who wants to work within the industry and employ himself or herself with the contractor, has to attain and maintain the respective skill card. (If the worker wants to operate as a ‘self-employed’ or ‘single person contractor’, he or she would have to have both the skill card and license in place.
Effectively, doing so would mean that the skills aspect is elevated and upscaled to appropriate levels through adequate and updated courses, whilst the contractor (operator) would have surety that the supply of workers is realistically available and is readily trained / certified.
Another positive aspect would be the safeguarding of the interests of both the contractor and employee when it comes to work conditions and contract of employment including mitigation parttime work that may undermine the contractors’ investment. A licensed contractor would have invested in the skills, maybe sponsored training and development of workers and therefore may align the employment contracts. Similarly, workers who conduct part-time work within the same industry, would equally require a license apart from the skill card to conduct such work as with the contractor. Same / equal level playing field to all. The end beneficiary (developer or end user) would have assurance that the contractor (entity or individual) would be licensed and have the equivalent skills
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including the capacity and resources to fulfil the obligations including liabilities that aminate from the work itself.
Therefore, emphasis should be exerted to consider:
1. The licensing would effectively work if skill cards are introduced as mandatory and concurrent to the licensing regime. The transition period should cover those contractors who are not in possession of the full requirements as expected following the last stage of the implementation of this law. Otherwise, we would end up with the majority of contractors working with a temporary license hence defeating the genuine intents of these regulations.
2. National Occupational Standards are outdated and need to reflect today’s requirements. These need to be updated, courses made available and introduced as part of the transition process. It would be more beneficial to prolong the transition process once both 1 above and the National Occupational Standards are available and launched as a full transition programme. The Country must look at how other Countries operate and regulate contractors and workers including professionals.
3. What about standards? As with the majority of other EU member states or 3rd countries, there are National Building Codes which effectively qualify / ‘dictate’ what and how the various activities are conducted. Therefore, as with the skill card and national occupational standards, the building standards need to be launched concurrently. These would effectively ‘dictate’ the required expectations especially that relative to the operator (contractor) conducting the work or works.
Specialisation & Categorisation
MCCM understands that these regulations are the beginning of a long journey and that is why MCCM insists that this first issue needs to be broadened. Therefore, as done with the demolition, excavations and construction ‘group’ licensing of contractors may include categories and classification at a very early stage It is therefore our opinion that licensing should apply for the majority of all the other trades working within industry now and not later. The regulations as drafted suggest a very basic structure and therefore the same maybe applied to include the majority of the other trades and not limit this to the demolition, excavation and structures only
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This is not a question of risks relative to the activity in terms of which activity generates the largest risks to damage or injuries or in cases deaths given that it is a given that all the construction cycle is a risk environment and therefore warrants immediate and equal treatment. It is therefore recommended to consider including all other trades / segments in lieu of what has been suggested within the current draft regulations. The following refers and provides a clear idea / proposal on how the matter maybe improved:
License Type:
1. Temporary Facilities services and installations
Effectively, this would be grouping all service providers that in reality and on a practical aspect provide services to the contractor (the contractor in such case is the specialised operator and not specialised in such services) An indication of these service providers include:
- Scaffolding, Platforms, Temporary railings, hoists etc
- Fencing, site hoarding, temporary lighting, storm water collection / utilities
- Waste management (skips, containments etc).
- Tower Cranes, mobile cranes, lifters, hi-ups
- Signage, temporary offices, toilet facilities, cleaning, containers etc.
- All that is of a temporary nature BUT anyway would need certification. In many projects even of the smaller domestic scale, facilities are in many cases done up haphazardly and become even more detrimental to safety of workers and 3rd parties. Therefore, a license together with the skill card will set the standard and the whole aspect of temporary facilities is improved. Industry is today suffering big time due to the lack of appropriate logistics planning and safeguarding of the environment. Temporary Facilities, the maintaining and management of same play an important role especially along the execution cycle.
2. Construction Enabling
- Site clearance, demolition.
- Site Investigations and Geotechnical services
- Localised excavations
- Bulk Excavations
- Piling, shoring and temporary supporting structures
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As can be seen, the above should be the minimum sub-categories whilst working within a marine environment should always be specific. Therefore, the LAND and, or MARINE should be qualified as part of this license category and classification. An operator may potentially have a license to operate bulk excavation within a Land side project scenario BUT not a sea / marine side marine project Differentiation is key.
3. Building / Construction Structure
- Traditional Masonry and in-situ concrete structures
- Non-Conventional (concrete frame structure, prefabricated concrete and masonry)
- Specialised – Hybrid including steel and other materials
- Minor construction works and alterations
4. Heritage and Restoration
Scheduled Buildings & Structures
A. Non-structural interventions
B. Structural interventions
Non-Scheduled Buildings & Structures
A. Non-structural interventions
B. Structural interventions
5. Fit-out - External Building Envelope
- Façade insulation and cladding
- Apertures including subframes as applicable.
- Railings, external balustrades and related.
- Decorative elements (non-structural) including signs, features and related.
- External rendering, pointing, plastering and paintwork.
If elements of the installation are of a structural nature than the Operator would require another license under (3) above.
6. Fit-out - Internal Building Envelope
- Floor underlay (screeds etc)
- Pointing, Plastering, Paintwork
- Suspended ceilings of a non-structural nature (gypsum, modular, timber etc).
- Floor and Wall tiling / cladding (of a non-structural nature)
- Apertures and glazing activities (non-structural)
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- Joinery including fixed joinery and decorative items (of a non-structural nature)
- Railings, balustrades etc
7. MEP Installations
- Electrical works
- Storm and Drainage systems
- Mechanical works (plumbing)
- HVAC
- Low Voltage systems
- Vertical transportation systems and escalators including non-person systems (gantry type systems and related permanent hoisting / lifting devices)
8. Landscaping
- Soft landscaping
- Hard landscaping of a non-structural nature (pools, trenches, pathways, roads, rubble walls or equivalent would be covered by another license (above).
9. Road Works covering basic infrastructure (trenching, drain and storm water culvert systems etc)
10. Maintenance and General Services
There should be a specific license to what is considered the general installer and or ‘handyman’ skill who is effectively employed by the contractor or self-employed conducting various works that vary from maintenance / preventive maintenance to replacement / upgrading and installation works (fitters etc). This would be sub-classified, say:
- Fit-out external building envelope.
- Fit-out internal building envelope.
- MEP maintenance and servicing
In all cases contractors / operators should be classified depending on the capacity to work within either:
a) Domestic nature, or
b) Mixed to commercial of the industrial nature, or
c) Both the above
Also, one should consider whether in cases of a Design and Build procurement process, the operator (contractor) would have this qualified within the specific license.
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The above might seem ‘complex’, but surely reflects the majority of the activities within today’s industry.
Being simplistic, the licensing regime may be compared to the local ‘driving license regime’ that includes categories of both the ‘driver’ and ‘vehicle’. A driver would attain license to drive a particular category, part of or all depending to the training and skills attained through adequate qualifications / testing process. Effectively, to maintain that license, he or she would mean operating within the regulations and standards through a point system with the vehicle being subject to timed testing regime (VRT) as well.
Therefore, going forward one would expect that the type of licensing is broadened as suggested above whilst categorisation is introduced backed by the appropriate credential / requirements and point system approach.
Transition Period
Considering the above observations, MCCM believes that all things being equal if one had to include / allow for the recommendation to broaden the categories, coupled with the skill card process and an improved ‘framework’ related to the credentials and point system, it would be more of value and effective to provide industry the holistic regulations reflecting the proposed regulatory framework however it may decide to enact only part of it. This way industry would have a clear indication on the overall regime and hence allowing for a transition period that is reasonable and practical.
The application process may still be launched with a ‘provisional’ license issued to all applicants (current operators) with the ‘provisional’ license covering the transition period (realistic cut-off date). The provisional license would expire once the actual license is eventually granted or cut-off date exceeded.
Link to Commencement Notification Process, Capacity and Procurement
MCCM assumes that the current commencement notification process will be totally changed within the context of a licensing process. Can BCA provide its visibility on how this would work? If the above recommendations are favourably considered, can BCA reflect this in the building commencement permitting regime? How will it work and what are the expectations? As with the PA processes, once a building is under construction, the competencies change and that is why the importance to appropriate construction management is required. Fit-out trades may impact the structure that has been built along a project’s execution cycle and hence control points would be a necessity. These observations are therefore not necessarily related to the licensing BUT an eye opener when
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considering the way the controls and compliance of a building is eventually certified. How is BCA addressing these aspects? Is the building log and depository still being considered?
The licensing would surely impact procurement processes. Whilst MCCM believes that all Governmental contracts would eventually request licensing as a mandatory requisite to participate in procurement processes, the private sector would follow suite otherwise it would act illegally. The broadening of the categories is therefore important now as this way the sector would start to align / regulate itself as from day 1. Classification is also important within this procurement capacity notion. As for capacity, MCCM believes that categorisation or classification by capacity is indeed important. Much of the failures at the moment relative to timely execution is the fact that contractors often bid and take up works without real consideration of the timing and resource capacity. Therefore, classification in terms of capacity / thresholds is key. If this aspect is considered and read within the notion of let say a developer’s application to commence works nominating a specific operator (contractor), the regulator may provide visibility to the risk aspect at that point in time. In simple terms, we are today aware that many construction contractors have multiple concurrent sites ongoing with limited resources (accredited resources) and therefore surely something is not on and this to detriment of delays or equivalent. Therefore, capacity and acknowledging such within a license through classification is an area to be considered (if not immediate but in the close vicinity).
Decarbonisation / considerate contractor (refunds – grants etc)
MCCM looks at climate change and decarbonisation targets as an opportunity to catalyse the upscaling of the industry. We believe that the equivalent of say the UK’s ‘considerate contractor’ scheme (license) would be ideal to be considered now in all categories and classifications. Essentially, Government should potentially consider this proposal today and present it as an opportunity rather than a threat. The license could have a considerate contractor rating ingrained within it (irrespective of the category or classification) should the contractor attain the pre-determined criteria which maybe maintained as long as it proves to conduct its operations within the standards accordingly. This could be simplified if the credentials to attain and maintain the equivalent rating that would be linked to say ISO management systems including green processes and practices. What would be the benefits:
- To consider maybe tax credits to the specific operator
- To consider maybe adding points to such contractors when it comes to procurement criteria / evaluation process.
- Accredited contractors may work within highly sensitive zones such as UCAs, historically sensitive areas, marine etc.
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- Subsidies and support schemes training and development.
SECTION C – CONCLUDING COMMENTS
MCCM welcomes positively the fact that a first draft of as licensing of contractors’ regulations have been published for consultation. In fact, MCCM believes that this is the very first step to push industry to start regularising itself. That said, MCCM believes that the current draft is very basic and limited to ONLY a portion of industry’s operators and therefore is not entirely faithful to today’s realities. The current draft is considered ‘unfair’ on the operators listed within the draft regulations as all other operators would not be regularised. The starting point is seen as disproportionate amongst industry operators currently working as a contractor, it will create polarities and an unlevel playing field.
MCCM understands the priority and urgency however this should not come to the detriment of the regulation itself. MCCM firmly believes that the first issue of such regulation can be much better and tied (timing wise) to other regulations, otherwise it risks failing if kept in isolation. Therefore, within the context of improvements, MCCM feel that much more can be done as explained within this report with the main salient points summarised as follows:
1. The licensing regulations would work is tied to the skill card regulations.
2. Skill card to become mandatory and concurrent to licensing.
3. The Building Codes are equally important and should be given priority and issued in tandem or close to the equivalent transition period.
4. Broadening the license to the majority of current local trades.
5. Considerate Contractor equivalent – an opportunity.
6. Point system.
7. Link to procurement system.
8. Emphasis on Safety and Education Programmes.
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MALTA CHAMBER OF CONSTRUCTION MANAGEMENT PROFESSIONALISM, INNOVATION AND QUALITY IN CONSTRUCTION MANAGEMENT
The draft Licensing of Contractors Regulations
