Dubai contractors welcome initiative promoting labour welfare and standards

Initiative will see contractors who look after workers' welfare given preferential treatment when bidding for government work.

The Taqdeer initiative was launched on October 10, which would be the world’s first points-based awards programme that recognises excellence in welfare practices. Kamran Jebreili / AP Photo

Contractors in Dubai have welcomed the initiative recently announced by Sheikh Hamdan bin Mohammed, Crown Prince of Dubai, aimed at improving workers’ welfare.

The Taqdeer initiative was launched on October 10 by Sheikh Hamdan, who said that the system would be the world’s first points-based awards programme that recognises excellence in welfare practices.

Companies that rank highest in terms of worker welfare will be given priority when bidding for government contracts, as well as gaining a competitive advantage when bidding for international contracts, Sheikh Hamdan said.

Shailesh Jasani, finance controller at Goldline Contracting, said that he believed it would “really give a big boost to the construction industry”.

“I have been in this industry for 23 years. When you look back to what was here before, labourers used to travel in pickups. Then the government decided that proper transportation needed to be given.

“Lots of changes have been occurring, so migrant workers arriving from other countries feel that yes, this is a government that takes care of people,” he argued.

Mr Jasani said that Goldline will need to do “a little bit” of work on its own camp, which houses about 3,000 people in Muhaisnah, but added that it has been upgrading facilities at the camp over the past few years.

“There are various measures we have taken and we always try to improve on them, so that after eight, 10 or 12 hours’ work, they should have everything available for them,” he said.

Alan McCready, managing director of the fit-out contractor ISG Middle East, believes that Taqdeer will have an influence throughout the supply chain.

Although ISG Middle East only operates as a management contractor in the UAE and doesn’t carry a large workforce of its own, he said it lays down the standards and policies that its subcontractors must abide by.

Although this allows it to directly influence labour force welfare on site, its control over labour camp conditions has not been as strong until now.

“We can only recommend improvement from our subcontractors. The power we have, however, is to choose to only place new business with subcontractors and suppliers who are demonstrating that they are positively improving conditions for their workforce.

“In the future, if a potential supplier or subcontractor has a Taqdeer assessment and ranking then we will take that as a positive and factor it into the decision to place new orders,” he added.

Zhu Jianchao, a vice-president and chief engineer at China State Constructing Engineering Corporation, whose Middle East operations are based in Dubai, welcomed the focus on labour welfare but added that he did not think it would make a big difference to its operations.

He also said that he hoped the system would be designed in such a way that it avoids any negative impact on the industry.

“We need to avoid extra cost to the contractors,” he said.

Bob Flanagan, a director of Colliers’ project management and cost consultancy services arm, said that he didn’t think the initiative would have a major impact on costs.

“Firstly, the cost of labour on a typical project is around 30 per cent, so even a 5 per cent increase on labour will only give a corresponding 1 per cent increase on the overall cost of construction.

“Secondly, and more importantly, many quality contractors have already been making the financial investment in their workers’ welfare, so these costs have already been captured in current pricing and shouldn’t lead to any further consequential cost increases.”

He added that contractors who invest in worker conditions also tend to benefit from savings by having a more motivated workforce, which leads to lower recruitment costs.

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