A presidential proclamation allowing the Special Investigating Unit to probe a construction industry watchdog could open a can of worms. The proclamation grants the SIU power to investigate government contracts awarded to ineligible companies.Industry insiders say such corruption would affect municipal service delivery and lead to potholed roads and shoddily constructed housing.The SIU has been instructed to look into a variety of practices at the Construction Industry Development Board, including the awarding of gradings.The board's grading system governs how private and government construction contracts are awarded.The grading a contractor receives determines the maximum value of the projects for which it can tender. Grade 9 contractors qualify for work worth more than R130-million.The SIU has also been asked to investigate the appointment of "a panel of service providers to conduct investigations for the board".The unit is to determine whether that appointment process violated Treasury regulations.This panel, said board spokesman Kolti Molise, includes specialist forensic investigators.It was established to investigate complaints about violations of the board's code of conduct, such as fraud and corruption in awarding contracts, and to ensure that procurement systems are fair and transparent.Molise refused to comment on other questions from The Times about the SIU investigation.SIU spokesman Sefura Mongalo failed to respond to detailed questions on the investigation.According to the presidential proclamation, the SIU should investigate the "validity of construction work contracts awarded by state institutions to contractors, where these institutions relied on the unlawful or invalid registration as contractors in the register of contractors, and contractor grading designations awarded by the board to those contractors".The unit will also investigate whether board officials irregularly disseminated confidential information and the board's alleged failure to properly safeguard confidential information. The investigation goes back to 2006.Yesterday the Construction Industry Development Board welcomed the investigation, saying it had asked for it as a counter to allegations of fraud and corruption."The board simply cannot afford to ignore the potential risks associated with any fraud allegations related to its register of contractors. Fraud and corruption not only undermine the country's economy and transformation efforts, they also potentially put the lives and safety of ordinary citizens in danger as a result of poor quality infrastructure," the board's CEO, Hlengiwe Khumalo, said.Charles Wright, Stefanutti Stocks' enterprise development director, who has assisted the board in gradings, welcomed the investigation."The board is incredibly strict in granting grading applications but allegations of corruption must be investigated."He said the most serious consequence of such corruption was the collapse of municipalities' service delivery capabilities."Contractors are receiving gradings they should not be getting. The collapse of service delivery can be seen in every town, from roads falling apart to other vital infrastructure either not working or projects lying incomplete for years."Wright said that in considering a grading the board took into consideration the contractor's turnover, available capital, projects executed and details of the largest project executed."The big problem is that the board does not take into account the quality of work of contractors or their safety record." Tinus Maritz, a member of the board's advisory forum and head of Pretoria University's construction economics department, said the board raised the topic of corruption at a stakeholders meeting in Pretoria three weeks ago. "They acknowledged that [grading of contractors] is difficult to manage, especially because of fronting and fraudulent representations by contractors."The corruption, which is as bad now as it was pre-1994, is with contractors trying to secure the higher gradings needed to secure [the most valuable] tenders."He said tough economic times made it hard for emerging contractors to maintain their grading and a down-gradings had serious adverse consequences for them."The board experiences huge difficulties in monitoring the country's thousands of contractors."..