Secret process 'just tip of a dirty iceberg'

By Dominique Herman

It cost the City of Cape Town R13,6-million to complete the shoddy work on a R25-million tender that was awarded to BTH Construction in 2003 for road works in disadvantaged areas.

This was confirmed on Wednesday by councillor for transport, roads and stormwater (TRS), Danile Landingwe, who has come under fire for allegedly interfering in the awarding of the tender in BTH's favour.

He said the city had cancelled BTH's contract and Vula Inndlela and Darson Construction were paid R7,5-million and R6,1-million respectively to finish the job.

Landingwe added that a report he received in June noted that BTH had not completed 60 percent of the work they were supposed to have done, and the 40 percent they had completed, was riddled with defects due to "poor construction".

Darson Construction had originally been recommended in a report to the tender and procurement committee, and the mayoral committee (Mayco) by Mark Bondietti from the city's TRS directorate.

His remark read: "That the tender submitted by Darson Construction in the total amount of R11 124 004,27 for the construction of concrete roads in Gugulethu Phase 2, be accepted".

The report also noted that Darson had a higher HDI equity ownership than that of BTH, and the total adjudication points awarded to Darson were 95,55 as opposed to BTH's 94,90. Despite this, Mayco changed the preferred tenderer to BTH.

A senior council employee and reliable source who did not want to be named, told the Cape Times the director of transport for the city, Maddie Mazaza, was put under pressure to repay retention and surety money to BTH - between five percent and 10 percent of the total tender amount - even though the company had not fulfilled its obligation.

He said that in instances like this when a project collapsed, surety and retention was kept by the city.

Executive director for transport, roads and planning, Mike Marsden, said that under the normal course of events, the retention and guarantee was repaid to a company after 12 months if the work stood up to standards.

In BTH's case, the city had performed an independent investigation to assess council's risk and determine what council's exposure was in terms of cost.

They had then quantified that in terms of BTH's retention and guarantee. This information had been put in a termination of contract proposal to BTH, but BTH had not yet come back to them, he said.

He would not reveal what the proposed amount to be refunded was, but said it would probably be a "considerable reduction" of BTH's retention and guarantee.

Meanwhile, the Democratic Alliance sent a proposal to new local government and housing MEC Richard Dyantyi to set up a commission of inquiry with powers to take evidence under oath from the politicians named in the BTH report, and to establish the truth behind allegations of criminal acts by the ANC.

Councillor Belinda Walker said at a press conference on Wednesday that the DA called on the city manager to publish immediately the report compiled by the city's forensic investigative audit division (FIA) on irregularities in the BTH tender award - of which the Cape Times published details.

She said she had requested a copy of the report but that the city manager had "absolutely refused" to provide it.

The report is based only on evidence given by city officials and administrators, as the FIA does not have powers to investigate politicians.

If Landingwe did interfere in the tender process - as has been purported in the FIA report - then that would be a "potentially criminal offence" as it would be violating the clearly laid down code of conduct for municipal officials, she said.

As well as being precluded from participating, politicians could also no longer even observe the tender procurement decision-making process. Everything - from the gender of the participants to the minutes - was kept secret, said Walker.

"This is the tip of a very large and dirty iceberg," she said.

DA councillor Ian Neilson said the response of the mayor, Nomaindia Mfeketo, to allegations of corruption with regards to the awarding of the BTH tender - that the city had followed "due process" - was an insufficient response.

"They're manipulating the process at every turn. The real checks and balances have been removed," he said.


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