Durban - The eThekwini municipality spent almost 40% more than it should have on a 700-unit transit camp in Kennedy Road in 2014.
The municipality spent R31.5 million on the temporary housing structures after fire gutted several shacks in the area, and the municipal public accounts committee questioned the value of the tender, as about R35 000 had been spent on each 2.8m x 2.8m room in the camp.
Permanent structures could have been built for about the same price.
The adjoining rooms were built in batches of between two and 10 structures - with the wall of one forming the wall of the next room.
The accounts committee queries triggered a KPMG investigation.
According to the KPMG investigation report, which is yet to be tabled before the municipality's full council but which The Mercury has seen, city officials are largely to blame.
Tauris Garden Trading 500, the company awarded the contract, previously told The Mercury that it could not comment on an "ongoing investigation".
Asked this week about the accounts committee report tabled before exco, which raised concerns about shoddy workmanship and value for money, the company said: "Unfortunately, we have not seen the report that you refer to. Our full scope entailed specialised material and site civil construction. We do not believe that we do shoddy workmanship, as all works done are certified by professional project managers, engineers etc."
Approached for comment, the metro's head of communications, Tozi Mthethwa, said the city could not comment as the report had not yet been tabled before the council.
The KPMG report recommends the city investigate whether officials should be held accountable for failing to make public proper specifications for the project.
The lack of details in a bill of quantities led to six contractors tendering very different pricing for the job.
Three quoted between R23.1 million and R24.4 million, while the other three quoted R7.8 million and below.
AKRT Investments, Tauris Garden Trading and Taset 13, which were subject to the KPMG investigation because of allegations of collusive practices, all tendered above R20 million, while Mashalofu, Kwavela Ukukhanya and RGZ Projects had much lower quotes.
After a determination of tender adjudication points, the bid adjudication committee decided to award the contract to Taset 13. It appeared that those below R10 million were not considered.
The bid committee later adjusted the Construction Industry Development Board grading to a higher one.
This led to the contract's being awarded to Tauris Garden Trading 500 CC.
Independent quantity surveyor Ukuza Consulting, hired by KPMG to price the same work, found the estimated value of the "superstructure" was about R17.2 million, excluding vat. This was 39.33%, or R7.7 million (including VAT) less than the price quoted by Tauris Garden Trading.
The KPMG report said the project was prejudiced by the lack of a proper bill of quantities document which led to disparities in quotes.
The bill of quantities document merely stated: "All materials as per market-related rates," without any details about what was to be built.
The report recommended that the extra R7.7 million spent by the municipality should be declared as wasteful expenditure and the city should investigate whether officials should be held accountable.
The report also stated that the city should investigate how the companies that tendered calculated the tender values without the information.
Other glaring irregularities or omissions in contracts picked up by the KPMG investigators in other multimillion projects awarded by the municipality include:
* Recommending that a contract be awarded when no price for the work had been correctly submitted.
* Different amounts for the number of houses appearing on bills of quantities and tender documents.
* Splitting projects, thereby removing the requirement for Construction Industry Development Board gradings and for the projects being registered with the National Home Builders' Registration Council.
The Mercury