Desalination Plant in Strandfontein. When the drought broke, these tenders did not have to be awarded and were cancelled as the services were no longer required. Other tenders were for various services and commodities,” Neilson said. Picture: Tracey Adams/African News Agency/ANA

Cape Town - The city has cancelled over 86 tenders valued at R5.9 billion, mostly because good rains broke the drought.

The city’s mayoral committee member for finance, Ian Neilson, said these were tenders that were cancelled, not awarded contracts.

“Tenders were cancelled for various reasons, including that some bids received were not compliant to specifications, the bid specifications were unclear, the market did not respond or there were compliance challenges.

“It amounts to 16% of tenders, but the previous two financial years were influenced markedly by the drought. One can see that in 2017/18 the number of cancelled tenders was 58; in 2018/19 it was 86 cancellations as compared with 2016/17, when the cancellations were 29 because the drought crisis persisted from early 2017 to the first quarter of 2018,” Nelson said.

By far the largest portion of the tenders that were cancelled was drought-related tenders.

“As a result of its proactive management of the drought, the city had planned emergency drought interventions such as desalination plants, desalination ships and barges, among others. When the drought broke, these tenders did not have to be awarded and were cancelled as the services were no longer required. Other tenders were for various services and commodities,” Neilson said.

Neilson admitted that the city was facing a backlog at its supply chain management directorate, but said it was managing it. The Western Cape Property Development Forum (WCPDF) has on a number of occasions expressed its concern about the underspending of capital budgets at municipal level, not least in the City of Cape Town.

Chairperson of the forum Deon van Zyl said: “It has questioned the underspending of 24% (R2.8bn) in the 2018/19 capital budget, noting that the effect of this underspending was an estimated R500million that should have been paid to labour and artisans on construction sites.

“The fact that the city could only award 61% of tenders issued confirms that there is a crisis in the supply chain management system of the city, the largest municipality in the Western Cape.”

Van Zyl said the recent presentation by the city’s supply chain management to the finance portfolio committee heightened the WCPDF’s concern regarding the city’s performance.

“In particular, our organisation is extremely concerned that the city, based on the presentation data, is failing the construction and consulting industries and is clearly not able to proactively provide infrastructure and services in a growing urban environment,” he said.

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Cape Argus