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eThekwini Municipality warns ‘rogue’ contractors: R162m in ‘suspicious’ claims not paid yet

Service providers looking to fleece eThekwini Metro by demanding payments for goods not delivered or for work they are not contracted to do will face an uphill battle to extract payment from the city, as it takes a hard stance against rogue contractors.

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Published Jan 3, 2022

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DURBAN - SERVICE providers looking to fleece eThekwini Metro by demanding payments for goods not delivered or for work they are not contracted to do will face an uphill battle to extract payment from the city, as it takes a hard stance against rogue contractors.

The municipality plans to defend in court close to R162 million in claims made against it from service providers, where there was suspicion that due process had not been followed.

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City officials told councillors that the claims related to service providers demanding payment when they had allegedly not delivered the goods or services or where they allegedly did work without a legally binding contract would be vigorously defended.

The city had not responded to a request from The Mercury for the details of the claims it is defending.

City officials said the metro could not reveal the exact nature of the claims or parties involved before the legitimacy of the claims were tested in court.

The revelations about these claims for payment were revealed at an executive committee meeting last month, where it emerged that the city had not paid more than R162m to service providers. The city is mandated to pay service providers within 30 days. The claims at issue extend beyond that period.

The city has made it part of its policy, in terms of a government directive, that all service providers should be paid for the work they have done on time, to avoid compromising these businesses.

IFP councillor Mdu Nkosi, who raised the issue of the outstanding payments, warned that if service providers were not paid on time they could take the metro to court and it could end up paying much more than the service providers had originally claimed, due to being in default. But Malusi Mhlongo, eThekwini Metro’s head of legal and compliance, told the committee that these matters were already in court.

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Nkosi said legitimate service providers should be paid without delay, “but those that simply work without an order number from the municipality, that is nonsense… It is something that we should not even entertain”.

DA councillor Thabani Mthethwa said there had been similar allegations in the past where contractors invaded a site, started working without a valid contract and then demanded payment.

“We are saying whether there is value for money or not in the work does not matter. Where people simply decide to enter a site and work without a valid contract in place, the municipality must never pay them because that’s what leads to irregular expenditure,” he said.

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A city official speaking on condition of anonymity said the municipality would defend the claims it suspects were not legitimate, and service providers would have to prove they were entitled to the payments.

“It is important to consider that it could be that the claim is bogus, but it could happen that the claim seems bogus because a city official failed to process an invoice on time and, when they were questioned, they tried to cover themselves by casting doubt on the claim because they did not do their jobs,” said the official.

The official said it could also be that a rogue city employee sabotaged a legitimate claim, because they were trying to squeeze that service provider for a bribe.

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Mayor Mxolisi Kaunda said he welcomed the city’s efforts to ensure that it gets value for money. However, he warned that city officials should ensure that they paid all service providers working legitimately on time.

THE MERCURY

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