Gauteng / 5 September 2016, 12:11pm / KENNEDY MUDZULI
Pretoria - Rated among the black sheep of Tshwane’s past ANC regime, the city’s cancelled smart meters contract is among the large-scale projects to be reviewed by the new DA-led administration.
The contract has been under investigation by the public protector for some time, and is on the radar of both the national and provincial Co-operative Governance and Traditional Affairs departments.
To avoid parallel efforts, the departments halted their investigations and opted to wait for the conclusion of the probe by the public protector, the report of which is pending.
Charges were previously laid with the police against former mayor Kgosientso Ramokgopa and recently-departed municipal manager Jason Ngobeni.
New executive mayor Solly Msimanga of the DA set the cat among the pigeons when he told the council he would review a number of large-scale projects undertaken by the former leadership of the city.
“I have five reports; these are forensic reports suppressed for the longest of time... If you think that everything was swept under the carpet you have another think coming...” he said.
On Sunday, the city’s former smart meter service provider, Peu Capital Partners, said it welcomed the imminent review of the contract it signed with the city in 2013.
The deal was terminated in May last year, with the city saying it was drilling a hole in its coffers and blaming this on a court interdict by AfriBusiness which, it said, prevented the city from reaping the full reward of its relationship with Peu.
“We appreciate this as an opportunity to brief the new leadership of the city, and cut through some of the misrepresentation and myths that have developed since the contract was signed,” Peu chairman Peter Malungani said.
“Most of the discussions about the contract have taken place in court. We believe a broader conversation will help to provide a full understanding of the prepaid smart meter initiative and its benefits for the city, and reassurance around our commitment to good corporate governance.”
Malungani said Peu strongly disputed some of the perceptions created and was keen to talk the city’s new leadership through all aspects of the contract
He said Peu had followed all processes set out by the city and received contractual warranties and assurances that due process was followed in the awarding of the contract.
“The comments that the city lost money on the contract are not correct and should be viewed against the backdrop that Tshwane has seen significant cash flow benefits since prepaid smart meters were introduced.
“The city has received around R14 billion in revenue from upfront electricity sales, and gets an average prepaid cash balance of approximately R300 million every month,” he said.
At the time of termination, almost 13 000 meters had already been installed, payments of R830m made to the service provider in terms of the master services agreement.
Peu has continued to service the customers already on prepaid, albeit for a reduced fee.
In July, the city was interdicted from making a payment of R950m to Peu, pending the review of the contract. It also emerged that the city had appointed Accenture South Africa as its new smart meter service provider.