No irregularities in R1.1bn tenders - Rand Water

23 November 2016

Cape Town - There were no irregularities in the R1.1bn tenders awarded to one company by Rand Water, Parliament heard on Wednesday.

This after reports that the country’s biggest water utility, which supplies Gauteng and parts of Mpumalanga and Free State, was paying millions more for work that was not being completed.

The City Press on Sunday, October 30 reported that Rand Water had handed over R1.1bn in tenders to Fast Move Electrical, which was battling to complete the work.

The company was also paid R56m in advance for work that was not completed, it was reported.

Fast Move Electrical is owned by businessman Osfael Vusumuzi Mazibuko, who is Zimbabwe-born and "little known", according to City Press.

But Rand Water went on the offensive in Parliament on Wednesday when they briefed the water and sanitation committee on the allegations.

Board chairperson Faith Hashatse rubbished claims that there was anything irregular about the tenders, calling the story "innuendos".

They could not find information to corroborate the report, she told the committee, and they could only deal with what was in front of them as they could not go to the source.

'Not unusual'

Hashatse told the committee that the company had received R1.1bn in tenders, over the course of five years, "which was not unusual".

"These are multiple projects awarded over five years. This is something that would not be unusual within the space that we operate in, and would not be unique to Fast Move. There are other companies that do business within this space that get repeat work from Rand Water, and this has been so for a long time. This is also partly because this is a specialised space."

Defending the advance payments, she said they had a sound system of checks and balances before a payment was made.

Advance payments were made, she said, in keeping with contractual agreements. In one case, the progress payment was made after the delivery of a pump manufactured in Germany.

The advance payments were the most explainable part of their report, she said, and they would stand if audited.

The company had been in business for 20 years, the committee was told, and the owner was South African according to his identity document and the information they had.

But Hashatse said she could not be sure if he was a naturalised citizen or not.

They had gone through the proper processes, she insisted, and there was no sign of any wrongdoing in the contracts.

One of the contracts in question relates to a R490m project to design and build an engine room and reservoir at the Zuikerbosch Pumping Station in Vereeniging.

Rand Water CEO Percy Sechemane said work had already started on the project, and that they were looking at making their 2018 deadline.

While the contract was awarded in 2015, he said, they had only started the work in 2016 due to civil unrest in the area.

"People were demanding jobs and contractors wanted to be sub-contracted. We officially started in June 2016. We are on site, we are close to finalising the excavations," he said when questioned by the MPs.

Report slammed

The board and some of the committee members slammed some media reports as "belittling of black companies".

Hashatse said they had responded to the City Press, and given their side of the story, but that it was ignored in the report.

Committee chairperson Lulu Johnson referred to the media as a "special kind of animal", and said it was a concern to see how black companies were “really rubbished”.

Economic Freedom Fighters MP Makoti Khawula said the report had not given them enough information to decide if there had been any wrongdoing on the part of the water utility.

"It’s an insult to us," she said.

One MP called for media to be engaged, as they provided oversight between legislators and the public.

Rand Water should answer on each and every allegation and question levelled against them, MPs said, so that the public could have peace of mind.

This article first appeared on News24, see here.