Contractor non-performance stalls infrastructure projects to the value of R231 million

17 March 2020

The Democratic Alliance (DA) in Gauteng is concerned that infrastructure projects to the value of R231 million have come to a standstill as a result of contractor non-performance.

In the context of infrastructure development, projects fail or come to a standstill because of the inability of the contractors to perform.

This lack of performance is due to a lack of technical expertise, experience, or in some cases insufficient financial resources for the contractors to sustain their businesses or operations. The latter problem is exacerbated by the inability of government to pay the contractors within 30 days as is required by law.

The fact that these projects take longer to implement than what was originally projected leads to the opportunity cost of service delivery being delayed.

The longer than projected timelines contribute towards the direct cost of projects becoming inflated. The opportunity cost and the increased direct cost is the premium that is paid to cover for contractor non-performance.

There are those who have no objection to taxpayers having to pay for the inexperience or lack of expertise.

The DA will be closely monitoring to see whether measures have been put in place to get these stalled projects back on track.

Issued by Alan Fuchs,DA Gauteng Shadow MEC for Infrastructure Development and Property Management, 17 March 2020