A controversial North West company with provincial government housing contracts worth almost R250-million has been implicated in tender irregularities described as “unheard of” by the provincial legislature.
One of these contracts, worth R80-million, is for the building of 2Â 000 houses in Taung following floods in March this year. North West Housing Minister Phenye Star Vilakazi reportedly told the legislature’s housing committee the project would be completed “by the beginning of winter”. So far, only 60 houses have been built in Qho village, one of 11 affected centres.
Also the subject of suspicion is that the construction company, Toro ya Africa Consultants, was awarded the Taung contract after Vilakazi had stripped the Taung municipality of its housing responsibilities.
Taung mayor Boitumelo Mahlangu said she did not know why the province had removed housing from the council’s jurisdiction and did not want to “dwell too much” on the issue.
In a report finalised in July and leaked to the Mail & Guardian, an ad hoc committee of the North West Âlegislature found that former Matlosana (Klerksdorp) mayor Jaycee Nxamakele and his municipal manager, Thupi Mokhatla, had handed Toro ya Africa bridging finance of R1,5-million in an “unheard of” violation of the housing code. Nxamakele was removed as mayor after the March local government elections and committed suicide in August.
The committee said the mayor and his deputy had “borrowed funds entrusted by province to Matlosana for a specific project and utilised the funds on their own authority to assist Toro ya Africa Consultants. This is contrary to the housing code … it is unheard of for a municipality to assist employed contractors in this way.”
The committee reported that Toro received most of its government tenders irregularly while applicants who were listed on the council supply roster were passed over and given tiny contracts. In Motlasana, listed contractor Kosh was awarded only 332 units, while another company on the roster, Let’s Trade, was awarded only 316 units, worth a total of R15-million.
The chairperson of the legislature’s housing committee, Mahlakeng Mahlakeng, said that although his committee had no direct evidence of irregularities, the Matlosana matter needed to be investigated further.
“We were alarmed by the disproportionate awarding of tenders between the three tender applicants in Matlosana. We don’t know the basis for this,” Mahlakeng said.
In addition, Toro was awarded a contract to build 2Â 125 units in Mafikeng in February last year. Interviews conducted by the M&G with householders this week indicated that the job is not going well. Residents of the town’s extension 39 this week expressed anger and frustration at the state of houses built by Toro. The company’s workers also complained that the company struggled to pay them on time, with some owed five months’ salary.
Department spokesperson Mandla Mathebula said Toro’s Matlosana and Mafikeng contracts were awarded by the relevant municipalities and that neither the provincial housing minister nor the department was involved. The department had only stepped in over the Taung contract, using its own roster, because of the council’s lack of capacity. The minister was neither a director nor a shareholder in Toro, Mathebula said.
Toro’s chairperson, Ramakgalo Letsatsi, said the North West government had only appointed his company to build the houses in Taung in May.
He said the Taung project was “running smoothly”, except that Toro had difficulty in sourcing water for building and the government had delayed payment for the job. “We bought a machine and had to dig for water ourselves and still government has not paid us for the job we have done so far,” Letsatsi said.
Who has the power?
North West Housing Minister Phenye Star Vilakazi is locked in a bitter struggle with local municipalities since he wrote to all 21 of the province’s local authorities announcing he was taking over their housing powers, writes Rapule Tabane.
As a result, the North West ANC has called a special provincial governance summit from Friday November 3 in Klerksdorp to discuss housing and intergovernmental relations, as well as the relationship between the party and government. The ANC provincial executive, provincial ministers, mayors and senior managers are expected to attend.
Last month Vilakazi wrote to 18 municipalities saying that he was appropriating their housing delivery function because it was a provincial competence. He had already taken over these powers last year from the Taung, Mafikeng and Vryburg municipalities.
But the councils are fighting the move. They believe Vilakazi will use his powers to give contracts to favoured companies, including the controversial Toro ya Africa. Vilakazi’s department has so far awarded only one contract, worth R80-million, to Toro in Taung. But suspicions linger as the company also landed big contracts from two municipalities.
Some municipalities have written back to Vilakazi demonstrating their progress in delivering housing and questioning the basis of his actions. They object saying he failed to inspect their individual progress and capacity when he issued the blanket instruction. They also fear such centralisation will hurt emerging local contractors while benefiting major construction companies.
Most resistance comes from the Southern District, which includes the municipalities of Matlosana (Klerksdorp), Potchefstroom and Merafong (Carletonville).
Some members of the ANC provincial executive are planning to use the provincial governance summit to force Vilakazi to reverse his decision. However, Vilakazi’s spokesperson, Mandla Mathebula, told the Mail & Guardian that housing was a governance issue and that he could not take instructions on it from the ANC.
In most provinces the provincial government is in charge of housing, in line with the Constitution. However, the Constitution does allow for delegation of certain powers to the municipalities. In the North West, municipalities were delegated housing functions in 2001, after the housing board was disbanded.
Mathebula said the municipalities were given those powers without an examination of their particular capacities. He added that the housing department would require all municipalities that want to be given back the housing powers to undergo an accreditation process.
“We believe the housing targets will be met if the provincial department is in charge of housing. Some municipalities could not start or complete their housing projects,” Mathebula said.