Following the loss of R1.6-million, Buffalo City Metro ratepayers could see a further R20-million go down the drain in a massive tender for the construction of RDP houses in five Mdantsane informal settlements.
A cost of R1.6-million was incurred amid delays experienced by appointed contractor Ruwacon in identifying and accessing construction sites at NU3’s Ilinge and Masibambane informal settlements as there were no settlement plans for these areas.
A further R20.4-million may have to be spent if an agreement is not reached to build two of the initial settlements as a separate project.
A report submitted to council by acting city manager Nceba Ncunyana highlighted how the city’s housing department requested funding from the Eastern Cape department of human settlements in 2011 for five informal settlements despite the absence of approved settlement plans for the areas.
In 2013 a tender was advertised and in 2014 a contractor appointed to build RDP houses for thousands of families in the Masibulele, Masibambane, Ilinge, Dacawa and Velwano informal settlements.
However, four months past the May 25 2016 deadline for the multimillion-rand project to deliver 1459 homes, no homes had been built in Dacawa and Masibulele.
In the other three settlements beneficiaries have moved into their houses. However, BCM is counting the costs in NU1’s Velwano, as of the 145 houses built there 113 have been vandalised.
“The areas do not have an approved general plan by the surveyor general, resulting in the contractor not being able to undertake any work from the inception stage of construction. This has resulted in the contractor requesting an extension of time with costs due to not having access to site,” Ncunyana said in the report concerning the zero progress made in the upgrades to Dacawa and Masibulele.
While hundreds of families wait for their houses in the two settlements, Ncunyana said: “The spatial planning and development directorate has advised that BCM is still waiting for the approval of general plans…from the surveyor general’s office and cannot confirm as to how long it would take to get the approval.”
As a remedy to avoid additional costs over the R1.6-million already lost, BCM has asked the contractor to provide:
- Termination costs for excluding Masibulele and Dacawa’s scope of works entirely from the contract;
- Stand-by costs due to not being able to access the two sites until plans are in place; or
- Costs for implementing the project as a standalone as it is not clear when the approved general plans will be in place.
“The appropriate solution that is beneficial to the municipality is to implement the project as a standalone and pay the contractor for the additional establishment.
“The contractor was also engaged in solution and requested to explain the cost of R20.4-million related to implementing the project as a standalone,” Ncunyana said, adding that the metro saw the request as “unreasonable” as the construction estimate for the outstanding work was R85-million, including VAT.
Council was told talks between BCM and Ruwacon were expected to be finalised soon in relation to the extension of time-costs and the costs to exclude Dacawa and Masibulele from the initial project. — firstname.lastname@example.org