Today, I met with the City Manager, Dr Ndivhoniswani Lukhwareni, the MMC for Environment and Infrastructure Services, Cllr Nico de Jager, the new MD of City Power, Mr Lerato Setshedi, the City’s Specialised Investigation Department and officials from Group Legal to secure the continued upgrade of Eldorado Park and Hopefield substations.
Earlier this year, I confirmed that a City Power contractor, appointed in 2015 to perform work at the Eldorado Park, failed to deliver on an awarded contract worth R144 million, despite receiving R66 million from the City to date.
Making matters worse, the same contractor was awarded a similar tender worth R44 million to conduct work at Hopefield Power Station. The contractor has been paid R22 million by the City to date. Despite this payment having already been made, only an estimated R1.5 million worth of work has been done.
The failure to deliver on the work has severely compromised the delivery of stable electricity to the affected communities.
Following these findings, we opened a criminal case with the South African Police Service (SAPS). Two of the contractor’s directors have since been arrested and I am pleased to announce that two City officials have been arrested and will appear in court on Monday (9 October 2017).
I have also been informed that the full report based on investigation conducted by the City’s Group Forensic Investigation Department, will be presented to me by end of next week.
I urge residents to bear with as it is likely that litigation on the matter will result.
Following my engagement with officials today, I have decided to take the following action:
- the City will host public meetings following my receipt of Forensic Investigation Department’s report in order to engage with the effected communities of its content;
- institute criminal action against all individuals and/or companies found to be involved with malpractice per the report. This includes members of the previous administration’s leadership who may be found to be implicated;
- institute civil claims against these individuals and/or companies named, including the previous administration’s leadership who may be found to be implicated;
- Institute disciplinary action against all implicated officials;
- Seek legal advice on terminating our existing relationship with the service provider; and
- Seek legal advice on the appointment of a new contractor to immediately continue with work at both substations.
Corruption and weak corporate governance in past administrations has for far too long robbed communities of much needed service delivery.
It is imperative that residents understand that that the decision to launch an investigation into the above projects was not to deny them access to services or job opportunities.
Rather, the decision is guided by the need to stop corruption which has, in fact, seriously hampered the delivery of quality services to the residents in that area.
We cannot allow shameless looting, as exhibited in these projects, to continue.
Our residents are tired of the countless power outages they experience on a monthly basis. It is also widely known that our aging electricity infrastructure has received little to no attention over the past two decades, and it is vital that we turn this sad state of affairs around.
Through the appointment of the new Managing Director for City Power, we hope to restore stability to City Power and to ensure that projects are properly managed.