Durban — Just days after eThekwini Municipality was forced to pay R6.6 million in interest, accrued because of the City’s failure to pay a service provider, the City could be forced to part ways with R62 million in interest for owing another service provider for more than four years.
The R6.6m was part of a close to R500m tender the City had awarded to supply electricity smart meters.
In the half-a-billion-rand matter, a security company that has done work for the City has threatened to go to court if the City does not immediately pay the money owed to the company.
On September 8, Solbeth Protection and Risk Management wrote to the City’s Executive Committee demanding the immediate payment of R413 161 463 which includes R62.8m interest, which the company said was ignored by Exco.
On Thursday last week, the company wrote another letter which it said was also ignored by Exco.
On Sunday the company’s chief executive, advocate Siyabonga Xulu, said he texted eThekwini mayor Cyril Xaba reminding him about the payment. However, he said he had not yet responded.
In the letter seen by the Daily News, the company wrote: “We write with a great deal of pain, disappointment and lack of commitment that we have since received from the City Manager’s Office led by Mr Musa Mbhele. Our Risk Management company is owned (sic) a shocking amount of about R413 161 463 which includes interest of R62 815 858.
“This is for the emergency services that were rendered in ensuring the safety of municipality staff, communication channels and various safety-related services.
“It is a regrettable action that has been done by eThekwini Municipality despite all the lifesaving activities that have since been given from several years ago. It has been a painful period of almost four and a half years since our appointment by eThekwini Municipality,” read the letter.
Speaking to the paper on Wednesday, Xulu said he had given the City enough time to settle the debt and the time had lapsed, so he would file court papers to force the City to pay his money.
Xulu said the debt started accumulating in 2019 after his company was appointed by then-city manager Sipho Nzuza, who asked for his services after discovering that his life was in danger. However, his attempts to get his payment had not been successful which was why he felt that he must go to court.
“My appeal to the Exco was the last resort to reach an amicable settlement. I am disappointed with how the Exco has handled the matter, therefore I see no other option than to go to court,” said Xulu.
On why he had taken so long to do so, he said it was because the matter involved the security and safety of senior officials of the City. Going to court would expose them to danger since he would have to give details of the security services his company provided to the City and its staff.
Xulu said once the matter was in court, it became public information. Therefore, the public would know security details, including what secret security surveillance equipment he planted in the City’s offices and the homes of officials. He said part of his company was debugging and sweeping the offices and homes of officials.
The paper has seen several correspondences between Xulu, former city manager Sipho Nzuza and current city manager Musa Mbhele discussing the matter.
Nzuza said he would not want to get entangled in the internal affairs of the City since he was no longer part of the management, saying he advised Xulu to take the matter to court.
Nzuza’s sentiments were shared by an Exco member who spoke to the paper on condition of anonymity since he was not authorised to speak to the media about this matter.
The Exco member said it would be difficult for the Exco to discuss the matter since there was no report, and that the only thing it could do would be to refer the matter for investigation which might take long.
He said the best advice for Xulu was to go to court, adding that this would not only assist him in getting his money but also the City since it would trigger an investigation into whether due processes were followed in awarding the tender to Xulu’s company. If not, who must account for it as well as whether officials who personally benefited from the company’s services did so procedurally or not.
eThekwini Municipality spokesperson Gugu Sisilana said, “Since the letter is addressed to the City’s Executive Committee, we can confirm that the Executive Committee is seized with the matter. As such, the Executive Committee will deal with it as it sees fit. The Executive Committee will also be guided by legal advice since this matter is in court.”
Weighing in on the matter, legal and economy expert Professor Bonke Dumisa said it was a serious governance problem when the municipality incurred such huge amounts of interest for not paying service providers on time, calling for heads to roll.
He said consequence management must be applied because the interest was clearly a wasteful expenditure. It will have a ripple effect on delivering services to the people, he said.
He called on Xaba to immediately fix these problems before they tainted his good integrity.
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Daily News