The speech below was delivered by Martin Meyer, MPL during an IFP Motion debate in the KZN Legislature today
The Democratic Alliance (DA) welcomes today’s IFP Motion. It is important for Members of the Legislature to debate, discuss and establish best practice in order to create a capable and ethical state in KwaZulu-Natal (KZN).
As a servant of the people of KZN, there are basic principles that I live by in the execution of my duties as MEC for Public Works and Infrastructure. These include:
• Everything the Department of Public Works and Infrastructure (DPWI) does must serve the people of our province
• While, as MEC, I am responsible for the money my department receives, but it is not my money and it is not government’s money. It belongs to KZN’s people and I am responsible to them for how it is spent and for ensuring that it benefits them
• Government can and must provide good quality infrastructure to KZN’s people in an equal and responsible manner. It must provide facilities they can be proud of. And when government builds a clinic or a school in rural uMzinyathi, there is no reason that clinic or school should not look the same as a clinic or school built in KZN’s metro, or more affluent suburbs and;
• While the DPWI is focussed on building beneficial and lasting partnerships – and treating contractors that work with us as full and equal partners – we will not partner with organisations or people that do not share our values as stated earlier.
It is with these values in mind that KZN’s DPWI took a long, hard and serious look at the work being done by its contractors in the building environment. And there can be no doubt that the majority of contractors also want to be proud of the work they do and are partners in our mission to build KZN better. They have stuck with us through the payment crisis and they have supported us on our difficult road to cleaning up the DPWI and its image. Our relationship with these contractors is of great importance to us.
However, there is a small minority of contractors who are not honest, who do not provide good quality work, and who do not put the people of our province first.
As a Government of Provincial Unity (GPU) on a mission to improve service delivery to KZN’s people, we need to pick our partners better. Contractors who take money that belongs to the people and disappear from site, with very little work done, are not contractors we want to partner with. Contractors that lie about their skillsets, or about the professionals they employ – and are therefore unable to deliver quality projects – are not contractors we want to partner with. When contractors build a bathroom, where sewage water comes out of the taps or roofs fall in after a month, where the walls are not sealed, are not contractors we want to partner with.
KZN’s GPU – and by extension the DPWI – also have a responsibility to the people of our province to ensure that contractors that act in bad faith are not awarded tenders within other provincial government departments or provinces. It is for this reason that the DPWI will institute section 23.4 of the Provincial Finance Management Act (PFMA), Instruction No 03 of 2021/2022 (6.1), which confers powers to the Accounting Officer (AO) as follows:
6.1 The AO/AA must, in writing, notify a person of –
(a) the intention to restrict the person from doing business with the State;
(b) the grounds for the restriction;
(c) the intended period of restriction, which may not exceed ten years; and
(d) the right to make representations within 14 days as to why the person should not be restricted.
In line with the PFMA, the DPWI will allow contractors to provide their reasons as to why we should not implement the restriction, often referred to as black-listing, while there is also an appeal process. There are many instances where the DPWI has initiated restriction processes and where – after receiving answers from contractors – we have not implemented restrictions. Fairness is also an important value within the department.
Some examples of reasons given by contractors which have led to not instituting restrictions include:
• Price escalations. The DPWI takes time to issue letters of appointment and prices from suppliers are only valid for a certain period
• Payment delays by the DPWI, which hinder on site services
• Businesses suffering massive financial constraints during the COVID-19 pandemic, with many that have never fully recovered and;
• In the event that a company owner has passed away, in which case the DPWI is redirected to the executors of the deceased estate.
The DPWI is currently instituting restrictions on six contractors, four of which are also doing work for KZN’s Department of Education and two for the province’s Department of Health. The reasons for the restrictions are as follows:
• Abandoning site
• Poor workmanship
• Poor project scoping and costing
• Inadequate experience of human resources on-site and;
• Poor cash flow management
While these restrictions come at great cost to the DPWI, they come at an even greater cost to the people of our province. They also escalate costs and slow down service delivery. As MEC, it infuriates me when I go to a project which is on its second or even third contractor, for the above reasons. It means the project is running over time, and over budget. Under the KZN GPU, the DPWI is committed to completing projects on time and within budget. This is what the people of KZN are rightly demanding and it is what they deserve.
The days of certain individuals acting in their own best interests, rather than those of the people, or taking the department for a ride, are over. The DPWI will only partner with honest, capable contractors and will act against those who want to take the people’s money and run.
The DPWI is also a department that listens. We have started a Contractors Imbizo, a first of its kind, as we wanted to hear their concerns. Some of the suggestions brought to us have already been instituted. These include advertising all our tenders, even the small ones, online and having our site meetings on a hybrid model. The DPWI is also bringing SARS, CIPD, banks and other role players to the imbizos to empower our contractors.
Contractors have also, quite rightly, raised the matter of late payment, for which the department has had a terrible track record. But the DPWI, under KZN’s GPU, has acted and the results can be seen. By working with our other important partners, our client departments, we have cut inter-departmental debt owed to the DPWI by hundreds of millions of rands, allowing us to release monies owed to contractors. We have paid more than R500million to contractors over the last few months for work completed and we are working tirelessly to ensure our goal of payment within 30 days. We are also working with provincial Treasury to ringfence infrastructure money from departments and I wish to thank KZN’s MECs for their assistance in this regard, in particular Finance MEC, Francois Rodgers and Education MEC, Sipho Hlomuka.
KZN’s GPU is working, together, for the people. We want our contractors to succeed, but more than that, we want to build KZN better, together.