R4,4 million spend in Extension 8

The instruction by the premier to sidestep all legal protocols pertaining to tender and procurement procedures, to fast track service delivery to Extension 8, flies in the face of local economic empowerment, says Cope councillor, Mr Ben Mokoena.

“Never before has our council allowed a situation where it is forced to ignore its own local developers and businesses, in favour of a Johannesburg based company,” Mr Mokoena added.

Mr Mokoena says the sitting was hurriedly convened, and a majority vote saw to it that local developers were handed a raw deal.

He says the mayor was manhandled into taking this decision by the premier during the so-called Premier Coordinating Forum.

A new budget will also now have to be approved, for services for Extension 8, before the February 2015 budget adjustment period, which is a flagrant violation of the Municipal Finance management Act.

The decision may impact on the town’s clean audit outcome, since both the CFO, Ms Elmarie Wasserman, and the municipal manager, Mr Willie Fouché, indicated in a report, that changing the game plan now, would amount to unauthorized expenditure.

Since Mr Mokoena is no longer an ANC puppet, morosely following the provincial chairman’s instructions, he plans to mobilize local developers and the public at large, to protest the blockage of local job creation and the siphoning of money by outside provinces.

“It smacks of corruption,” he says in support of the DA who sought answers from the mayor on how exactly the sudden urge to prioritize water and sewer services to the tune of R4,4 million in Extension 8, was arrived at.

Other projects have been cancelled due to fast tracking services for Extension 8, with R4,4 million which had to be re-appropriated towards the immediate project.

Rand Water will be contracted to provide bulk services to Newtown to the tune of R26 million in multi-year allocations up to 2017.

In 2014/2015 period R7 million will be spent on Newtown sanitation, R3 million in 2015/2016 and another R3 million in 2016/2017.

For water installations, the municipality will pay Rand Water R4 million in 2014/2015, R3 million the next year and another R3 million for 2016/2017.

“Though Rand Water is a national government business enterprise, which can be accredited alongside the applicable legal routes, all other bidders have been effectively excluded from tendering,” Mr Fanus Roos of the DA complained.

The municipal manager, Mr Willie Fouché, talks rules, regulations and number crunching:

Yes, Mr Fouché admits, it could be that the auditor general views the re-appropriation as an unauthorized expenditure but with a budget of R1,4 billion, an amount of R4,4 million is a drop in the bucket.

The municipality received R13,5 million and R14,5 million respectively for water and sanitation as a national municipal infrastructure grant which may only be directed to where it is most needed.

The grant funds have already been committed to multi-year projects in the approved budget, and it is true that the municipality may re-appropriate funds only once a year after a mid-year financial review.

The province has identified water and sanitation as a priority mandate from municipalities, including Steve Tshwete.

Since municipalities, unlike Steve Tshwete, struggles with capacity, it was decided that Rand Water be used, and as a government enterprise, the service provider can be appointed without following the procurement framework.

“As far as I’m concerned the appointment of Rand Water was thus above board,” Mr Fouché says.

The municipality decided on fast tracking service delivery to Extension 8, in order to formalize the existing informal settlement.

“We will service the plots and relocate the people living in the present informal settlement,” Mr Fouché explains the municipality’s long term commitment.

Rand Water has already been tasked with providing water and sanitation to the tune of R11 million and R14,5 million for Newtown.

A breakdown of the re-appropriated funds for Extension 8 is as follows: R2 million from the budget for a cemetery for a rural village, R1,9 million from a budget for high mast lights for Mhluzi and R500 000 from the planning budget for a multi-purpose community centre for Somaphepha.

This will only affect the 2014/2015 budget, Mr Fouché said.