Council acts as deadlines for construction ignored

THE CITY of Joburg is stamping its authority on construction contractors failing to meet deadlines and escalating prices.

The CoJ has announced a new clause allowing for early termination of contracts. The special clause has been incorporated into the new set of standard construction tender contracts.

This comes after the Johannesburg Development Agency (JDA), a CoJ entity, was recently forced to terminate four contracts for poor performance by contractors working on projects: the multimillionrand Nancefield Transit-Orientated Development, the Langlaagte Pharmacy Depot, Thoko Ngoma Clinic and the Rabie Ridge Sports Centre.

According to the 2015/16 integrated annual report, delays in the Langlaagte Pharmacy Depot development were due to an unexplained “township establishment process”. The Nancefield Transit-Orientated Development was a project identified by the city “as part of an initiative aimed at creating a restructured space economy that gives poor households better access to well-located accommodation, jobs and markets”.

In a statement, the MMC for development planning, Funzela Ngobeni, said “investigations had found that issues related to cash flow, which affected production and the quality of work, were evident in all four projects.

“It became clear that the contractors over-stretched their resources, and in many instances, used money allocated to the JDA to cross-fund other projects,” he said.

If contractors failed to reach milestones as per the timelines set, Ngobeni said, “the new clause will be implemented to terminate any contractual agreements”.

“The projects were planned for completion between September and November 2016, but their contractors failed to meet the agreed completion date. The JDA subsequently terminated the contracts.”

Ngobeni added that further to the projects being delayed, the costs to complete them had increased by at least R49 million “due to cost escalation and some poor-quality work done by the previous contractors”.

“New contractors have been appointed to the projects and commenced with the project in March and April 2017,” he said. The projects were now expected to be completed in August this year.

“It needs to be stated that there is a need to review industry-based contracts. This will mean that contractual performance and terms of termination based on specific project timelines will become a reality.”