School builders frustrated

Late payments threat to firms

WITH sub-contractors and suppliers snapping at their feet, some KZN builders are becoming increasingly frustrated – and worried – about their own outstanding payments for the schools they had been building.

“I owe my suppliers about R1 million and I am being sued by some, but I, in turn, am owed about R4 million,” said one angry builder, who did not want his name disclosed for fear of losing future work.

As a result of not being paid, he has had to down tools at the sites, the local labour force is out of work and the rural schools remain unfinished. However, costs are still being incurred at the sites where pre-ordered materials are being delivered and security is still needed.

Over the years, some builders have gone out of business while waiting for payment, the builder said, adding that he and others had taken over projects where a previous builder had gone bankrupt.

He said that although he had recently received a part-pay- ment, he was still out of pocket and has had to use the funds to ward off suppliers and sub-contractors who are threatening to take him to court.

Contracts

The work is commissioned by the Department of Public Works and implementing agents (Coega and IDT, the Independent Development Trust) that act on behalf of the Department of Education. The builders’ contracts are with these agents.

All work that has been done has to be measured and signed off by a quantity surveyor/ principal agent and a representative of the implementing agent on site. The builder then submits his invoice.

Another builder, who is also working on several school contracts and is awaiting payments, said he did not want to be named as it would be “business suicide”.

The KZN branch of the Master Builders’ Association said the non-payment of builders was a “serious issue”, and it confirmed that some businesses had closed.

“The problem is that the implementing agent is not receiving funding from the Department of Works and Department of Education and they’re not receiving it from the national budget,” said Ross Stembridge of the association.

He said they had written to Belinda Scott, the provincial MEC for Finance, requesting a meeting. Scott recently called for companies to be paid within 30 days.

Speaking generally, Dr Ayanda Vilakazi, the head of marketing and communication for Coega, said that sometimes, a contractor missed a step when making out an invoice in a rush to get it through for payment. The two contractors the Daily News spoke to disputed this.

Vilakazi said another reason that payment may not have been made was because some work may not have been done correctly, and corrective measures had to be put in place.

The Daily News was unable to contact a spokesman for the IDT.

A Department of Education spokesman said builders who had records of what was owed could submit their details and information to the internal finance office so they could intervene and try to assist.