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The City of Cape Town is extremely concerned about a new phenomenon where so-called ‘development forums’ are delaying infrastructure projects intended to uplift poor communities. These rogue groupings demand, extort, and threaten City contractors who are being paid with public money to build houses and roads. 

At least one major infrastructure project has been delayed for several weeks now, at great cost to the City and ratepayers, because the City contractor is not being allowed to continue work unless the group’s demands for favours and donations are being met. 

The Stock Road infrastructure project in Philippi, which is part of the roll-out of Phase 2A of the MyCiTi bus service to the Cape Flats, came to a standstill three weeks ago. The contractor has not been permitted to return to the site to complete the last bit of work and the company has been pressured to agree to the so-called ‘development forum’ demands for a ‘legacy’. 

In the meantime, local residents from Philippi are missing out on the temporary work opportunities provided through this project.

It is not permissible for so-called ‘community leaders’, ‘forums’, or politicians to get involved with, or to demand favours from, City contractors. 

All City contracts dictate that contractors provide local residents with temporary work opportunities and on-the-job training. These processes are regulated by several City policies, as well as national legislation, to ensure that goods and services are acquired through a competitive and transparent process.

Companies who are contracted by the City are compelled to spend a certain percentage of the contract value, excluding VAT and provisional sums, on employing residents from the area where the project is taking place. 

In the case of the Stock Road project, the participation goal for employing local residents is 3% of the contract value for local labour wages. Moreover, the City can confirm that, to date, the contractor has exceeded this target by more than double, with approximately R6,7 million having been paid in wages to local residents who benefitted from temporary employment opportunities.

Importantly, City contractors must randomly obtain the names of residents from the local subcouncil jobseekers database. Residents who want to be considered for these temporary job opportunities must register with their local subcouncil and ensure that their contact details are up to date.

As for opportunities to local businesses, companies who are contracted by the City are also compelled to spend an appropriate percentage of the contract value, excluding VAT and provisional sums, on subcontracting local businesses for goods and services needed for the project in that area. The participation goal for the Stock Road project was 3,5% and, to date, the contractor has paid over R3,3 million to local businesses for the procurement of goods and services.

In general, contractors host information sessions where local subcontractors are informed of the goods and services needed. At these sessions, local business people have the opportunity to indicate their interest to submit tenders or quotations for the required work. Contractors can also advertise the need for goods and services as widely as possible, allowing local contractors to submit a tender or a quote.

While local community representatives and forums are informed of the temporary work opportunities available, community groups are not permitted to dictate their own particular requirements directly to the contractor. Likewise, no City contractor should accede to any demands imposed upon them by those claiming to represent the community. This is to ensure that the opportunities available are open to all residents and local business people and contractors, and not just to a select few.

City contractors must submit monthly reports to the City to indicate their progress on the number of temporary work opportunities created for local residents, as well as on the subcontracts issued to local businesses from the area. The City’s project managers continuously monitor the progress to ensure that the contractors comply with these conditions as stipulated in their contracts with the City. Contractors who do not meet these conditions will be penalised. 

The City cannot allow ‘forums’ to act as middlemen, or as brokers, to determine which local businesses should benefit from subcontracts. Neither can these ‘forums’ demand favours or donations from contractors, or demand that they deliver a ‘legacy’ to local communities.

Local communities benefit from the projects that are taking place within their areas in the following ways:

  • Firstly, they benefit from the projects that are being paid for by the City for the construction of houses, new roads, bus stations, and other public transport infrastructure
  • Secondly, local residents benefit from temporary work opportunities where they can earn an income
  • Thirdly, local residents benefit from on-the-job training and formal training, including life skills training, and assistance to obtain driver’s licences, that will assist them to apply for other jobs in future
  • Fourthly, local businesses benefit through subcontracts where they are being paid by the contractor to provide goods and services needed for the project

The City wants to remind communities that so-called ‘community leaders’, ‘forums’, or politicians are not permitted to engage directly with the contractors that are implementing projects in their areas. 

Residents should not allow themselves to be misled by people who are claiming to represent them, but who are actually only pursuing their own agendas for financial gain.