Date: 16 September 2021

Tabelo
Amabhungane

HEADING: FOLLOW UP ARTICLE ON THE A-WMS 11-15 WASTE MANAGEMENT CONTRACT

I trust you are well and keeping safe . I am writing a follow up article on the A-WMS 11-15 waste
management contract relating to the 2018 Audit and Risk Management Solutions forensic report, which
the municipality forwarded to us as part of our Promotion of Access to Information Act application. The
article will be particularly based on the MCC/Before Dawn JV in Tembisa/Daveyton. Could you answer
the following questions?

1. According to the forensic report the municipal manager commissioned the

investigation…is this true if yes what action did she take after receiving the outcomes of
the probe and recommendations?

Indeed, the City Manager commissioned the investigation and recommendations were dealt
with according to our internal systems.

2. The report found that the contract between MCC/Before Dawn JV and the Community
Based Contractors was one of employment not a subcontractor - From the contracts
amaBhungane have seen this arrangement remained the contracts were never changed-
did the municipality ever saw these contracts between the DCs and CBCs to make sure
there was compliance?

The Department has seen this and it is in line with the definition under Form I clause3.
Definitions ii) page 52. The CBC is an independent Sub-Contractor.

2.1 Why did the municipality allow Development Contractors to have different contracts or
interpret the scope and objectives of the project differently meanwhile there was a tender
specification detailing exactly what was required?

The service providers were appointed in different areas with different quantities and rates.
The different contracts with the CBCs were in line with the Tender requirements. The City
had a contractual relationship with the Development Contractor and did not have any
direct contractual relationship with the CBCs.
2.1.1 On what basis did the municipality award this tender in the first place if the Development
contractors did not meet the criteria on some aspects, if the spec changed surely there
should have been re-advertisement because this means other prospective bidders were
disadvantaged?

The contract was awarded through the approved formal procurement process and there
was no change of scope. The Service Level Aggrements between the City and the
Development contractors provided clarity on the matter as the Specs are generic and not
area specific.

3. The forensic report also found that municipality overpaid the JV R 7,6 million for non-
existent service points- did the municipality ever recover this money, if yes please give
details?

There was a count of the service points and everything was found to be done in line with
the SLA. There was no overpayment but instead the municipality saved money in this regard.

4. On page 23 under executive summary, the report states, “We concluded that money paid
for the management fees services by the development contractors is fixed and does go to
the Development Contractor and that the money collected for services rendered by the
Community Based Contractor is appropriated by the Development contractor. We
calculated that in Tembisa area, each Community Based Contractor will be owed R2 690
119,14 on average by the Development Contractor.” Did the municipality investigate this
outcome, if yes what actions were taken?

The City has made all payments for services rendered in line with the approved contract.

5. The audit firm also reviewed the system in place to manage the contract and found out
that there were inadequate resources allocated internally for the proper supervision of
the implementation of the contract no. A-WMS 11- 2015 and recommended that adequate
resources be allocated for Project Management and Monitoring- was this done?

The recommendations were noted and the supervision and monitoring staff has been
included on the approved structure.

5.1 Several CBC’s and recyclers alleged that their complaints on how they were being short
changed on this contract fell on deaf ears- what is your comment did the municipality
intervene if yes how?

The CBCs and recyclers had a direct contract with the Development Contractors and not the
City.

5.1.1 On this contract A-WMS 11- 2015 how much was budgeted for the recycling
programme.

There was no specific budget allocated for the recycling programme.

5.2 AmaBhungane were forwarded several documents as a result of our PAIA application
minutes of meeting between officials and Development contractors but not minutes
between officials and CBCs why?
 As previously explained, the City did not have a direct contract with the CBCs and it was not
a requirement in terms of the contract.

6. As the municipality and custodian of this project have you made any follow ups with the
CBCs and recyclers to assess whether the goals of empowerment were reached if yes, what
is your assessment. If not why not?

The assessment was done on an annual basis to ensure that the goals of the City are
achieved and we are satisfied with the progress recorded.

7. When is the municipality appointing service providers for the new tender – if appointment
has been made please give details such as when and can we get a list of winning bidders?

The appointment process has not been concluded as yet. Once completed, the
appointments shall be made.

8. It has also come to our attention that all refuse collection service providers in the Kathorus
areas withdrew their trucks last week Thursday due to non-payment. They have not been
paid since July and they are still owed payments (for May and June) from the previous
financial year. What is your comment?

The City pays the service providers for all work that has been performed as approved by the
Department. All approved invoices are submitted and processed for payment by the Finance
Department.

End

For more information, media may contact Spokesperson Zweli Dlamini on 082 573 6464 or
zweli.dlamini@ekurhuleni.gov.za

Issued by

Nhlanhla Cebekhulu
Divisional Head: Communication and Media Relations
City of Ekurhuleni
Department; Communications and Brand Management
Address; OR Tambo Government Precinct Building
Corner Cross and Rose Street, Germiston, 1400
Third Floor

Tel; 011 999 0067

Website; www.ekurhuleni.gov.za
Facebook; City of Ekurhuleni
Twitter; @City_Ekurhuleni