Johannesburg - Construction “Mafia” or business forums have disrupted nine government construction sites, totalling more than R2.5 billion over the past five years, forcing some of the legitimate contractors to abandon the projects.
This was revealed by the Gauteng MEC for Human Settlements and Infrastructure Development, Lebogang Maile, in his written reply to questions by the DA’s MEC for Infrastructure Development and Property Management Alan Fuchs in the provincial legislature.
Fuchs wanted to know how many projects were disrupted by the so-called Construction Mafia or business forum. He also wanted to know the total value caused by the disruptions.
Maile pointed out that there were nine projects, mostly health care centres such as Chris Hani Baragwanath Hospital in Soweto and Dr George Mukhari Hospital, which were disrupted by the Mafia.
Detailing the amounts and institutions affected, Maile said the Randfontein Clinic was disrupted to the tune of R315 030 325.89, Phillip Moyo Clinic in Etwatwa, Benoni, by R52 192 998.64 and New Eersterust Clinic by R64 117 901.75 (The contractor eventually left the site).
The disruptions cost Dr George Mukhari Hospital R323 166 063.62, it cost Jubilee Hospital R294 082 296.63, Kopanong Hospital lost R220 774 176.35, Chris Hani Baragwanath Hospital lost R559 725 780.60, and Anglo Ashanti Hospital lost R588 594 235.41.
Asked what steps had the department had taken to deal with the extortionist activities of business forums, Maile said his department had developed an Anti-Project disruption strategy to mitigate the negative impact of business forums on the Department on Infrastructure Development’s (DID) infrastructure pipeline.
“The DID security management directorate participates in the Provincial Joint and Priority Committee Against Illicit Business Forums meetings that are convened monthly. DID concerns and challenges are raised to both committees, wherein the list of disrupted projects, hijacked properties, and land is submitted. Meetings are held regularly with the Priority Committee Against Illicit Business Forums team to prioritise the resolution of disrupted projects,” Maile said.
He said the DID security management team ensures that the department receives progress reports from the Provincial Joint Committee on all the matters pertaining to criminality on the DID projects.
Commenting on the replies, Fuchs said the disruption of projects had severely impacted service delivery and employment opportunities because hundreds of jobs could have been created through these projects.
In South Africa, the first business forums arose in KwaZulu-Natal more than 10 years ago and then spread to the rest of the country. Individuals or groups of people approach developers of infrastructure and demand to be given contracts to participate in the project.
Failure to agree had resulted in the assault of construction workers, equipment on site being damaged, projects being halted or even deaths.
Fuchs said procurement regulations promulgated in 2017 made it obligatory on projects in the public sector over R30 million for subcontracts to be awarded to designated individuals to promote local economic development.
He said the unintended consequences of this had been a scramble by SMMEs to participate in these tenders and an attempt by business forums to intimidate the SMMEs as well as developers.
“The fact that this legislation is only applicable to the public sector has not stopped the construction mafia from demanding subcontracts and disrupting projects in the private sector,” Fuchs said.
He, however, said that the government’s reaction to this criminality had been underwhelming, with South African Police often refusing to intervene.
“The Infrastructure Department indicates that it has set up a project anti-disruption strategy. In addition, its security management directorate has regular meetings with the Priority Committee Against Illicit Business Forum.
“There is no expectation that the dysfunctional Gauteng Department of Infrastructure will be able to deal decisively with this scourge, and undertakings from them are met with scepticism,” he said.
Fuchs further said: Hope and trust in government have been eroded. Surely, it’s time for a change in government that will stop the construction mafia and prioritise the completion of projects to ensure uninterrupted service delivery and create employment opportunities.”