THE multibillion-rand, 27-year Tshwane House contract and the metro’s flagship Wi-Fi and broadband programmes, whose costs have escalated, are among the agreements the DA is reviewing, believing corruption was involved.
The city bled billions in irregular expenditure over several years and has become synonymous with the perils of irregular tenders.
New executive mayor Solly Msimanga fired the first warning shot on Wednesday, while DA councillor Lex Middelberg in an interview on Thursday, said: “There are actually going to be real consequences now for irregular expenditure, we will (go) … to court.”
Middelberg said the DA was focusing on four contracts.
In 2015, the municipality entered into a lease-to-own contract for Tshwane House, its new headquarters, despite objections from the council.
“It [the contract] was based on commercial rental rates that the city was paying for its rented office space in town. But the price the city was paying for its rental space was three to four times as much as that of average commercial rates,” Middelberg said.
The contract is for R5bn, which will be paid over 27 years. However, this excludes annual escalations and inflation adjustments.
The controversial Peu Capital Partners smart meter contract is also in the DA’s sights.
“The Peu contract is obviously going to be reviewed, [it] has already be declared irregular expenditure and noted as such by the auditor-general … We will start the process of recovering the nearly R3bn that was lost on the contract,” Middelberg said. The matter is in court, where the validity of Peu’s contract with the city is being challenged.
The city’s free Wi-Fi, which was supposed to cost R75m a year, but has ballooned to R400m since it was introduced in 2014, will also be up for scrutiny, as will Tshwane’s broadband service as the DA tries to untangle a web that has led to the city paying about R300m.
The Wi-Fi service has only 90,000 users, but has 1.2-million registered unique users. “It would be far cheaper to give them each a dedicated line to their homes and it would cost the city less,” Middelberg said. The DA would continue to provide the Wi-Fi, but it needed to be at a reasonable cost, he said.
ANC spokesman in Tshwane Teboho Joala challenged the DA to prove that its officials were part of any wrongdoing in the metro.
“We find it unfortunate that they (the DA) are grandstanding and threatening people on the council instead of focusing on what people want, which are services,” he said.