Companies milking the municipality will be given the boot

Before the end of his term, Cllr Jerry Sibiya wants to rescue the municipality and ease the financial pressure on Vryheid's residents.

ABAQULUSI mayor, Jerry Sibiya, has voiced his commitment to rid the municipality of companies that are “Milking the cow that has not been fed.”

It is believed that LK Security Solutions, the company that has been rendering security services for AbaQulusi since July last year, may be the first to go.

Cllr Sibiya admitted that the municipality had been paying more towards contracts for outsourced services than it received in actual income.

“When the former acting municipal manager, Bongiwe Mnikathi, left AbaQulusi, we had a deficit of about R86 million. We have managed to reduce that deficit to R59 million, but there is a still a lot that needs to be done. Before the end of my term, I want to rescue the municipality and ease the financial pressure on our residents,” he said.

LK Security Solutions is one of many companies that are currently being critically evaluated in terms of service requirements as agreed upon in the tender documents, versus the actual service being provided.

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Cllr Sibiya indicated that a due diligence report had been completed for LK Security. While he would not go into the details of the report, he did indicate that there was a serious gap between what was promised, and the service that is currently being rendered.

From the very beginning, LK Security Solutions had been awarded the contract under a veil of controversy. At the time, a high court order stipulated that any contract the municipality entered into, had to first be endorsed with a council resolution before it could be awarded, yet Ms Mnikathi violated the court order awarding the R31million contract to LK Security Solutions without the knowledge of the council. She later defended herself, saying the councillors would not get involved in administrative matters and asked that she only report to them once a Service Level Agreement (SLA) had been drawn up.

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Cllr Sibiya said the council had asked Ms Mnikathi on numerous occasions if she had awarded the tender and she continued to say she hadn’t, until a signed document surfaced in which she had informed LK Security Solutions that they had been awarded the tender.

After Ms Mnikathi’s employment contract at AbaQulusi had ended, neither the acting municipal manager who occupied office after her, Dalisu Zulu, not the municipal manager that was permanently appointed afterward, Bonga Ntanzi, would draw up an SLA for LK Security Solutions.

“We could not draw up an SLA while there were issues regarding the manner in which the tender was awarded. If a municipal manager had to sign an SLA with the company, that municipal manager would be endorsing an irregular expense that would be regarded as fruitless and wasteful during an audit. That would make the municipal manager responsible for that wasteful expenditure,” explained Mr Ntanzi.

A representative of LK Security Solutions, who spoke under anonymity, said that the company had followed all the correct procedures from its side, and had tried on numerous occasions to engage with the municipality but to no avail.

“The previous company that rendered security services was poorly managed, the staff didn’t have uniforms and they were paid in an envelope. We had hoped to show the municipality how security services were rendered on a professional level. We did everything necessary to ensure a high level of professionalism was maintained from our side but, from the beginning, we had issues with regards to not being paid. We have never received payment by the due date. First, they would tell us that there is only a signature missing, then they told us the municipality is bankrupt. We always got excuses. The company had to resort to borrowing money to ensure the staff was paid on time. We can’t carry on like this. We have never had a contract with a customer and been treated so unprofessionally. We believe that there is a political agenda to have us removed and we can feel the heat,” he explained.

At the time of print LK Security Solutions had not paid its guards for three months on account of the company not being paid by the municipality.

“The guards are still going to work every day and performing their duties. They cannot afford to pay rent or buy food for their families but there is nothing we can do until we are paid by the municipality,” continued the representative from LK Security.

Cllr Sibiya, Mr Ntanzi and Chief Financial Officer (CFO), Mr HA Mahomed, explained that the reason LK Security Solutions had not been paid, is because the company had attempted to pass on a 10% escalation cost to the municipality.

“The tender documents they submitted clearly indicated that there would be no escalation costs during their contract, but now their invoices are reflecting a 10% increase. This goes against what was agreed upon in the tender documents and they need to change the invoice according to what was agreed upon if we are to pay them,” said Mr Ntanzi.

“The increase in cost is not an escalation, it is a regulation by the Department of Labour for all service providers,” argued LK Security Solutions.

“The guards for LK Security Solutions did abandon their posts when they weren’t getting paid by their employer and the speaker, the deputy mayor and I sent our personal security guards down to man the front office to ensure that the municipality was safe. When the guards realised the municipality was still functioning normally, they returned to their posts.

“There have also been numerous incidents of theft that have taken place since LK Security was appointed. Councillors have complained that they have been to municipal sites and could not find a guard there, equipment was stolen in Coronation, four new tyres were stolen off a municipal vehicle and a cable was stolen at the dam in Vaalbank,” said Cllr Sibiya.

In the meantime, AbaQulusi municipality is close to awarding another security tender to “fill the gaps in security at the all the critical municipal sites that were excluded when the contract to LK Security was awarded.

Asked to justify how the municipality can afford to spend more money on security when it is attempting to cut down on costs, Cllr Sibiya responded with an example, “Last week, parts of the community did not have water. The steel valves at the reservoir had been stolen and the reservoir had emptied out. If we had had someone protecting this site, this would never have happened. Not only were the residents inconvenienced but we had to pay to have the parts replaced. When a transformer or cables or equipment are stolen, it can cost us millions to replace or repair. We cannot afford to leave these sites unguarded”.

On October 27, LK Security Solutions received a letter from AbaQulusi municipality indicating its intention to terminate the contract.

“It is a letter of provocation. Civil communication has completely broken down and since they are coming with this tactic, we are getting our lawyers involved,” concluded the representative from LK Security.

Estella Naicker

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