The Mpumalanga Department of Human Settlements has strongly condemned the failure of several main contractors to pay subcontractors, which severely hampers the implementation of projects in Mbombela.
During a recent interview, the MEC for co-operative governance, human settlements and traditional affairs, Speed Mashilo, expressed his disappointment at this trend, stating that it is unacceptable for beneficiaries to suffer due to conflicts between contractors and subcontractors. He emphasised that main contractors must formalise their agreements with subcontractors to make them legally binding.
The department deals directly with the main contractor. All government work must be paid for within 30 days, and we expect contractors to adhere to the same payment timelines for their subcontractors
Mashilo reiterated that it is the responsibility of the main contractor to pay subcontractors for the work completed as per the terms of their agreement. “The department deals directly with the main contractor. All government work must be paid for within 30 days, and we expect contractors to adhere to the same payment timelines for their subcontractors. We are aware that a significant portion of the work is carried out by subcontractors,” Mashilo stated.
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He also highlighted that contractors are required to subcontract a minimum of 30% of the total contract value to small, medium, and micro enterprises and local co-operatives.
The media has recently reported about such payment challenges of subcontractors of the Rondebosch multiyear project in Middelburg. The project has been stalled due to the non-payment of subcontractors. It was expected to deliver 5 591 BNG housing units, 907 First Home Finance units, 8 796 residential housing units, 1 428 medium residential stands, and 1 100 high-density residential stands, with an additional 43 stands reserved for socio-economic purposes.
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To date, phase 1 of the project, comprising 2 226 stands, has been completed, but the construction of top structures is in various stages of development. As per the project delivery plan, the department has fully paid the main contractor all monies due to them.
When such challenges arise, the department must step in, as these issues negatively impact our delivery. We urge contractors to honour their agreements
In mitigating the stand-off, Mashilo said he has held several meetings with all stakeholders involved in the project, including the main contractor, to find an amicable solution that would allow the project to continue. Following these consultations, it was agreed that the scope of work would be reduced from servicing 2 000 sites to 500 sites.
“When such challenges arise, the department must step in, as these issues negatively impact our delivery. We urge contractors to honour their agreements and ensure that subcontractors are paid for the work done,” stressed Mashilo. He concluded by stating that this situation should serve as a lesson for all parties involved, and that the department does not expect similar incidents to occur in other projects.
