Construction of ring road at a standstill
Discussions between stakeholders are ongoing, but construction of the N1 Polokwane ringroad will not continue full-scale at the end of February, as was originally planned.
POLOKWANE – The process is currently marred by a number of complexities.
In November, Siphiwe Mxhosa, Head of Stakeholder Relations at the South African National Roads Agency Ltd (Sanral), announced that the project would resume at the end of the month. Sanral Regional Manager, Progress Hlahla told Review a statement would be issued in this regard following a meeting that was to have been held yesterday (Wednesday), on the complexities of how to proceed with the funding available.
“The business rescue plan is not proceeding as well as envisaged and it affects the progress of projects. In Limpopo, we also have the Musina ringroad project to finalise.”
Construction on the ringroad project ended last March with the construction company, Basil Read, entering into voluntary business rescue in June.
Discussions between stakeholders are ongoing, but construction of the N1 Polokwane ringroad will not continue full-scale at the end of February, as was originally planned.
Its business rescue plan was accepted in September.
Construction on some parts of the project resumed in October, but the lack of finances hampered full scale work to continue, Mxhosa said at the time.
The appointed business rescue practitioners believed Basil Read’s construction division could be successfully turned around, with an improvement in cash flow anticipated by the end of a two-year period in which the company will complete 17 construction contracts.
It reportedly planned to invest R265 million in funding it has secured to complete those contracts. The N1 Polokwane ringroad project was to cost more than R650 million, and Basil Read had paid out more than R300 million to contractors already.
In November, members of the Economic Freedom Fighters (EFF) blocked the N1 southbound, disrupting traffic, pending the arrival of Sanral delegates.
Jossey Buthane, Provincial Secretary of the EFF demanded to see a representative from Sanral, to get answers as to when the roadworks would resume on the project.
https://www.citizen.co.za/review-online/284022/take-note-protest-action-city-entrance-n1-south/
In a closed follow-up meeting between Sanral and the EFF, held at Roads Agency Limpopo’s offices, issues including the involvement of local SMMEs were discussed.
A representative of Basil Read reportedly gave the assurance to the EFF that the involvement of local SMMEs will receive attention when construction resumes.
The structure of the project governing structure of the ringroad project was also discussed, and it was resolved that stakeholders other than the municipality and Sanral would also serve within the structure of the project liaison. These will include RAL, the departments involved such as Public Works and Infrastructure and Social Development.
RAL CEO, Maselaganye Matji said the agency engaged in talks with Sanral to discuss burning issues such as the N1 from Kranskop as well as the safety of the Mogwadi (Dendron) road.
The business rescue plan for Basil Read, tabled on 27 September and presented by business rescue practitioners John Lightfoot and Siviwe Dongwana, was approved and business rescue practitioners said they believed that Basil Read’s construction division could successfully be turned around with an improvement in cash flow anticipated by the end of a two-year period in which the company will complete 17 construction contracts. It was reportedly to invest R265 million in funding it has secured to complete those contracts.
Basil Read reported a net loss in March, after tax, of R1 billion for the year ending December 2017 as a result of a number of legacy contracts that resulted in losses, the write-off of goodwill in the roads division and the reversal of deferred tax assets in non-profitable entities.
