Setheo Engineering heads not taking fraud allegations lightly
The latest news on Eldorado Park substation.
In response to the controversial developments at the City Power substation, Setheo Engineering offered their take on the matter. Brighton Chisamba, the project manager at Setheo Engineering said, “We have been reluctant in the past to respond to the mayor of the City of Johannesburg, Herman Mashaba, through social media.
“However, the unrelenting attack and deliberate efforts by the mayor to drag our name through the mud with the intention of completely destroying us can no longer be tolerated.
“An allegation has come to our attention that the mayor is driven by personal vendetta, having been in the same line of business in the past, and it is alleged that he still has links to our competitors.
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“While parts of the contractual issues are already before the courts, we felt compelled to give the residents of Johannesburg our side of the story so as to balance the equation.
“For months now, the Mayor has been playing a game of attrition and also throwing as much mud as he possibly can hoping that some of it will stick. We felt it important to afford the discerning public of Johannesburg an opportunity to sieve facts from fiction.”
Chisamba said, “First and foremost, Setheo Engineering has a contract with City Power and not with the City of Johannesburg.
“The allegations being made by the mayor are that a forward payment of almost R66 million was made to Setheo Engineering, without evidence of any physical work done at the Eldorado Substation.
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“This cannot be further from the truth and was devised with the sole purpose of misleading the public and in the process scoring some cheap political points. The only point of agreement we have with the mayor is that Setheo Engineering was indeed paid R66 million.
“However, these were not forward payments but rather milestone payments for works done and equipment purchased as guided by the NEC contract.
“This is not a special arrangement for Setheo, but all the contractors within the City Power ecosystem that entered into NEC contracts. More importantly, to date, the value of works carried out by Setheo Engineering on Eldorado substation is valued at over R116 million.
“This has been independently verified by qualified engineers and not some thumb sucked figure arrived at by some so-called investigator with very little to no knowledge of engineering projects.
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“Our client, City Power under the new board that was appointed by Mashaba, did its own verification of the works done and came to the conclusion that Setheo has indeed done work to the tune of R116 million and as such is owed R50 million.
“As we speak right now, there 4x45MVA transformers on valued at over R30 million, but the mayor will choose to ignore all that. In fact, for all payment claims made to date are as prescribed in the BOQ and guided by the NEC contract.
“Our view on this matter is that the mayor has overreached and rendered even the board appointed by the new administration and everyone in the value chain useless and illegitimate. Why is it that not one person from City Power, be it board member or the executive has been interviewed?”
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With regards to legal action, Chisamba added, “As stated earlier, the relationship between us and our client is guided by the NEC contract and there are prescripts in the contract on how contractual disputed should be handled and as such we exercise our rights as guided by the contract.”
Dealing with the timeline of the substations, Chisamba said, “Eldos was due for commissioning in March next year but we had submitted a revised plan to hand over to City Power and the end of October, five months ahead of time Hopefield was a three year project but we had submitted and City Power approved a plan for us deliver it in 12 months, meaning commissioning would have been August 2017.
“This is where it’s actually confusing when the Mayor claims we have failed to deliver the projects when in actual fact we were way ahead of schedule until our program where disrupted by lack of payments from City Power.
“See letter attached to City Power when they informed contractors that they have run out of the budget and they came tour office to explore if we could use our funds to complete the projects and get paid at a later stage.
“We informed them that we will consider that option once the R50 million has been paid. Then never got back to us but we latter begun learning through Mr Mayor’s social media accounts that we were under investigation.”
Chisamba concluded, “We have laid off everyone who was involved in the project except the security that is guarding the site. We have also complied with all labour concerning the staff laid off.”
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