Businessman attacks eThekwini tender system

a top black businessman in durban has hit out at the african national congress-led ethekwini city council, accusing it of granting lucrative contracts to a politically connected elite.

pinetown businessman themba parish "tp" ndlazi, who has run an electrical company for 20 years, cites two recent tender awards as proof of his claims. one of the claims has since been reversed.

he said the major share of a multimillion-rand cable supply contract for durban's electricity department had been awarded to class a cables, a company in which nelson mandela's granddaughter, nandi mandela, was a director.

this was in spite of the bid's being more expensive than his and that the cable was being imported from india and not locally produced.

he also claimed that, last month, businessman vivian reddy's edison power scored the electrical contract for the upgrade at the international convention centre, in spite of reddy's price being r4,1-million more than his.

deputy city manager, procurement and infrastructure, derek naidoo, has denied that there was any irregularity or manipulation in the award of these tenders.

but he confirmed that, following appeals, the council had done a rethink on the award to class a cables "and now it had zero".

in a stinging attack on the council's tendering process and those that oversaw it, ndlazi said: "why must i suffer because my parents are not well known... because i don't belong to any political organisation?

"i have worked hard . . . i have never benefited from the black government . . . and now i am being hindered by people who have political connections."

up until last year, tenders and appeals were first evaluated by council officials and then adjudicated by a committee of councillors. but with the passing of the municipal finance and management act last year, there is now no oversight.

tender awards and appeals are dealt with by municipal manager mike sutcliffe and top officials.

"while i am not saying it exists, the system does lend itself to collusion and manipulation. i believe there is a black elite which is being favoured," said democratic alliance councillor tex collins, who used to sit on the old tendering committee.

protas madlala, director of the thekwini business development corporation, which assists companies in durban, has called for transparency in the awarding of tenders.

"it is regrettable that, since the 1980s, one and the same electrical company has got the major electrical contracts: the hilton, gateway, suncoast, ushaka and the icc. what sort of empowerment is that?

there is no evidence that the award of these contracts has benefited a great number of africans," he said.

"i'm sure (the) council will oblige anyone who is complaining about the tender process, by placing a spotlight on the system, or we run the risk of bee in durban being called a sham."

ndlazi bid for the contract to supply city cables last year. he said it was worth r45-million a month, 70 percent of which was awarded to him.

however, his elation was short-lived when he discovered that the more profitable part of the contract - the supply of the most used cabling - had gone to nandi mandela's class a, which had been awarded 30 percent.

he said his price for the same cabling was r10,2-million less than class a's.

"they did this on purpose. on the face of it, they had given me this big contract. but because of their manipulation, it wasn't worth much."

nandi mandela is one of seven directors of class a. she is listed as a "consultant" on a company profile. she failed to respond to the mercury.

in december, ndlazi lodged an appeal. in june, when the matter still had not been resolved, he met derek naidoo who proposed that he join forces with nandi mandela and offered to set up a meeting between them.

naidoo admits the meeting took place, but denies making any such suggestion.

ndlazi said he did not know the outcome of the appeal.

but naidoo said that since the appeal, ndlazi's tp electrical would now share the 70 percent with two other companies.

class a's 30 percent had been rescinded and this portion would be re-advertised, because the original notice had not specified the value of items required.

"the percentage of the tender award is based on value. what ndlazi says is wrong... he got a significant contract. we estimate he would have got r19-million over two years," naidoo said.

he added that ndlazi did not tender for the 30 percent and that the contract was worth r70-million a year, not r45-million a month.

but ndlazi insisted the percentage split was not based on the value of the tender but on the number of items to be supplied. the re-advertisement of the tender was unlawful and was being done as a "cover up".

with regard to his appeal against edison power's getting the icc contract, ndlazi wrote to the city saying: "the impression is that you constantly support edison power with projects of this magnitude... it seems that price does not matter."

but naidoo said this tender was adjudicated by the principal contractor and not the council.

ndlazi said: "in theory he is right... but we all know that agreements are made behind the scenes."

edison's vivian reddy said tp electrical's expertise was not commercial work but in reticulation to township houses.

"we won the icc tender because we satisfied the bee criteria, the technical specifications and we were able to lodge a 12,5 percent performance guarantee."

he alleged that on a previous icc tender, tp electrical subcontracted a white-owned company that "did all the work". ndlazi denies this.