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Medupi hush money claims

May 27 2012 15:58
Antoinette Slabbert

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Medupi contractors blast Eskom

Pretoria - Hush money: that's what the Medupi Power Station Joint Venture (MPSJV) is offering four emerging subcontractors in settlement of their claims for compensation for masonry work at this new Eskom power station in Limpopo. 

This is according to a furious Martin Nel of Baarata who, together with subcontractors Lezmin, TT61 and Zin-zi, has been financially ruined after subcontracts that should have put their businesses on a new growth path went awry.

Sake24 has previously reported that the four contractors reckoned that they had been bullied into unworkable contracts.

According to Nel, the companies’ labourers alone had cost Baarata more than R19m, while its total income from the contract was only around R9m.

MPSJV, a joint enterprise between Concor, Grinaker-LTA and Murray & Roberts (M&R), with M&R as leader, previously responded by saying that it had done what it could to help the contractors.

Meanwhile, an independent report that Eskom requested on the issue remains secret despite several requests from these subcontractors to see it.

According to Shakes Ndou, the owner of TT61, he and the other three subcontractors were suddenly told on Thursday to attend a settlement meeting on Friday morning. He borrowed money to travel from Pretoria to Lephalale for the meeting.

When he arrived, MPSJV made each one a separate settlement offer which, he says, was pathetic.

According to the written offer, which Sake24 has seen, the settlements are subject to the subcontractors halting legal action and not discussing the content with anyone other than their legal and financial representatives.

They are expressly forbidden to discuss the offers with other MPSJV subcontractors and therefore with each other – which would be regarded by the JV as a rejection of the offer.

Sake24 understands that during the settlement meeting they were expressly warned not to speak with the media.

Ndou said this would also mean that he would be prevented from further discussing the matter with President Jacob Zuma’s presidential hotline, which he had approached for assistance.

On Friday the MPSJV said the confidentiality clause was normal practice. Each of the four has rejected the offer.

Shamima Mulla, the owner of Zin-zi, said she is extremely disappointed. She reckons that MPSJV has tried to take advantage of the subcontractors’ desperate plight.

She cannot accept the meagre R54 000 offered while, for instance, she still owes construction funders Nurcha (Tusk) about R700 000, she said.

The subcontractors were also apparently told that the settlement amounts were not based on the independent report, and they were given no insight into how the amounts had been calculated.

On Friday the MPSJV declined to respond to enquiries because, it said, the offers had not been accepted yet. It claimed it had not seen the Eskom report either.

Nel says if the report showed that these subcontractors were at fault, Eskom would surely have said so.

The fact that the content is being withheld strengthens their suspicions that the report supports their claims.

Ndou says he and his colleagues will not be silenced like children with a “sucker”. They won’t rest before they get what is legally owing to them.

Every day one hears that government is helping small and emerging contractors through expenditure on infrastructure, he says. Medupi is currently the country's biggest project, but Eskom is sitting back and watching their ruin.

In contrast to the statement by the MPSJV, Eskom said it had discussed the contents of the report with the JV.

According to Eskom spokesperson Hilary Joffe, the utility has no formal relationship with the subcontractors and is under no obligation to share the findings with them.

Joffe initially told Sake24 that Eskom had been informed by the MPSJV that three of the subcontractors were prepared to settle, and that the fourth would accept independent arbitration by an outside party.

When Sake24 pointed out that this did not agree with what the contractors or the MPSJV had told our reporter, she changed the statement, saying that the MPSJV was prepared to settle with the subcontractors.

 - Sake24

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eskom  |  medupi power station



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