Department’s lawsuits stack up to R164m

The Gauteng Department of Infrastructure Development faces multiple lawsuits totalling more than R160 million for defaulting on rent and not honouring contracts with service providers. On Tuesday, the department told the Gauteng provincial legislature’s standing committee on public accounts (Scopa) that it was the defendant in 19 high court civil cases, in which the applicants wanted a total of R164m from the department. One of the companies suing the provincial government was Ilima Joint Venture, which was the consortium awarded a tender to build Jabulani Hospital in Soweto in 2006. The initial amount for the contract was R334m, but this escalated to R700m after the contract was terminated. It was discovered that the consortium did not have a valid tax certificate.

Ilima has now filed two separate lawsuits. Scopa heard that Ilima had filed a lawsuit of R41m, asking the Johannesburg High Court to interdict the department and provincial government from calling for guarantees as the department had allegedly failed to release the performance guarantee. Ilima also asked the court to order the department to pay it R21m after it terminated the contract, alleging the consortium had produced a fraudulent tax clearance prior to being awarded the tender. Scopa chairman Sipho Makama was astonished it was not the department suing Ilima for shoddy work. He also indicated to the committee that the Gauteng provincial treasury had already taken a decision not to make a single payment to Ilima after the government had to pay more than R350m to complete the construction of the hospital - seven years later.

The Jabulani Hospital matter has widened the rift between Premier Nomvula Mokonyane and DA leader in the legislature Jack Bloom. The DA leader has used the delay in the construction to accuse Mokonyane of not being accountable for the use of public funds. Mokonyane has been insistent that she would not open any institution until she was satisfied that the structure was ready for operation. During Scopa proceedings on Tuesday, members also expressed concern that the department was about to foot a R3m lawsuit against the former infrastructure MEC, Faith Mazibuko, for defamation of character. Mazibuko has been MEC for Community Safety since November 2010. The lawsuit against her and Mokonyane was filed in August 2011.

It was not clear in the papers provided to Scopa when Mazibuko made the allegedly defamatory utterances to a person named only as Raditjetje. The department is also facing a R43m suit from Tau Pride Moteko for services rendered. Moteko has applied for an interdict against the department to prohibit it from putting out on tender services that Moteko was rendering. No claim amount was mentioned in the interdict application. Scopa was told that the department was defending a claim of more than R500 000 for its alleged non-payment of rent between 2007 and November 2009. The Community Safety Department, the occupant of Ekangala regional office 4 356, has verified that the building was previously occupied by the Mpumalanga Public Works, Roads and Transport Department.

Scopa gave the Department of Infrastructure five working days to provide it with the details of the lawsuits against it. The infrastructure department was also expected to give reasons to the committee for why it has written off assets worth R86.4m.