eThekwini Municipality in clash with company over parking meters contract

The company currently managing parking meters in the Durban city centre is locked in a bitter dispute with the eThekwini Municipality over its operations, as the City says there has been no valid contract in place since the end of 2017.

Emtateni Logistics, however, says that it is a recognised service provider to the municipality and continues to submit reports to the City every month, which is part of the agreement it has.

In addition, Emtateni Logistics accused the City of failing to fulfil some of its obligations regarding the operations of the meters, which has led to the severe decline in parking revenue.

The company was founded by the late Prince Sifiso Zulu but entered business rescue and was liquidated in 2013. Cindy Naicker came in as the business rescue practitioner, appointed by the liquidators, to administer the trading and operations of the company.

The Mercury has seen recent letters exchanged between the City and the company regarding the contractual relationship. In one letter, city manager Musa Mbhele sets out the history of the contract and states that none has been in place since the end of 2017.

He further warned of legal consequences if the company continued to operate.

“eThekwini Municipality gave you permission to continue rendering Parking Control System services in terms of an agreement it had with Emtateni Logistics (Pty) Ltd until 30 June 2014. This was extended on various occasions, with the last extension ending on 31 December 2017.

“The agreement to render the Parking Control System services lapsed due to the effluxion of time. You, however, continued to collect money from the parking meters unlawfully, without a valid contract or authorisation, and have failed to pay the same over to the municipality.

“The above-mentioned conduct is not only unlawful but may amount to unlawful misappropriation of public funds. We reserve our right to report the same to the relevant authorities for further investigation and action."

In the company's response, penned by Naicker, she argued that a “valid and binding contractual agreement currently exists between Emtateni Logistics (Pty) Ltd., trading in liquidation and the eThekwini Municipality for the existing parking management”.

She added that in terms of the contract, there had been lawful collection of public funds and in addition, there was money owed to the company in terms of the contract.

“We have consistently met our contractual obligations with unwavering commitment, ensuring the effective delivery of the parking management system through our skilled workforce. Our commitment to providing an interim parking solution remains operational and is acknowledged daily,” Naicker said.

Naicker told The Mercury that the dispute was costing the City millions of rand in potential revenue.

She said the company has for years been kept on a month-to-month contract by the municipality, which has made it impossible to invest in the necessary infrastructure.

She said the month-to-month contract came into place after the company entered business rescue, and it was to run until a new tender for operating the meters was finalised. She added that several attempts to finalise the meter tender have failed, leaving the company to continue working under this uncertain arrangement.

“We have continued to produce reports every month (for) the municipality. Over the years, I estimate that the municipality has lost close to R300 million in potential revenue because of this (situation) and has suffered a significant loss in reputation,” Naicker said.

Naicker said the City was supposed to provide around 50 officers to monitor the parking meters when they were operational; however, they were withdrawn and this led to illegal car guards entering the scene and tampering with the tickets.

She added that the meters have also been vandalised, leading to a decline in payments due to their non-functionality. In response to questions, municipal spokesperson Gugu Sisilana stated that there is no valid contract between the City and the company.

Asked about what steps are being taken if there is no contract in place, Sisilana said the legal process is ongoing.

On the claim about monies owed to the City by the company, she said this was also subject to a legal process.

On the allegation raised by the company that the City had failed to meet its obligations as part of the contract, causing financial losses, she said, “We cannot comment on the unsubstantiated views held by the company, save to say that the company was appointed to administer the parking system and that contract has since expired."