Saturday, July 22, 2006

Embattled N2 Gateway project is ‘poisoned chalice’

THE N2 Gateway project has been described by Cape Town mayor Helen Zille as a “poisoned chalice” inherited by the new Democratic Alliance (DA)-led multiparty municipal government from its African National Congress (ANC) predecessor.

The controversy over the project, a national pilot project partly aimed at improving the facade of shacks lining one of the city’s main gateways, from the Cape Town International Airport, is still far from over.

A legal battle now appears to be looming between the province and the city over aspects of the contracts. The forum for ministers and MECs (Minmec) declared the dispute, but has so far not released details

In addition, the city council has instituted a forensic audit into the entire project, specifically into the awarding of a R12m contract to Cyberia Technologies to manage the development. Cyberia Technology’s contract was ended in January, but an additional amount of R4m was paid to it without the matter being referred to the council.

Minmec’s decision to call in the auditor-general to review the finances of the project was welcomed by Zille, who says that the move does not mean that the council’s own forensic audit will not proceed…

After two postponements by Housing Minister Lindiwe Sisulu, the last meeting of the M3 was “mischievously” rescheduled for May 31, the day Zille and her multiparty government had to defend a motion to change the city’s executive mayoral structure to a mayoral committee system. It would have been suicide for her not to attend the crucial vote, given the slim majority of two that the multiparty government then had in the council.

The N2 Gateway, which has the aim of providing 22000 housing units, has been dogged by financial problems since it was announced by the cabinet in 2004. In June last year, while it was still under the control of the ANC, the city’s audit committee said that the total N2 Gateway project would cost R2,3bn and that 22000 residential units would be completed by December this year.

But the reality, according to the multiparty government, is that contractors are owed millions of rands and there could be a cost overrun of R28m on the 705 units completed so far at the Joe Slovo phase in Langa...

The deadline for applications in this process was yesterday.

The announcement of who will get these houses will be made “without pressure from anyone”, says Richard Dyantyi, Western Cape housing MEC.

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