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DA: Statement by Marc Steele, Democratic Alliance spokesperson on public accounts, questioning why there is no debate on the N2 Gateway Report (26/11/2010)

26th November 2010


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The Standing Committee for Public Accounts (SCOPA) adopted its report on the Auditor-General’s special audit of the N2 Gateway housing project in February 2010. Ever since then the report has sat on the National Assembly order paper. New and apparently more important reports kept filling up the parliamentary order paper and SCOPA’s N2 Gateway report fell further and further down the list. The National Assembly has now concluded its agenda for the year and the report will in all probability fall permanently off the order paper. This means it may never be debated in Parliament, and perhaps more importantly that the recommendations contained in the report will not be adopted as resolutions of the House. The Democratic Alliance believes that the failure to debate and adopt these resolutions means that the whole scandal surrounding the initial planning, tender award, construction and management of the project will be covered up in much the same way that the arms deal has been covered up by powerful political forces within the ANC.

The deeply politicised nature of the project was never in dispute. Its origins lay in the Presidential State of the Nation address of May 2004 and the ANC’s determination to use its control of all three spheres of government in Cape Town and the Western Cape to implement a dramatically different style of housing delivery project which could be used as an election showpiece in the upcoming 2006 local government election. Key legislation was not in place at the time and the project commenced without proper timeframes for planning and implementation. The Auditor-General found: ‘The business plan for the construction of the N2 Gateway project had not been finalised and approved before the actual construction commenced, with the result that … the executive committee of political office bearers (the so-called M3) and the three spheres of government failed to meet their responsibilities in terms of the Memorandum of Understanding’. In 2006 control of the City of Cape Town passed to a DA-led coalition and subsequently in 2009 the DA took over government of the province of the Western Cape. The consequences and costs of the bad planning, tender irregularities, shoddy construction and poor management of the project have thus had to be dealt with by new administrations and not those originally responsible. Political accountability has never been apportioned and the ANC has protected those involved from the proper public scrutiny.

SCOPA’s recommendations covered the three main areas of concern uncovered by the Auditor General. The first related to defects in the initial planning phase, and specifically warns that professional advice from the appropriate housing officials must be followed and that the ‘risks associated with the project’s proposed timeframes must not be compromised’. The City Manager of the City of Cape Town confirmed that officials of the City advised the M3 (then Minister of Housing Lindiwe Sisulu, MEC for Housing Marius Fransman and City Mayor Nomaindia Mfeketo) that the deadline of six months to construct 22 000 units could not be met and that, in his words, ‘the M3’s view was that as the money was available, the six months deadline was not negotiable’. This ‘non-negotiable deadline’ suggested that massive political pressures were exerted on officials to make the project happen and the DA members of SCOPA were determined to bring the members of the then M3 before the Committee to establish their role in the process. Crucially this request in the form of a formal resolution put to SCOPA by the DA was defeated by the ANC majority on the committee, who were joined in the vote by every other opposition party represented on SCOPA. 

The tender process for the award of the project managers contained numerous irregularities, including the selection of the company originally ranked as 6th by the evaluation committee, a company moreover which lacked the necessary specialist expertise to perform the various project management functions. Funds lost or wastefully spent may never now be recovered. 

The physical defects during the early construction phase, in particular at Joe Slovo Park, were clearly visible when SCOPA went on a site inspection visit. These included cracks in walls and floors, loose or non-existent fittings, uncovered drain pipes and blocked drains. It was clear that compliance certificates and building inspection procedures had been rushed through as even the certificate for completion of the contract was ‘erroneously issued’, according to the Auditor-General.
At the end of the day the people living in informal settlements for whom the project was intended have never been able to occupy the units, which they simply can’t afford. Only 871 units of the revised number of 16 735 were completed by May 2007, two years after the project commenced. Millions have been wasted in a project which was mainly about political window dressing by the ANC and little about actual delivery to those desperate for affordable housing in Cape Town. Showpiece projects which consume massive public resources are used for political and not service delivery purposes, and those who should be held accountable have been protected by their party structures.




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