Tuesday, April 5, 2011

R 26.5 m Paid - Termination of Contract

Dispute kills R208m road contract....

Apr 5, 2011 

The R208 million Koster to Lichtenburg road construction contract has been terminated, the North West public works, roads and transport department said on Tuesday. 

                                                               Koster to Lichtenburg

While the department claimed the termination was over a lack of progress on the project, contractor Kaulani Civils claimed it had not been paid.
"We are taking them to court because they did not pay us since January. Our company did a good work, but the department failed to pay," said the company's managing director Anthony Schooling. 

Denying the claim, departmental spokesman Matshube Mfoloe said R110 million -- or about half the contract -- had been paid so far and that payments had been processed within a reasonable period.
He said a payment of R3.9m was made on February 1 and another of R10.6m was made on February 10.
"On December 17 last year we paid them R7.5m and on November 11 we paid them R4.5m. 

"Our action against Kaulani Civils must serve as a strong warning to other companies that continue to take government for a ride by cutting corners and delivering sub-standard quality to the people of the province," said Mfoloe. 

He said the department's patience with Kaulani Civils ran out on March 14, when it was issued with a notice of intention to terminate the contract. 

The company was given 14 days to improve performance on the site or give reasons why the contract should not be terminated, he said. A contract termination letter was issued on March 29. 

"The failure of the company to perform the task is disturbing all daily and frequent users of that road, which we consider extremely important, for the general motoring public, the farming community in the area and other entities doing business in and out of the North West," said Mfoloe. 

The road should have been completed in November, he said.
Mfoloe said the road was 80km long, but that Kaulani Civils was awarded the contract on 50km. It vacated the site on Saturday. 

"We have moved swiftly in ensuring that the critical function of controlling traffic be taken over by different company in the interim in order to avert the likelihood of vehicle collisions, especially at several high accident zone," he said. 

The department would now start the process of appointing a new and "competent" contractor to complete the project. 

No comments:

Post a Comment