Moneyweb
Content partner
5 minute read
21 Sep 2018
7:32 am

We are prepared to die for radical economic transformation – ‘construction mafia’

Moneyweb

The grouping has stopped billions of rands' worth of projects to get participation.

Malusi Zondi, the president of Federation for Radical Economic Transformation. Screenshot from an interview with Moneyweb

One night about three years ago Malusi Zondi and his comrades were preparing for war in the bushes around KwaMashu township in KwaZulu-Natal.

He grew up in this poor community “where our role models carried guns and survived through criminal activities”.

Zondi became involved in the politics of the ANC Youth League from the age of 12 and left the country in 2013 after being warned that his life was in danger. In neighbouring Zimbabwe, he got involved in the black market for diamonds and gold and tasted real money for the first time. He also saw how the people of Zimbabwe worked together, in sharp contrast to the political infighting he experienced at home.

In 2015 he returned to his hometown, determined to carve out a different future for the disadvantaged youth. As a founder member of the Youth in Action movement in KwaMashu, Zondi fought for his people. They lobbied the sector education training authorities (Setas) and got training and placements for young people. He claims that more than 700 young people were placed in job opportunities.

At its conference in 2015, the organisation resolved to move towards radical economic transformation. Long before this term became fashionable, Zondi says, they studied the meaning of ‘radical’ and concluded that it should be rational, not aggressive. “Nothing should be about us without us,” he says.

A few months later in 2016, they shut down construction of the Bridge City Mall, demanding participation in the project. They did the same on the site of the area’s new court building and R1.9 billion hospital project. The result was that many local young people got training and 300 were employed on these projects, Zondi says.

On that fateful night, however, the infamous Delangokubona Business Forum was headed to KwaMashu (from nearby Umlazi) to take those hospital jobs from Zondi and his mates for their own members.

Delangokubona consisted of former criminals and ex-MK military veterans who were fighting for economic participation, Zondi says.

The confrontation was set to take place outside the township in the bush, to prevent innocent bystanders from getting hit in the crossfire. Both groups were armed. AK-47s, 9mms. And Zondi’s group was supported by the local taxi industry.

When the two groups eventually met, something surprising happened. They recognised that they had many close family and friendship ties, and a common goal.

The Federation for Radical Economic Transformation was formed.

Today the organisation unites at least 35 business forums and has structures in various provinces. They have stopped billions of rands worth of projects to get participation and have been dubbed the ‘construction mafia’.

Last year they shut down Eskom’s Duvha power station and, as a result, says Zondi, “the contracts started coming.”

They have succeeded in having a policy adopted by the eThekwini metro (Durban) that ensures 30% contract participation goals over and above the legislated BEE and preferential procurement requirements.

This demand for 30% participation has since become the hallmark of business forums at virtually every construction project countrywide.

The unintended consequence was that business forums started sprouting up everywhere, outside of the federation, enforcing their demand for 30% contract participation by all means. “We created mafias,” says Zondi.

The federation now “manages” these “opportunistic” business forums with the assistance of the taxi bosses. These guys go peacefully, Zondi says, but everybody knows they have guns.

Zondi was elected president of the federation earlier this year and estimates that its members collectively earn revenue of about R50 million a month from project participation that it has secured.

The federation is professionalising. It has partnered with black architects, quantity surveyors, chartered accountants and many more, Zondi says.

They have engaged construction industry bodies and big developers and construction companies.

They are adamant that National Treasury procurement regulations are inadequate for addressing the radical economic transformation needed to empower their communities. There is no policy that benefits their members beyond the age of 35 and BEE has benefited only a few, Zondi says.

Another thorn in their flesh is the central database of suppliers, which they say is controlled “somewhere” to benefit some suppliers. It excludes small and informal businesses, he says.

The federation recently broke up a meeting of the KwaZulu-Natal department of health, believing that tender specifications were going to be changed to suit certain suppliers and exclude its members.

Zondi criticises National Treasury for its intervention in that department, which he says led to the appointment of a consultant who is being paid thousands of rands per hour. The consultant has been there for eight months and is the only party benefiting, he says. As a result, the department is not awarding tenders

In fact, state tenders are currently so few and far between, he says, that federation members rely on work from the private sector.

The tense situation at that health department meeting was defused when the MEC, Dr Sibongiseni Dhlomo, intervened. Nothing much has happened since, and the clock is ticking, says Zondi. They want the consultants chased away, saying the department’s own supply chain management staff must do the procurement.

Zondi is clearly hurt by President Cyril Ramaphosa’s subsequent call for the arrest of business forum members. This is not radical economic transformation, Ramaphosa said; he called the federation’s actions radical economic robbery.

The ANC doesn’t have a mechanism to achieve radical economic transformation, Zondi says. It is just talk. Self-enrichment, he says.

If they don’t move on including disadvantaged people in the economy it means whites will be killed, he says.

“We have told them about Marikana … ” he says. (This is an apparent reference to the book We are Going to Kill Each Other Today: The Marikana Story by Athandiwe Saba, Lucas Ledwaba, Sebabatso Mosamo, and Thanduxolo Jika, NB Publishers, 2013.)

Zondi says he has been told to shut up, that “there is money”. But he is not for sale, he says.

He has been told that he will be killed, but he doesn’t care.

He is on a mission. He is prepared to die to achieve radical economic transformation.

Brought to you by Moneyweb

For more news your way, download The Citizen’s app for iOS and Android.