In compliance with the ill-fated contract with PEU Capital, the suppliers of the new smart meters, Tswana metro has paid more than R4,6 million every day during the course of February to PEU Capital, which impacted negatively on the metro’s task in the maintenance of the city’s infrastructure.
AfriSake, a division of AfriForum, last year lodged an urgent interdict to get the contract turned down. The application was turned down and according to Willie Spies, attorney for AfriForum, no date has yet been set for a court case to get the contract nullified. However, the possibility of a court case is used by the metro as an explanation for why the pace of installing meters is so slow.
According to the contract, PEU gets 19,5 cent out of each rand of electricity used. The contract to install 800 000 meters was approved in a council meeting in 2013. Since then, the metro council has paid R582 million to the service provider. Some 12 000 meters have already been installed and the more meters installed, the more capital PEU gets from electricity being supplied.
Aside from the R250 million the council has budgeted for, the council made a further R200 million available to PEU Capital.
Lex Middleberg, who spearheaded the launching of the initial court case, said: “Since January and February we have already spent R150 million, which means with the shortage in the first half of the year, we have already used the extra R200 million made available.”
“This shortage of funds has a ripple effect in that monies intended for electrical repairs and buying commodities, has been cut to generate cash needed to pay PEU. Technicians now have to make do with whatever they still have,” Middleberg said.
According to the opposition party’s calculations, the metro will have to, in the course of the eight-year contract, pay R27 billion to PEU.
Yesterday the City of Tshwane and Total Utilities Management Services (Pty) Ltd (TUMS) defended allegations of mismanaging of finances, saying that The City of Tshwane and TUMS, a company contracted by the city to roll-out the prepaid smart meters, are baffled at malicious media statements issued by the Democratic Alliance (DA) recently pertaining to the contract of prepaid smart meters in the city.
Selby Bokabe, spokesperson for the metro, said the legal proceedings instituted by AfriSake and AfriForum (supported by the DA councillors who issued the media statements) have adversely impacted the speed of the roll-out and resulted in some challenges in securing additional funding for the project.
“The City of Tshwane remains committed to the prepaid smart meter project, and will, in due course, announce specific details regarding the roll-out of the project. Notwithstanding the dismissal by the Gauteng North High Court of AfriSake and AfriForum’s initial application for an urgent interdict against the project last year, and due to the impact of their continued and prolonged legal challenge, the impasse has hamstrung the city’s ability to realise the full benefits of this magnificent prepaid smart meter implementation,” he said.
He said the DA, AfriSake and AfriForum’s court action is evidently hell-bent on crippling the City of Tshwane’s financial position with a view to imputing in the minds of the public that the city’s leadership is inept, incompetent, and downright reckless in financial management.
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