A decade of ghosts in 1 govt building

The provincial government archives building, situated in Potgieter Street, has been standing empty – almost ten years since the land for the project was first acquired.

The land was acquired in the 2003/4 financial year and the site handed over to Thabang Property Developers on September 15, 2006.

On January 18, 2007 a letter was issued by the Polokwane Municipality that building had commenced, without the plans being approved. Contractors had to stop construction.

An investigation by the Auditor-General’s (AG) office revealed that even before construction began, matters were not as they should be. This included irregularities regarding the initial bid and site inspection certificate. Irregularities continued with a payment certificate being issued even before the building plans had been approved. This resulted in the contractors having to stop building.

No evidence to verify the budgeted amount could be found later. The department of sport, arts and culture did not have the budget to complete the building in contravention of Section 39 (1) of the Public Finance Management Act. Variation orders were issued and treasury was asked time and again to assist with outstanding payments. The construction was to have been finalised by September 2008. On May 20, 2009 the public works department indicated that an amount of R21,3 million was needed for the completion of the building. The estimated final contract value was set at R46,2 million on July 29, 2009. This was 49% above the estimated original contract.

During August 2010 a final settlement offer of R6,9 million was made to finalise the building. The building still would not be fully functional and would require more funding to be functional. The money was promised by treasury in November.

Matters between the department of sport, arts and culture and the contractor dragged on throughout 2011 until June 2012, when it was found that the building was gradually deteriorating, increasing the likelihood of additional expenditure before occupation.

The AG’s finding was that the department incurred irregular expenditure of R39 million due to the contract awarded in contravention of the procurement regulations.

It was also found that the department did not budget adequately for the provincial archives building and had unpaid invoices amounting to nearly R7 million, on which interest of over R800 000 accrued while the department was waiting for treasury to provide additional funding for the outstanding bill.

The Standing Committee on Public Accounts wants this money to be recouped. According to Edwin Tomes, managing director of Thabang Property Developers, he was still owed a part of the retention money. “But a very small percentage,” he said.

The initial reason given in 2010 why the building was left unused, was that there were infrastructural challenges that had to be attended to.

An enquiry not long afterwards yielded the answer that telephone lines had to be installed. The building, which belongs to the department of sport, arts and culture, and was commissioned by the department of public works is according to the former department’s spokesperson, Khathu Sadiki now in use.

This, even though there is very little movement on the premises and the building appears to be empty. The grass is also overgrown.

Sadiki said the arts department was not responsible for infrastructural challenges, and maintained there are people working in the building, and that documents had been brought from the districts. He said the building was not being fully used due to “networking challenges” and structural defects in some parts of the building which could cause damage to documents as soon as it rains.