We'll pay you next year

[Balstrome]

Joburg wants contractors to work without pay - IT company goes bust
Sep 17, 2009 10:43 PM | By AMUKELANI CHAUKE

Johannesburg is considering asking contractors working on 2010 Fifa World Cup soccer stadiums and the on the bus rapid transit system to continue working without pay until next year.

This comes as an information technology company with 160 staff - which is owed up to R100-million by the city - has been forced to close "because of non-payment".

City officials told The Times that, at a mayoral committee meeting yesterday, the Johannesburg Development Agency proposed asking contractors to begin submitting their invoices only next year.

This follows reports that city officials have been asked to cut spending in a bid to save R1-billion as the recession takes it toll.

Media reports have revealed that the city is struggling to pay its creditors and contractors.

Now the national Treasury has undertaken to give the council a R1-billion "grant" for "infrastructure projects".

Treasury spokes-man Lindani Mbunyuza rubbished claims that the grant was a bailout for the city.

Speaking at the mayoral committee meeting yesterday, DA councillor Victor Penning said the development agency's proposal was on the committee's agenda.

But development agency chief executive Lael Bethlehem has denied that the proposal was made.

Companies contracted to the metro have complained that they are not being paid.

One of them, Masana Technologies, an information technology supplier, has filed for liquidation. It blames its demise on the city's failure to settle a R100-million debt.

Masana was formed about a decade ago after the city decided to outsource its IT functions.

Reuben Miller, of RMG Trust, the liquidators of Masana, said the metro owed the company between R60-million and R100-million.

"They give you all the reasons when you make follow-up inquiries on outstanding payments, but they just don't pay at the end of the day," he said.

City of Johannesburg spokesman Nthatisi Modingoane said: "The city denies that the liquidation of Masana is due to non-payment on the part of the city.

Modingoane said the Johannesburg metro was not willing to "debate this matter in the public arena".

Miller said he would test Modingoane's contention during the liquidation.

The DA's Penning attributed the city's financial woes to its inability to collect rates and services arrears, reportedly amounting to R7-billion.

http://www.timeslive.co.za/thetimes/article120112.ece

 

[Pilgrim]

What a bunch of monkeys! Save R1 billion by paying it later? What the F do they think will happen on next years balance sheet? Is that R1 billion gona be magically missing?

I.D.I.O.T.S.

 

[rebel998]

I did work for another state institution and nearly had to close my business due to non payment as well.

If you moan and bitch they appoint another contractor to perform the work.

 

[davemc]

Government is fast equalling: DO NOT WANT

 

[DreamKing]

good for AA/BEE

 

[Albereth]

Hardly feel sorry for Masana. It isn't that they hadn't been chasing after a lucrative SAP implementation, or that they don't have their own issues regarding paying their own employees. Maybe a few individuals got burnt who ought not to have.

2010 spokesman was on radio and she said that as far as the stadium goes Ginnaker (?) have been paid up to date and would continue to be paid. She couldn't comment about her colleagues - which immediately arouses suspicions that there is pooh somewhere in the city.