Council loses US$1,8m in botched deals

25 Aug, 2021 - 00:08 0 Views
Council loses US$1,8m in botched deals Harare City Council

The Herald

Farirai Machivenyika Senior Reporter 

Harare City Council (HCC) lost over US$1,8 million in two separate deals for refuse trucks after the supplier failed to deliver some of the vehicles in the first contract and supplied others that did not meet specifications in the second transaction.

 Mass Breed Investments, trading as FAW Zimbabwe, was contracted by HCC council to supply 30 refuse compactors on May 11, 2017 in a deal worth US$3 095 514.

The company was engaged again on September 25 of the same year for the supply of 10 double skip bin trucks valued at US$1 529 999.

However, the company only supplied 15 trucks under the first deal prejudicing council of US$1,55 million while in the second deal, the company supplied single skip bin trucks instead of double bin skip trucks costing council approximately US$330 000.

Yesterday, council officials led by acting Town Clerk, Engineer Mabhena Moyo appeared before the Parliamentary Portfolio Committee on Local Government over the botched deals.

Mr Moyo said HCC paid the full amount for the supply and delivery of the 30 refuse compactors on May 23, 2017 and they were supposed to have been delivered within two weeks but the company failed to meet its contractual obligations.

He added that the HCC engaged FAW Zimbabwe on several occasions on the delayed delivery as per contract but the engagements were fruitless with the company writing to Council on July 14 of the same year seeking extension of delivery time attributing their failure to deliver within the stipulated time frame to non-movements of funds (forex) by both their local bank and the RBZ. 

The company then promised to deliver on August 4, but once again failed to deliver and only delivered 15 trucks in mid-August.

“City of Harare continued to engage FAW on the non-delivery of outstanding 15 Refuse Trucks and until the 6th of July 2020 where FAW Zimbabwe wrote to City of Harare changing goal posts alleging that City of Harare was obliged to facilitate the procurement of foreign currency from RBZ. However, in terms of the contract City of Harare had no obligation to secure availability of forex on behalf of the supplier.

“On 6th of July 2020 FAW Zimbabwe also sought for a top up of the contract price for them to deliver the remaining 15 Trucks despite the fact that they were paid the contract price in full. In essence this was tantamount to contract variation on a breached contract,” Mr Moyo said

In the second contract FAW Zimbabwe supplied 10 single skip bin trucks in February 2018 instead of double bin skip trucks as per contract specification.

Acting HCC Chamber Secretary Mr Warren Chawawa said council had engaged their lawyers, Mbidzo, Muchadehama and Makoni to pursue the matter with FAW Zimbabwe to deliver the outstanding 15 refuse compactors and reimburse the variance for the 10 trucks that did not meet the tender specifications.

Council officials that did not carry out proper due diligence resulting in council taking delivery of wrong skip bin trucks are now facing disciplinary action while the local authority has adopted new standard operating procedures to prevent such instances from recurring. 

Mr Moyo said council was failing to meet its obligations to residents because of the botched deals.

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