Today I want to talk about just how the prices that the municipality pays for goods and services are influenced by political and other factors that are ENTIRELY in the control of the Municipality.
Lets assume that the municipality asks for a quote/tender on a specialised service needing to be completed by a certain date that, normally, will cost the man in the street around R1 Million rand.
First round – the municipality puts out a tender. This cost is one that will be borne by the ratepayer.
Second round – Only BEE companies may tender and be considered. In a normal and caring society this is actually the right thing to do.
Third round – the tenderpreneur farms out the specifications to his/her non BEE sub contractors
Fourth round – the municipality through slow practise and a ‘couldn’t really care’ attitude artificially creates an environment leading to lead times being overrun according to the original specification
Fifth round – the municipality informs the tenderpreneur that the job needs to be done within a certain time and the tenderpreneur adjusts his price accordingly.
Sixth round – the successful tenderpreneur now hands the job over to his/her sub contractor who also gets a higher price owing to the urgency.
Now, one would think that this is normal business practice – in order to get a job done within a tight lead time more resources equals a higher cost.
BUT, remember the municipal officials were well aware that the job needed a certain lead time and the tenders were submitted well within time, only for said officials to sit and procrastinate.
I posed this very scenario to a municipal official and the reply; “Well at least the people doing the work get rewarded handsomely!”
BUT, that is not the point. The point is that if our municipal officials were actually effective then the ratepayer would not have to bear that cost, that money saved could be used elsewhere for service delivery or even to pay the salary of additional officials to make our administration even more effective.
If you are a business that has been in a similar situation where you have felt that the municipality is wasting ratepayer money by procrastinating then please leave a comment.
