The City of Cape Town is investigating syndicates for cases of extortion and kickbacks that are placing R58.6 million in expenditure at risk on transport capital projects.
At least seven major projects have been halted due to safety concerns on-site, ranging from the construction of new public transport infrastructure to road reconstruction and stormwater maintenance, mostly in vulnerable communities, the city’s Mayoral Committee member for Urban Mobility, Rob Quintas, has said in a statement.
“Unfortunately, the brazen attempts from these mafia-style extortionists are only intensifying. They are holding the city and our contractors to ransom and ultimately come at the expense of service delivery. It is completely and utterly unconscionable,” Quintas said.
“I condemn, in the strongest possible terms, the sophisticated extortion syndicates alongside the opportunistic thugs who care nothing for the lives of the communities we are trying to serve, nor those of the hard-working teams attempting to complete these projects on the ground.”
He said projects recently delayed or that have fully ground to a halt “due to threats, intimidation,” and “outright murder on-site” include:
• Construction of new MyCiTi depots on Spine Road and Mew Way in Khayelitsha and Mitchell’s Plain. This is at the heart of operations for the second phase of the MyCiTi bus service. Interference with multiple contractors and extortion attempts in May have set the project back by at least three weeks with R27.4 million at risk in unspent capital budget.
• Rehabilitation of Delft Main Road, from Stellenbosch Arterial to Silversands Road in Delft. This work is critical for commuter safety along the full stretch of the road. The contractor withdrew from the site following the fatal shooting of a staff member on 10 May. A portion of the gravel base of the road section has been left exposed during winter rains. Loss of production totals R13.5 million in unspent capital budget.
• Upgrading of various roads and associated works in Bishop Lavis.
• Roads resealing and stormwater repairs project in Delft.
• Roads rehabilitation in Kalksteenfontein.
All the projects have been beset by threats and intimidation, and the associated loss of production amounts to R16.9 million in unspent capital budget.
In addition, threats and extortion attempts have delayed the Walter Sisulu-Lindela roundabout project in Khayelitsha by three months. R600 000 is at risk.
Installing traffic calming measures and footways, including sidewalk and embayment construction in Brooklyn, have also been disrupted. The contractor suffered multiple threats and instances of intimidation of staff on-site. On 17 May, criminals threatened staff and loaded a plate compactor onto a bakkie. A sum of R195 000 is unspent.
“It is utterly dismaying to see the rampant and relentless criminal interference with projects designed to improve and protect the lives of ordinary, honest residents,” Quintas said.
The Mayoral Committee member for Safety and Security, Jean-Pierre Smith, said contractors had reported several cases to the SA Police Service, and the city’s safety and security directorate is actively investigating extortion cases but cannot share details as investigations are ongoing. He said it appears that the criminals are local but criminal interference in construction work is getting “more and more syndicated.
“Extortion is not limited to the Western Cape and the City of Cape Town. Certain syndicates are local and specific to certain areas, but there are definitely national syndicates that operate on a very large scale across South Africa, targeting almost all spheres of government.”
Smith added that the syndicates operated in several ways to gain access to businesses.
“They create circumstances of conflict between contractors and labour on-site and then insert solutions either actively or passively, which include people or companies that they know will provide kickbacks.”
They threaten staff, contractors and officials to comply with their requests as they know who they are.”
He said the syndicates were responsible for site disruptions, theft and damage to assets, threats of violence against employees if they do not comply with requests, “and in extreme cases, maiming or executions to prove a point.
“We have reason to believe the funds are all paid through kickbacks in a pyramid scheme. We recently had an instance where subcontractors have demanded shares in a company to allow construction to continue without disruptions,” Smith said.
The public is urged to phone 0800 11 0077 if they have any information linked to extortion.