Medupi: Per-hour gain is per-contract loss

2013-08-11 14:00

Smaller contractors on the ill-fated Medupi construction site say their businesses may very well not survive the incessant delays and recurring chaos.

A major emerging problem is that contracts are taking a great deal longer to complete than was originally agreed on, says Wayne Derkson, president of the Laphalale Chamber of Commerce.

A big part of the problem stems from a simple and undeniable fact: the sooner the job gets done, the sooner everybody on the colossal construction site loses his or her inherently temporary job.

Eskom’s representatives openly admit that productivity at the Medupi site is at no more than 8%, says Derkson.

While contractors can claim back extra expenditure directly related to work on the site, they would not be compensated for the extra fixed costs arising off-site.

This means a business that was supposed to spend 10 months completing some task at Medupi, and set up an office in Lephalale, will have to start sacrificing profits to carry the costs of that office as soon as the contracted period is over.

Martin Nel of Baarata, a tiny construction subcontractor at Medupi, says Eskom has, at times, forced subcontractors to make certain payments with promises of compensation later on.

He cites the once-off R2 000 bonus paid to striking workers as part of a settlement early this year to end a drawn-out unprotected strike.

According to Nel, claims submitted in October last year have only recently been approved and he is still waiting for the actual money.

“I’ve already incurred the cost – R400 000,” he says.

Another small business owner who has been supplying components to larger contractors, complains that the processing of invoices also comes to a halt when Medupi stands still for extended periods.

“I can’t pay my own suppliers on time,” he says.

Contractors have no leeway to negotiate conditions of employment with their employees because Eskom insists on site-wide standardisation, says Nel.

A moratorium on retrenchments is wreaking havoc on contractors who have themselves employed people on fixed-term contracts for specific tasks, says another small contractor.

Two of Baarata’s nine employees have reached the end of their contracts, but now the company is being asked to find them new employment, says Nel.

It’s a recipe for disaster when contractors are paid fixed sums for specific tasks, but their employees are paid by the hour, he says.

In practice, the personnel are only really working two or three hours of the eight they get paid for, he claims.

“If you are paying me by the hour to build your house, I’ll keep building for 20 years, but if you’re only paying me R50, I’ll finish it in a day,” says Nel.

Delays at Medupi clearly benefit these temporary workers, who get paid by the hour and have, after several strikes, won a daily meal and free transport to the site as part of their conditions of employment.

“I’ve had 77 strike days since October,” says Nel.

According to him, Eskom has given workers and unions far too much power at Medupi. Full-time shop stewards are earning large salaries and have all been given free iPads, he complains.

“They are being paid to cause s**t,” he says,

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