Geordin Hill-Lewis | Cape Town will not negotiate with construction mafia

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A housing project is at risk due to threats and intimidation from mafia-like extortion rackets. Photo: Jaco Marais
A housing project is at risk due to threats and intimidation from mafia-like extortion rackets. Photo: Jaco Marais

Thousands of people stand to lose the houses for which they have been waiting for years due to the construction industry in Cape Town being held hostage by extortionists, writes Geordin Hill-Lewis.

Our country received some unflattering international attention last week as The Economist reported that out-of-control organised crime is "blighting South Africa’s economy".

One kind of organised crime which needs more attention is the rise in mafia-like extortion rackets demanding financial benefit under threat of violence against staff and equipment. These criminal operations style themselves as benign-sounding "business forums" and claim to be effecting the "transformation" of the country's economy. No less than 183 major public and private projects — ranging from mining to construction — were affected in 2019, says The Economist, at an estimated loss of R63 billion to the national economy.

READ | Ayabonga Cawe: Construction Mafia - Why our procurement system is a middleman's playground

If anything, things have gotten worse since 2019. In Cape Town, we are witnessing our construction industry being held hostage by extortionists. SAPS has yet to take action against these mafias, who are, for the most part, operating out in the open.

Beacon Valley Housing Project

To understand the full seriousness of this threat, consider the example of two massive planned housing projects being rolled out by the City of Cape Town in Mitchells Plain, one at Highlands Drive and the other in Beacon Valley, which will see 2 352 houses delivered. For many of these prospective beneficiaries, this will be the first time they've ever lived in a brick-and-mortar home, let alone one of their own. Sadly both projects are now so threatened by criminal activity that they are at risk of cancellation, and the Beacon Valley project has been particularly targeted.

Before construction began at Beacon Valley, a public meeting was held with the local community, which was attended by 1 000 people. Strong support for the project was expressed, both by the project's intended beneficiaries and the broader community. The project got underway, with the first stage being the setting up of a site office for the construction company.

Shortly after the site was set up, construction equipment was petrol bombed. Various members of the contractors' staff were threatened and told they would suffer violence if they continued work. In fear, the contractors left the site.

The City immediately went to court to get an interdict against the self-styled "community leaders" threatening the project. The City also drove mediation efforts with these individuals, seeking to get the project back on track as soon as possible. This process collapsed when the demands — various forms of financial benefit from the construction contracts for themselves and their friends — became increasingly outlandish and openly corrupt.

The contractors returned to the site after the interdict was granted, and additional security measures were provided at the site in cooperation with City Law Enforcement and the SAPS. Despite these measures, the violence worsened. When two workers were shot in a drive-by shooting, the contractors disestablished the site and left for the second time.

An even more thorough security plan was then drawn up, which included open public community meetings (at which the community almost unanimously supported the project again), an upgraded security operational plan involving City Law Enforcement, Metro Police, and the SAPS, and the inclusion of local neighbourhood watches in the contractors' security team. Additional funding was provided from the City's budget to allow staff involved in the security plan to work overtime. The contractors nervously agreed to return to the site.

And then, the night before work was due to resume, the construction site camp was petrol bombed. The next day, an officer on the site was assaulted with a firearm, and another was shot in both legs. A machine operator was shot in the chest while working. All of this happened while a large security deployment was present on site. This time the contractors left and made it clear they have no intention of returning.

READ |  John Dludlu: Construction Mafia - Time to regulate business forums

Thousands of people stand to lose the houses for which they have been waiting for years.

The City now has a terrible decision to make. To coax a new contractor into taking on the job, we'd need to spend tens of millions more on 24/7 heavily armed security with dogs, razor wire and more – essentially turning the site into a prison (the current quote for this work is R38 million). This must be either be paid for by ratepayers, at the cost of higher rates for everyone or must come from the existing budget for this project, which means fewer homes delivered. And there is no guarantee any of this will work. Or we can cancel the project and move on with other projects elsewhere.

Beyond the obvious harm to these particular housing beneficiaries, the construction mafia threatens every Capetonian. The construction industry employs some 160 000 people in Cape Town and contributes R20 billion to the local economy each year. Industry bodies say thousands of these jobs and billions in value are under immediate and dire threat, a threat which is growing in severity each day.

We can't give in to thugs

One thing is certain, in Cape Town we will not negotiate with the construction mafia.

There is no good to come from mediating with thugs. The construction mafias must be brought to justice.

We've called for SAPS to form a specialised task team on extortion. After initially positive responses, there has been no progress. This is now essential. Only SAPS has the intelligence gathering and surveillance powers necessary to disrupt organised crime and hunt down the ring leaders. The question must be asked – with all of the crime intelligence capabilities at SAPS' disposal, why are arrests so rare?

The lack of action from SAPS on this issue thus far is just one of the myriad reasons I am concerned by the observations made in by Judge Thulare from the bench of the Western Cape High Court that the upper ranks of SAPS in the province has been infiltrated by gangsters.

READ | Jenni Irish-Qhobosheane: 'Kingmakers' - Construction is not the only industry facing extortion

The other key solution is the devolution of more policing powers to the City. Our Metro Police and Law Enforcement are ready to play a greater role in criminal investigations and in preparing dockets for prosecution. In fact, we are already doing more of this than ever before. Now we need the formal devolution of these powers so that we can do even more.

I have already made a case for this publicly, as have legal scholars and crime-fighting experts. Our Metro Police need to be explicitly empowered by law to investigate crime, gather evidence, and present prosecution-ready cases to the National Prosecuting Authority, instead of having to hand over cases to SAPS at an early stage. The Justice Minister already has the power to action the City's request for broader investigative and prosecutorial powers.

Police devolution will not only help us address the growing problem of extortion rackets I've described here, but a range of other kinds of serious crimes which we do not currently have power in law to fight.

Of course, there is nothing stopping the National Government from both improving the crime-fighting service delivery of the SAPS and empowering the City with broader policing functions. We need all the help we can get to make Cape Town safer for Capetonians, their businesses, and their homes. This includes the homes of poor Capetonians that will not be built if the construction mafias are not speedily brought to heel.

- Geordin Hill-Lewis is the City of Cape Town mayor.

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