‘City owes us R4,2 mln’
The controversial security contract between Msunduzi Municipality and Khuselani Security and Risk Management (KSA) came under the spotlight again in the high court on Tuesday.
This time, KSA was claiming the municipality did not pay them for July. They said they were owed R4,2 million. The company also wanted the CFO to be jailed for contempt of court.
After being called before a judge in chambers the matter was resolved for now.
KSA and the municipality agreed that the company will now be paid in terms of an agreement reached in February. If KSA feels it is entitled to more, it can bring an application to claim the difference.
The application was brought by KSA, who wanted the court to order the municipality to pay it the R4,2 million.
In addition, it wanted the City’s chief financial officer, Nelisiwe Ngcobo, who is also the acting municipal manager, jailed for 30 days.
Security boss Mahomed Yacoob said in court papers that Ngcobo was in contempt of a court order granted in May, where the municipality undertook to allow the company to continue providing security services. Yacoob said that Ngcobo is aware of this and is personally liable to approve all payments to contractors. He said that an invoice issued for July has not been paid.
Yacoob added that when the municipality was contacted, an official, Balan Naidoo, said he did not know when payment will be made. He also said the reason for non-payment is because the finance committee refused to authorise it as a sundry payment. However, Yacoob added that sundry payments have been made to KSA for the past eight months.
Naidoo also confirmed that KSA’s documents were in order and that payment was ready to be “released”. He added that from his experience, he is aware that if everything is in order, payment can be made in an hour. Despite demands, no payment has been received.
“The vast majority of funds received by KSA are allocated to the payment of staff salaries for its security guards who have worked at various sites for the municipality.”
Yacoob said that some staff members have not received their full salaries, while others have not been paid at all. In essence, 742 staff members have been adversely affected. They all are prejudiced and have responsibilities and commitments.
They have threatened to embark on industrial action, which will result in KSA becoming insolvent.
Ngcobo said in reply that the arrangement was that the municipality will provide security services in accordance with “the 78% formula for sectoral wage increase and not the 96% formula” until the main dispute is resolved.
She said that previously the municipal manager Sizwe Hadebe, who is now suspended, used to authorise the payment in terms of the higher formula but she has refused to do so because it is unlawful.
She explained that KSA sent invoices amounting to R9,4 million. She and other municipal officials agreed to pay R5,2 million. She said she informed Yacoob that the amount claimed was calculated at the wrong rate.