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Two Routine Road Maintenance (RRM) projects to the value of R116m will see small, medium and micro enterprises (SMMEs) access economic development opportunities and create scores of jobs for the people of the Naledi Local Municipality over the next three years.

This was the message of the South African National Roads Agency SOC Limited (SANRAL) during its flagship Taking SANRAL to the People programme in Vryburg, in the Naledi Local Municipality recently.

Acting Mayor for Naledi Local Municipality, Cllr Lukas Ekkelton, expressed his gratitude to SANRAL for coming into his constituency to engage all relevant stakeholders and was particularly pleased with the economic development opportunities that the current and future projects would bring, benefitting not only small businesses and local labour, but in fact the region at large.

The two RRM projects cover 155.70km on the N14 Section 9, N18 Section 4&5 and R31 Section 1 as well as 163.50km on the N14 Section 8, N18 Section 2 and N18 Section 3.  The main contractor was appointed at the start of this month, so the way is now being paved to ensure that 50% of the contract, i.e. R58m that must be subcontracted, benefits as many of the SMMEs as possible. The scope of work includes general road maintenance of the road reserve, grass cutting, storm water drainage, fencing, road signs, potholes or road surface repairs, etc.

With President Ramaphosa having identified infrastructure development as the flywheel that will kickstart the SA economy post-COVID-19, SANRAL is committed to expanding the net of economic inclusion for emerging black businesses to participate meaningfully and profitably in its projects.

“We understand that the tendering process can be challenging, particularly for start-ups, and as such, all contracts have a training component that is geared to mentor, train, develop and capacitate sub-contractors,” explain SANRAL Project Manager, Luyanda Mashaba.

Furthermore, SANRAL recently signed a memorandum of understanding (MOU) with the South African Forum of Civil Engineering Contractors (SAFCEC), that prioritises development of SMMEs in the road construction industry.

That MOU with SAFCEC is specifically geared to enable mentorship, development, capacity building and training of small contractors, giving them the skills and knowledge needed to access economic opportunities and participate profitably in road construction and maintenance projects.

“Apart from SANRAL sharing vital project information with the audience, this engagement session was also an opportunity for robust and frank discussions, which afforded our stakeholders a platform to voice their concerns and seek clarity on terms of project participation. We are satisfied that we have addressed these and remain open to ongoing engagement in a bid to facilitate genuine transformation that will give SMMEs an opportunity to grow and prosper,” said Jullecsia Saul, SANRAL Stakeholder Coordinator for the Northern Region.

SANRAL remains committed to SMME development and community engagement in the quest to transform the industry, as well as its overall strategy that is aligned to the government’s National Development Plan.

The supply of appropriate skills in local communities is a central instrument for promoting long-term growth and development of the South African economy and the construction sector at large. The South African National Roads Agency SOC Limited (SANRAL) engaged local communities and businesses of Maruleng Local Municipality in Limpopo Province to inform them of the projects they will be rolling out from February 2021 to July 2022 and how the broader community can benefit.

Speaking to SMMEs and local communities in Maruleng Local Municipality regarding the purpose of the day, SANRAL’s stakeholder engagement coordinator for the northern region, Moloko Masenya, said that these engagements with local business and community are a proactive effort that the road agency uses to bring change in the South African construction and engineering sectors. They also promote SANRAL’s contribution to broad-based black economic empowerment, skills development, and the growth of small, micro, and medium enterprises (SMMEs).

“These projects will only succeed and potentially put the construction industry on the verge of transformation if we work hand in hand with the municipality, traditional authorities, and other stakeholders represented under the Project Liaison Committee (PLC). The opportunities these projects would bring include training of unskilled labour, creating job opportunities  for the local community , and  empowering  emerging sub-contractors under the guidance of the main contractors,” Masenya said.

SANRAL’s transformation officer Tshegare Moletsane echoes the same sentiment: “SANRAL is mindful of the impact of the construction industry, and its procurement has on the people of South Africa in terms of skills development and job creation. We accept the responsibility to provide development support to black businesses through structured development programmes and partnerships with industry players to ensure a meaningful growth of black entities in the construction industry. SANRAL will launch the Supplier Development Desk Portal to publish projects relevant to local communities and SMMEs across South Africa. This will enable them to see where the opportunities are,” Moletsane said.

SANRAL, through these four projects, will train and develop local labour to attain the relevant skills in the construction sector. This will leave a long-standing mark for SMMEs in Maruleng Local Municipality, as they will be able to bid for bigger projects in the future using the experience learned from the SANRAL projects under the mentorship of main contractors.

Expanding on the projects that are in the pipeline in Maruleng Local Municipality SANRAL’s project manager, Lawrence Chauke said that SANRAL will introduce four major projects in the Maruleng Local Municipality. Tenders will be evaluated by consultants and Project Liaison Committees (PLC) to ensure transparency and equal participation.

“The first project is the Routine Road Maintenance (RRM) of National Route R36 from Greater Tubatse Border to Greater Tzaneen Border, the R40 from Mpumalanga Border to Ba-Phalaborwa Border, R526 from Mica to Ba-Phalaborwa Border and R531 from R40 to Orpen Kruger Gate. The contract duration for this contract is 36 months. The execution of the work is estimated to start on 1 February 2021.”

Chauke adds: “The second project is the upgrading of Provincial Road D3878 from Calais to Ga-Sekororo. SANRAL will be implementing the project on behalf of Road Agency Limpopo (RAL). Construction is expected to start by July 2022.

The third project is the upgrading the four-way crossroad into a new grade-separated interchange on national route R40 and R527/D5012 at Hoedspruit. Construction is expected to start by April 2023. The fourth project is the Road Marking of National Roads in the Limpopo Province. Construction is expected to start by February 2022”.

The appeal to prevent the South African National Roads Agency SOC Limited (SANRAL) to claim guarantees from the joint venture that stopped work on the Mtentu bridge project in 2019 has been dismissed by the Supreme Court of Appeals (SCA).

The judgment between Aveng Strabag (Africa) (Pty) and Strabag International GmbH (ASJV) vs SANRAL was handed down electronically by circulation to the parties’ representatives on Friday, 13 November.

“We are happy that the court has dismissed the appeal with costs. Our position that there was no Force Majeure, and as the contractor refused to return to site after the suspension of works was lifted we had no option but to terminate for abandonment of the project,” said Craig Mc Lachlan, SANRAL’s N2 Wild Coast Road lead project manager.

SANRAL will now proceed with calling in both the performance and retention guarantees to help cover the additional costs that will be incurred to complete the project with a new contractor. “The contractor and not the taxpayer should be held liable for all additional costs,” said Craig McLachlan

SANRAL had advertised the re-tender for the construction of the Mtentu River Bridge and associated roads on the N2WCR project. The re-tender closes on Friday, 19 February 2021.

According to court documents, at the heart of this appeal was whether SANRAL was restricted by the underlying contract between it and the joint venture ASJV from demanding payment in terms of a performance guarantee issued in its favour by the second respondent, Lombard Insurance Company Ltd. The guarantee was issued pursuant to a written construction contract, concluded between SANRAL and the ASJV in August 2017, for the construction of the Mtentu River Bridge on the N2WCR.

In 2019 both SANRAL and ASJV purported to terminate the contract. The following circumstances led to the termination of the contract.

From 22 October 2018 there were disruptions of the works by some members of the local community. The community raised a wide variety of demands including employment issues (split of labour between different villages, hiring of local semi-skilled labour who had failed assessments, wages, additional job opportunities), prioritisation of SMMEs from immediately adjacent to the project, disbanding the Project Liaison Committee, removal of certain persons linked to the contract and the  use of a local quarry to supply aggregate. Some of the disruptions took a violent turn and threats were made potentially endangered ASJV staff and workers. The engineer, acting on SANRAL’s instructions, suspended the works between 22 October 2018 and 13 January 2019. After agreement was obtained from all stakeholders on 08 January 2019 for work to resume without disruption the suspension was lifted.

Against this backdrop, the joint venture, on 30 January 2019, gave SANRAL a notice purporting to terminate the contract, effective seven days after the notice. The ASJV stated that the civil unrest and commotion at the site constituted force majeure which had prevented it from performing the works for a continuous period of 84 days. Having given notice of termination, the ASJV considered itself entitled to be released from further performance of its obligations under the contract.

SANRAL denied the existence of the force majeure and asserted that, if it ever existed, it had to come to an end on 9 January 2019 following a meeting with the local community. It had communicated this to the ASJV and instructed it to resume the works on 14 January 2019, which it refused to do. Accordingly, SANRAL contested the ASJV’s entitlement to terminate the contract. It gave the ASJV until 4 February 2019 to withdraw its notice of termination and to return to site, failing which SANRAL would itself exercise its right to terminate the contract.

On 5 February 2019, after the ASJV had still failed to return to site, SANRAL terminated the contract. The dispute as to whether the disruptions at the construction site consituted force majeure, which entitled the ASJV to terminate the contract, was referrred to artibration.

In the wake of the second purported termination of the contract, the ASJV sought SANRAL’s assurance that, pending the arbitration proceedings, it would not call up the guarantee. SANRAL not only declined to give such assurance but notified the JV of its intention to do so. As a result, the ASJV applied to the Gauteng Division of the High Court, Pretoria, for an interlocutory interdict, restraining SANRAL from calling up the guarantee, pending the outcome of the arbitration proceedings. The ASJV asserted that SANRAL’s call on the guarantee would be unlawful, as it had not met certain conditions in the underlying contract which limited its rights to call up the guarantee. ASJV lost this initiall case but subsequently were granted leave to appeal to the SCA. The case was heard by the SCA on 14 September 2020.

In court papers Judge TM Magoka said that the ASJV has failed to show that SANRAL was not entitled to payment of the guarantee before any underlying dispute between them is determined. Accordingly, the appeal must fail.  The appeal was dismissed with costs, including the costs of two counsel.

Transport Minister Fikile Mbalula says the N2 Wild Coast Road (N2WCR) project is well underway and will continue to create thousands of new jobs and economic opportunities in line with the new Economic Reconstruction and Recovery Plan.

Genuine concerns raised by local communities would be addressed by the national Department of Transport and the South African National Roads Agency SOC Limited (SANRAL) but government would not allow people with hidden agendas to stop development, said Minister Mbalula.

The N2 Wild Coast Road was one of the massive infrastructure projects to which President Ramaphosa was referring in South Africa’s Economic Reconstruction and Recovery Plan. “Work has begun on this project so when we talk about job creation, when we talk about massive infrastructure build, this is what we are talking about,” he said. “This democratically-elected government is ready to listen to whatever concerns which communities may have but we must differentiate between anarchy and the real demands of the people.”

Minister Mbalula visited SANRAL’s multi-billion-rand N2 Wild Coast Road project to assess progress in the implementation of one of government’s key Strategic Integrated Projects (SIP-3) which will serve as a critical catalyst for economic growth at a national, provincial and regional level.

The project is endorsed by the Presidential Infrastructure Coordinating Commission (PICC) as a catalyst for economic development. It is strategically positioned on the N2, connecting four provinces; Western Cape, Eastern Cape, KwaZulu-Natal and Mpumalanga, traversing the cities and towns of Cape Town, George, Knysna, Port Elizabeth, East London, Mthatha, Durban and Ermelo.

“I started my visit at the Msikaba Mega Bridge construction site, and I was incredibly impressed with the progress being made, the magnitude of the project and the economic development opportunities created for emerging black business and SMMEs on this project,” said Mbalula.

The project is currently in early construction phase and, once completed, the 580m long Msikaba Bridge will be the longest cable-stay bridge in Africa. With a deck height of 194m above the river valley, Msikaba will become the third-highest bridge in Africa and the 133rd highest in the world. Environmental compliance is a core component of all SANRAL operations and as such the cable-stay design will ensure that the construction of the bridge will have no direct impact on the pristine gorge environment almost 200m below.

Mveli Phakathi, a local resident, says he is excited about the fruits that the project will bear for him and the community at large. “This project is a huge opportunity for us to find employment and training opportunities. We will gain valuable skills in building and construction through this project, enabling us to sustain ourselves even when it comes to an end. Those of us who want to build small businesses will benefit greatly, because this project will enable us to provide income for our families,” he says.

The minister also officially opened and handed over two recently completed rural access roads in the communities of Sigidi and Makhwantini in the Alfred Nzo District Municipality of the Eastern Cape province.

In Sigidi, more than 120 locals were involved in the construction of the 10km access gravel road to a surfaced road linking the Sigidi and Mahaha communities in the Amadiba area of Pondoland.  The two-year community development project incorporated a two-year learnership programme, accredited by the South African Qualifications Authority (SAQA), affording community members NQF level 2, 3, and 4 training. SANRAL furthermore prioritised work for 50% women-owned and 70% youth-owned SMMEs.

In Makhwantini, over R28.5 million of the project budget was spent on targeted enterprises including SMMEs and local suppliers. Approximately 10 SMMEs and four local plant hire suppliers participated and benefit-ted from the project, while more than 150 jobs and training opportunities were created for locals.

“While SANRAL has a mandate to fund, build and maintain the national road network, we cannot ignore the importance of rural roads in facilitating economic development access to marginalised communities. Rural roads eventually link up with the national road network, and as we heed the President’s call to use infrastructure development as the flywheel that will kickstart our economy post COVID-19, SANRAL is proud to be widening the net of economic participation opportunities in the road construction sector,” said Mbulelo Peterson, SANRAL’s Southern Region Manager.

These activities form part of the national October Transport Month programme and, in addition to enabling the minister to see first-hand the achievements on the N2 Wild Coast Road, it was also an opportunity to engage with and inform stakeholders of the progress and challenges facing the project.

SANRAL remains committed to prioritising economic inclusion for the affected communities and will, along with the other relevant government entities, continue to engage stakeholders through the various community structures.

Transport Minister Fikile Mbalula will tomorrow visit SANRAL’s multi-billion-rand N2 Wild Coast Road Project to assess progress in the implementation of one of the national government’s key Strategic Integrated Projects (SIP-3) which will serve as a critical catalyst for economic growth at a national, provincial and regional level.

The Minister will also hand over two recently completed rural access roads to the communities of Sigidi and Makhwantini in the Alfred Nzo District Municipality of the Eastern Cape province.

In recognition of the training and development opportunities associated with the building of the rural roads, the Minister will hand over certificates to the SMMEs who were trained and capacitated to participate in these projects.

These activities form part of the national October Transport Month programme and, in addition to enabling Minister Mbalula to see first-hand the achievements on the N2 Wild Coast Road Project, will also help to inform local communities and the country at large as to the progress and challenges facing the Project.