Treasury urged to fast-track payments to housing contractors

127

Gweru (New Ziana) –TREASURY should expedite payments of funds to companies contracted to build houses throughout the country to enable them to carry on with their work and to ensure the amounts are not eroded by inflation, a senior official has said.

National Housing and Social Amenities Permanent Secretary, Joy Makumbe, said this on Monday during a tour by the Parliamentary Portfolio Committee on Local Government, Public Works and National Housing, of a block of flats being constructed in Senga suburb, Gweru, the Midlands province.

The Government awarded the tender to a local construction company, Pevimag, to build four blocks of flats in the suburb in February this year and expects them to be completed by November this year.

Makumbe said the Government should also consider paying the contractors a portion of the amounts in foreign currency to enable them to purchase essential materials and to store value.

“It could be better if the contractor was being paid on time. There has been a challenge of payment certificates,” she said.

“His contract is in United States dollars but when he gets paid it is in Zimbabwe dollars, and sometimes the money comes two to three months after the payment certificates would have been submitted, resulting in the value being eroded.”

She urged the legislators to assist her Ministry in lobbying Treasury to disburse a portion of the payments in United States dollars and to release the monies on time.

“If they could pay some of their payments in US dollars that would go a long way with regards to preserving value and seeing the contractors completing the work,” she said.

Makumbe said Pevimag Contractors had promised to expedite the work if they were paid, so that it could meet the completion target.

Pevimag managing director, Peter Majengwa, said delays in payments were slowing progress on the four blocks of flats, which were now at deck level.

“We should be at second floor level but unfortunately, we have monetary constraints,” he said.

“Imagine we have outstanding payment for March and we are in August. As a private contractor, we improvise and end up getting money from the bank to make sure that work proceeds.”

As a result of the financial constraints, the company had 50 people on site, down from 150 when it started the project.

Majengwa said he had to take a loan from the bank to carry on with the construction, leaving him with huge debts to suppliers and workers.

Meanwhile, Makumbe said her Ministry was exploring Public-Private Partnerships (PPPs) so as to meet its target of constructing 225 000 housing units by 2025.

New Ziana

Comments are closed.