Formation of Cooperative Apex Body; Dispute between Altitudes Building & Civil Contractors and King Sabata Dalindyebo LM; Sona SBD Perspective; with Deputy Minister

The Portfolio Committee received a briefing from the King Sabatha Dalindyebo Municipality (KSDM) regarding its dispute with Altitudes Building and Civil Contractors involving challenges with the Mahlungulu housing project, and was also updated on the formation of the South African National Apex Cooperative (SANACO). The Committee heard that the Mahlungulu housing project challenges had started during December 2023, when the provincial Department of Human Settlements (DHS) had changed the payment method and stopped making tranche payments to the municipality. A value-created payment method had been introduced, and this had caused a lot of delays in receiving payments. The unilateral decisions taken by the DHS had resulted in the changing of projects halfway through, when the contractors had already bought material because they were not aware of the changes introduced by the Department. After several contractors had withdrawn from the project, Altitudes had been awarded a tender to build 20 houses, but payments had been erratic since December 2023, when the payment method had changed. The contractor had eventually abandoned the site due to late payments. After deliberations with the DHS, a commitment had been made to settle the outstanding balance with KSDM before end of February, and the municipality would then settle the Altitudes invoice. Members wanted to know how much money had been spent so far on the Mahlungulu project, because only six houses were delivered; commented that the problems had been caused by the provincial DHS by reducing the number of housing units from 60 to 20; and asked how many contractors had not been paid by the municipality. The Department of Small Business Development briefed the Committee on progress made in profiling cooperatives and the finalisation of the formation of the Cooperative Apex Body -- the highest-level organisation in the cooperative structure formed by secondary and tertiary cooperatives. It would serve as the mouthpiece of the cooperative movement, and promote the interests and aspirations of cooperative members through carrying out functions as outlined in the Cooperatives Act. The Act specified penalties on any organisation that unlawfully claimed apex status, or used the term “apex” as part of its name without being duly registered. Members commented that the country seemed stuck with the concept that cooperatives should be in agriculture, and suggested it was important to look at cooperatives operating in all the economic sectors. They wanted to know how SANACO was going to get funding, and enquired what consequences would follow for departments not following government's policy of support for cooperatives.