BCC gives up on cremator as bill reaches R1 million

Vusumuzi Dube, Online News Editor 

THE Bulawayo City Council (BCC) has given up on a cremator that has been stuck in South Africa for the past seven years after the contractor failed to pay duty to enable its delivery in the country.

The cremator has since accrued a bill of R1 million, together with storage fees with the initial contractor- Masen Engineering- now advising the local authority that it is cheaper to purchase a new modern cremator than paying what is owed to the South African Revenue Services (SARS).

It has since also emerged that the director of Masen Engineering was now late which could create complications in completing the paper work to get the cremator as council had discovered that the company had been a one-man entity. The local authority flighted the tender for the cremator that was set to be installed at the West Park Crematorium in July 2013, with Masen Engineering being awarded at a cost of US$121 400, with the company being paid US$97 120 which was 80 percent of the tendered price as advance payment.

However, the company failed to deliver the cremator at the agreed 15 weeks’ period, revealing that they were facing challenges in Durban after the shipping agent had not indicated that the cremator was goods in transit hence SARS demanded that they be paid duty.

In September 2017, BCC resolved to take over the contract and deal directly with SARS as compared to paying more money to the contractor who had failed to deliver. However, since then the local authority’s efforts to get the cremator delivered had hit a brick wall, which has since seen the bill to SARS accumulating to ZAR1.1 million.

“Management was approached by the contractor and he advised that it was not such a wise decision to pay that amount to SARS in order to facilitate the release of the cremator which was now obsolete. His advice was that, a new cremator could cost council close to a million rand and the storage money could be used to purchase a new cremator. 

“He further advised that in his own opinion council should just abandon that cremator because of the costs and the fact that some components of the cremator which were in that container were no longer usable,” reads a council report.

SARS lawyers had also demanded that the local authority pay for the cremator by early last month or they would dispose of it.

“The bottom line was that council has already lost US$97 120. The bill for the lawyers was not yet available. We requested for it and they are still compiling it. His estimate was around R172 539 and we think we could work with this figure pending compilation. The storage charges were RI 190 763 to date. SARS had promised that they were locking the debt at that figure as long as we pay before 6 October. These were the cost of unlocking the cremator at Durban and in addition there were also costs of moving the cremator at Durban in addition, there were also costs of moving the cremator from Durban to Zimbabwe and the installation costs,” reads the report.

Council’s procurement unit has since also noted that new cremators in China range from US $40 000 to about $110 000, depending on their sizes.

“The most expensive was the large size which may not be necessary at the moment given the uptake of cremation in our culture. It was important to note that the founding member of this company (Masen Engineering) was now late and it appears it was a one-man company and there were outstanding documents which included the bill of lading. 

“It was not clear why the agent was holding on to the bill of lading and the possibility was they had not paid in full. This would be pointing out to further costs to the council,” reads the report.

As per the final decision, the local authority resolved to abandon the cremator to avoid paying further charges but instead pursue a court application for the recovery of the US$97 120 that was paid as deposit to Masen Engineering.