Home News Beefmaster, Sol ’seal deal’

Beefmaster, Sol ’seal deal’

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The Sol Plaatje Municipality has approved a resolution to write of millions of Beefmaster’s debt in exchange for Beefmaster assisting in repairing the ailing Homevale Wastewater Treatment Plant. File image

Other local businesses also wish to enter similar agreements with the municipality and have questioned how this agreement was arrived at.

Sandi Kwon Hoo

THE SOL Plaatje Municipality council has approved a resolution to write off R6.5 million in debts in exchange for Beefmaster’s assistance in repairing the ailing Homevale Wastewater Treatment Plant.

Beefmaster has undertaken to bring its own security to the site and to clean the area.

Other local businesses also wish to enter similar agreements with the municipality and have questioned how this agreement was arrived at.

“Perhaps we can also qualify for a rebate if we fix some potholes,” said one local business owner.

Northern Chamber of Commerce and Industry (Nocci) president Pieter Botha stated yesterday that they would enter into future discussions with Sol Plaatje Municipality.

The recommendation was made to council in February after Beefmaster had proposed to make a once-off settlement of R6.5 million to Sol Plaatje Municipality to settle an “ongoing dispute”.

In exchange, a balance in respect of rates valuation, electricity and water amounting to R57.3 million, along with interest of R9.8 million, would be written off.

According to a lawyer’s letter dated February 20, it was indicated that Beefmaster’s offer to pay was not “an acceptance of liability but merely a gesture of extending the proverbial olive branch in these trying times”.

“The dispute prevents our client’s accountants from accurately reflecting the true state of affairs. Our client remains steadfast in its denial regarding any liability towards Sol Plaatje Municipality in relation to any of the arrears involved.”

It was noted that the municipality and Beefmaster had over recent years attempted to reach an amicable solution.

Council advised that the KINA incentive would be rescinded as from February 25, that all accumulated debt be written off and that 100 percent of all future billings would be recovered from Beefmaster.

The KINA incentive is in the form of certain concessions to property tax and service charges provided to businesses across Kimberley subject to certain criteria.

The supply chain executive at Beefmaster Group, Roelie van Reenen, stated that, in terms of the agreement, Beefmaster had undertaken to assist Sol Plaatje Municipality to repair the Homevale sewage plant.

“We were informed that the plant has not been functioning for the past two years and has been leaking sewage into Kamfers Dam”.

Van Reenen indicated that they would use their own workforce and cover the costs of the repairs.

“The agreement will be subject to the municipality providing a plan to Beefmaster on how they would maintain the plant for the next 24 months upon completion of the project

“The company started work on the project in June and is investing a few million rand into the project, in order to get the plant up and running within the next seven months.

“We have committed to assist in these repairs in an effort to ease the burden on the municipality. We felt that it was the right thing to do, given that we have been invested in the community for over 18 years and want to continue to play a role in the improvement of socio-economic conditions in the area.”

He indicated that the project would create about 20 temporary jobs.

“This will help to raise the socio-economic profile of the immediate Kimberley community over the medium term.”

Van Reenen added that although the maintenance and upkeep of public infrastructure fell outside of the responsibility of Beefmaster Group, the group had decided to help due to the impact of the plant’s continual breakdown on the safety and investability of the area.

“This news has been welcomed by local businesses and residents in the area, who rely on the treatment plant to effectively dispose of waste in the area.

“Beefmaster Group and the Sol Plaatje Municipality will be working together on the repairs. Beefmaster Group is providing skilled labour over the medium term to fix, repair and maintain the treatment plant.”

He believed that finding a solution required input from various stakeholders.

“We consider any problem that may impact on the safety and potential investment in the community as part of a collective to solve. If a business has the expertise to help solve a problem that causes a huge risk to many, it should do so.

“Since its establishment in Kimberley in 2003, Beefmaster Group has created 600 jobs and continues to make an impact in the area.

“The group intends scaling up its production plant in Kimberley by investing more than R30 million into equipment upgrades and creating an estimated 30 new jobs. Furthermore, it will also spend approximately R1.2 million in improving the socio-economic conditions of impoverished areas in and around the Kimberley area, given the dire need, representing an increase of 70 percent compared to 2020. This is significant given the recent spate of disinvestment from corporate companies in areas where communities are reliant on them for job security, income and upliftment of socio-economic conditions.”

The CEO of the Beefmaster Group, Louw van Reenen, stated that the company was offered an economic incentive in 2003 by the municipality as part of its strategy to attract companies to invest in the Kimberley area.

“Sol Plaatje Municipality offered the Beefmaster Group an economic incentive to establish its abattoir facility in Kimdustria, to continue doing business in the area and to employ people from Kimberley to work at the facility. This incentive included lower, more attractive rates for municipal services such as water, electricity and rates. In 2012 the municipality stopped applying the economic incentive, without warning or discussion.”

He indicated that the amount of R57.3 million and interest of R9.8 million formed part of the economic incentive, as it had been applied by the municipality over the last nine years.

“We have been in discussions with the municipality for many years to find a way forward on the matter.

“In line with this, Beefmaster Group recently committed at a council meeting to pay a lump sum amount of R6.5 million to the Sol Plaatje Municipality. This was agreed to in good faith with the understanding that the economic incentive would be reinstated and applied in arrears, hence the R57.3 million and interest of R9.8 million would no longer be seen as ‘owing’ to the municipality and falls away.”

He pointed out that the R6.5 million was not owed to the municipality but related to economic incentives that the municipality should have applied to Beefmaster Group’s rate bill since 2012, but failed to do so

“As part of their commitment to working with the municipality to solve some of the challenges that continue to hinder the economic progress of Kimberley and impact all of its residents, Beefmaster Group has agreed to fix and repair the Homevale Wastewater Treatment Plant.”

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