At least five of South Africa’s 2010 World Cup host cities demands hundreds of millions of dollars back from construction businesses because they colluded and inflated prices when constructing stadiums and other infrastructure for the historic tournament.
The South African Local Government Association said Johannesburg, Cape Town, Durban, Port Elizabeth and Polokwane were overcharged on World Cup projects and could collectively seek as much as 3.9 billion rand ($394 million) in total in damages.
“They want their money back,” SALGA chief of operations Lance Joel told The Associated Press. “That’s a lot of money.”
The potential claims follow a larger investigation by the Competition Commission, where 15 companies agreed to pay a total of $147 million in fines in a fast track settlement to avoid prosecution for “rigged” projects in South Africa between 2006 and 2011, which include World Cup work.
One of the construction companies fined, WBHO, said the only way to guarantee to local World Cup organizers in 2006 that the stadiums could be built on time was for “the larger construction companies to meet.”
But SALGA estimated in documents that collusion led to Cape Town being overcharged by up to $220 million for the picturesque ocean-side stadium – which cost close to $730 million – and Johannesburg by as much as $61 million for work on and around the showpiece Soccer City, which hosted the World Cup final. – Associated Press
SA towns seek R3.9bn reimbursement from 2010 World Cup builders. Photo: MailGuardian
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