Durban's controversial Essence Festival may attract big names like Grammy winner Jill Scott and Bishop TD Jakes, but the event has caused nothing but headaches for the city.
First, Durban raised a stink when it emerged that costs for the 2016 event, modelled on the New Orleans Jazz and Heritage Festival, had ballooned from an initial R35-million to R95-million, then to R103-million.
Now it emerges that the former spokesman for Jacob Zuma, Vincent Magwenya, who runs a marketing and communications company, as well as several other subcontractors, are owed more than R4-million for rendering services at last year's event.
They blame Republicom owner Qondisa Ngwenya, the main contractor for last year's event.
Magwenya, founder and CEO of Conversations Media and Conversations Group, said his company had been contracted by Republicom but was paid only a portion of its bill.
The event, which the city punts as a global showcase and celebration of empowerment, music and entertainment, as well as of business, lifestyle, wellness, food, fashion, arts and crafts, was held in September last year.
Said Magwenya: "My company was sub-contracted to provide stakeholder reputation management. We have not been paid in full. The total of what we have been paid is less than 50% of the total amount outstanding ... Promises of payment were made to us."
He said that despite repeated e-mails and calls to Ngwenya, he had not been paid.
Ngwenya admitted that he owed suppliers R4.2-million due to the cash-flow problems of two of his clients, who were in arrears to his company to the tune of R20-million. He said he had informed the municipality of his precarious situation and had taken the two companies to court in a bid to recoup the money."We've been communicating with all the suppliers that have not been paid and we have informed the municipality about the nonpayment," Ngwenya said.
"The reason why suppliers were not paid is because of a cash-flow problem on our side. That problem arose because we were running multiple projects with different clients. Unfortunately, two of our clients owe us money in the region of R20-million ...
"So this had a negative impact on the Essence suppliers. We have never had a situation like this before because we have always had enough cash reserves," Ngwenya said.
Durban Tourism's senior manager for marketing and communications, Sbu Zondi, confirmed on Friday that several subcontractors had complained of nonpayment.
"Due to contractual obligations we cannot give their details unless they give us their consent. But the issue here is that they are owed monies."
Zondi said the municipality had tried to help the subcontractors recover what was due to them from Republicom and had communicated in writing and had several meetings with Ngwenya's company to facilitate the payments.
The city did not divulge how much money was paid to Republicom.
Zondi said that last year the city invested R12.5-million in hosting the Essence Festival. The Sunday Times understands that a large part of this was paid to Republicom as the main contractor.
In August last year it was reported that a marketing company had been paid to provide security at the 2016 Essence Festival and that the city had forked out close to R200,000 on "refreshments" at a club-cum-restaurant as part of the festival. This was reported in a document produced by the city's internal audit unit, which reviewed the R95-million expenditure incurred by the city for hosting the five-day event.
However, Phillip Sithole, the former head of the city's business support, tourism and markets unit, dismissed the document, saying it lacked comment from project managers and the heads of relevant units.
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