Mass housing fallout rages

Essential information about the mass housing initiative was reportedly kept quiet by the line minister to justify the stoppage of the project.

12 September 2017 | Government

The minister of urban and rural development, Sophia Shaningwa, and other high-ranking officials are accused of being sparse with the truth about the disgraced multibillion-dollar mass housing programme.

The minister is reportedly trying to “save face” after President Hage Geingob put an abrupt stop to the mass housing project after she had made a submission to cabinet justifying the stoppage of the project, presumably as an attempt to “stop the bleeding”.

The perception this created was that there was widespread corruption in the awarding of the tenders.

NHE insiders claim that the cabinet approved Shaningwa's submission without any further digging.

One of the things they feel should have been considered was a subsequent N$3.5 million report by quantity surveyors, which found that the prices of the mass houses, contrary to public perception, were in fact not inflated but were below market value.

The sources, preferring anonymity, further said that the NHE at no point during the execution of the first phase of the mass housing project had received any money from central government for it.

Instead, the NHE had borrowed N$220 million from a local institution to capitalise the first phase of the mass housing project.

They insisted that not a cent of the project money was unaccounted for at NHE.

Despite these facts having come to light, the insiders say cabinet and Shaningwa preferred to remain silent while former NHE CEO Vinson Hailulu's public image was tarnished.

“The withdrawal of the mass housing project from the NHE was a vote of no confidence in the parastatal. None of the key allegations minister Shaningwa had presented to cabinet were substantiated.

“Yet, the government did not come out and put the record straight. They want to catch Hailulu by artificially elevating issues to corruption levels,” the sources said

The explosive accusation levelled against Shaningwa and other officials come after the NHE board accused Anti-Corruption Commission (ACC) director-general Paulus Noa of dereliction of duty for not following up on possible fraud and corruption reportedly emanating from an investigation by Deloitte & Touche.

The sources claim that Shaningwa, not the NHE board, had handed over the Deloitte report to the ACC and demanded further investigation into certain alleged irregularities in the awarding of certain mass housing contracts.

Noa refused to do any investigation, arguing that it was an administrative matter that should be dealt with internally.

Deloitte report

The insiders claim that the Deloitte report was not a forensic investigation, but merely an assessment of the NHE board to familiarise itself with the workings of the parastatal.

This assessment cost the cash-strapped parastatal more than N$750 000.

From discussions on the Deloitte report at an NHE board meeting on 17 January, the report “overall” showed that the NHE books “were not in order and require rectification”.

Findings ranged from duplicate entries in the loan book, as well as missing files and documents.

The new board under the chairpersonship of Sam Shivute then was of the view that disciplinary measures should be taken against senior employees responsible for recurrent wrong entries.

Deloitte on 7 March presented a report to the NHE board on an additional audit carried out on certain aspects of the loan book.

It pointed out that client data was not fully maintained.

Deloitte suggested that the NHE introduce an automated system and improve its historic data, among other things.

However, both Hailulu and former senior manager for technical services and property management Uazuva Kaumbi were exonerated from allegations of misconduct in the awarding of mass housing tenders.

A record exists that showed that Kaumbi had declared his interest on a Lüderitz project in which his son had shareholding in the contractor company. However, the selection and recommendation of the Lüderitz project were done by the technical division, which Kaumbi headed.

It was also found that Hailulu had recused himself from participating in the award of the Otjomuise project because the subcontractor, Titus Nakuumba, is related to his wife.

The NHE tender policy did not compel recusal on account in an event of conflict of interest

The report did, however, find that tender processes related to other NHE programmes outside mass housing, “were in the main [flawed] and disregarded in a number of instances”.

It found that in some cases contractors awarded tenders were not competitive and in some cases contractors were “simply hand-picked”.

Other projects

“The tender policy that was in use at the time of mass housing and during certain awards such as for Oruhapo (contractor for the Lüderitz project) and Kata Investment (contractor for Otjiwarongo project) was not as per best practice,” the March NHE board minutes stated.

Oruhapo got a N$24.6 million contract to build 79 houses.

Kata Investments reportedly did not meet the requirements and failed to meet the deadline for submission of the bid.

It got a N$16.5 million contract to build 71 houses in Otjiwarongo.

Kata Investments CC is co-owned by former President Hifikepunye Pohamba's daughter, Kaupumhote, and Taschiona !Gawaxab, daughter of former Old Mutual Africa's managing director, Johannes !Gawaxab.

Minister Shaningwa was not available for comment. Her office also did not respond to questions sent last week.


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