NIP rot exposed

Irregular activities at the Namibia Institute of Pathology (NIP) are being laid bare in a series of document leaks, which include details of lavish expenditure, massive salary hikes, the blocking of an audit investigation and excessive overseas travelling.

At the centre is suspended CEO Augustinus Katiti.

The NIP, which came into existence in 2000 by grouping 23 health ministry laboratories into a corporate entity, has previously been seen as the poster child for state-owned enterprises in the country. According to 2017 figures, the NIP employs 450 people and manages 40 laboratories.

For the financial year ended 31 March 2017, it recorded revenues of N$635.3 million and profit of N$121 million, while total assets were valued at N$550.8 million.

However, this belies the shocking management that has been exposed in documentation seen by Namibian Sun.

The serious allegations against the CEO include overspending on subsistence and travel by over N$1 million after being already awarded a N$2.5 million budget.

Katiti is said to have undertaken trips to the US, Sweden, Austria and South Africa.

Also under scrutiny is a trip to Italy undertaken by Katiti and five of his executives, which cost the SOE N$400 000.

The NIP top brass went to Italy to purchase lavish office furniture to the tune of N$11 million, according to an insider privy to the affairs of the parastatal.

It is also alleged the NIP, despite having a fulltime business development executive, went ahead and spent N$1.4 million on consulting services.





A consultancy firm, Rubiem, had been appointed to conduct business development services for NIP even though the SOE had a dedicated unit headed by Jennifer Kauapirura.

A board member raised the alarm, saying she found the appointment of Kauapirura strange, given a recommendation that an existing staff member should be appointed to the post.

The Katiti-headed management is said to have ignored the recommendation and proceeded to incur an extra cost of nearly N$500 000 for the company.

Kauapirura also needed N$50 000 to start her research for business development.

Business development costs are said to have escalated from N$505 906 in March 2015 to N$1.2 million in 2016, while N$3.6 million was budgeted in the 2016/17 financial year.

“On top of that, was it necessary to get Rubiem, a business transformation consultant to do the business development at N$700 000 (per year). We should not allow this as it is an unproductive waste of money, seeing that the private share is down 22% against the budget,” the board member said.

The NIP management is also accused of blocking a forensic investigation into its affairs, despite board approval granted by then chairperson Mandela Kapere.

The audit committee had suggested a budget of N$150 000 for this investigation.

Huge spending on advertising and marketing services was also questioned by some members of the board.



European sojourn

Meanwhile, the trip to Italy further raised the ire of the board.

“A trip to Italy for senior NIP staff to evaluate furniture for the new head office at N$400 000 is unacceptable and cannot be justified,” the board member said.

The lavish new N$45 million NIP offices were inaugurated by President Hage Geingob in August last year.

While a board recommendation indicated that salary increases for NIP staff be capped at 8%, Katiti and his team received 11% hikes from 2014 to 2016.

“Personnel costs are now approaching 80% of operating costs and bonuses are paid without objective evaluation criteria being met,” the former board member said.

It was also claimed that despite year-end profits under Katiti's management, the suspended CEO refused to pay over dividends to government.

“I read in newspapers daily how they waste money. Why should they waste our money?” he allegedly told an NIP board member.

Other alleged irregularities include overspending on staff training, while it was observed that NIP had poached well-trained staff members from private pathology laboratory, Pathcare.

NIP had budgeted N$3.2 million for training purposes, remarkably up from the budgeted N$2 million in March 2014, despite no in-house training programme being observed.

The former board member also said board packs, which included key information, were often submitted late for scrutiny, giving the board little time to question financials and leaving it with no option but to rubber-stamp decisions already taken by Katiti.

A former board member said both the health and public enterprises ministers were informed of the alleged irregularities at NIP.

When contacted for comment yesterday, health minister Bernhard Haufiku declined to speak on the matter, referring questions to the NIP board chair.

Public enterprises minister Leon Jooste also declined to comment, and instead said Haufiku should be approached.

Board chair Diina Shuuluka, while acknowledging Namibian Sun enquiries, said a statement would be released soon.

Katiti this week pleaded his innocence in a letter to Shuuluka, which was reported in The Namibian.

According to the report, Katiti castigated the board for focusing on issues like buying furniture from Italy and writing to politicians, while the organisation is struggling to handle basic blood tests.

“In terms of this resolution, all transactions must be approved by at least two authorised signatories, which even includes maximum withdrawals of up to N$50 million in a single day,” he said.

Katiti said the furniture was bought when there was no board, since the term of the previous one had expired.

The furniture was not bought from Italy, he said, but from R Navarra Shopfitters and Joiners in South Africa.



OGONE TLHAGE