NIP under fire for wasted N$7m
16 October 2019 | Government
Jooste yesterday said the “legal fee [N$5.6 million] is of particular concern to me and in my opinion beyond acceptable norms.”
These legal costs relate to internal disciplinary actions against six employees instituted over the past year. One of the cases was the disciplinary action against former NIP CEO Augustinus Katiti, who was fired last year. Documents released this week showed that each disciplinary case was given to a different law firm, resulting in six law firms handling six individual cases.
The minister stressed yesterday that in cases where suspensions were condoned, he made it “clear to boards that the investigations and disciplinary processes must be concluded as soon as possible.”
“I also want to make it clear that individual board members may be held personally liable for any undue financial consequences, to ensure that boards conduct a thorough cost-benefit analysis based on solid evidence to guide their decision-making,” he warned.
NIP documents shared on public forums recently show the company spent just over N$1.5 million on acting allowances for seven senior NIP managers between June 2018 and September 2019.
NIP chief internal auditor Mecky Nghipandulwa, who served as acting CEO from 2018 until September this year, earned N$699 704 according to the documents.
The seven NIP managers who acted in higher positions reportedly received acting allowances in addition to their usual pay, although Namibian Sun was unable to obtain confirmation of these expenses from NIP by the time of going to print.
Speaking about the extra spending necessitated by disciplinary procedures, Jooste said he was “definitely not happy about this, as it has resulted in diverting money meant for productive activities towards acting allowances and legal fees.”
The minister has frequently criticised the “suspension culture” at public enterprises, including the lengthy time officials stay home with full pay and benefits.
Yesterday, he said: “I want to see a situation where these suspensions are a thing of the past.”
He added that where suspensions are approved by the ministry, it is critical they are concluded quickly.
“I always make it very clear that the disciplinary process should be concluded as a matter of urgency, and in cases where it leads to a dismissal, the recruitment process should be equally expedited to mitigate the negative consequences.”
On the way forward, Jooste said the NIP board has to “weigh the consequences and cost of prolonged legal processes versus alternative solutions to restore the corporate governance integrity as soon as is possible.”
He said the problems at NIP must be handled by the board and the acting executives, who must at all times “act in the best interest of the entity to find the most acceptable solution.”