WINDHOEK – Several of the companies contracted to build houses under the multi-billion dollar Mass Housing Programme received a contract even though they failed to meet certain tender requirements.
The CEO of the National Housing Enterprise (NHE) made the admission last week Friday during a press conference, saying the NHE had to relax some tender requirements to avoid excluding local companies.
“Some local companies have not meet the requirements but one has to be practical when doing the contracting, otherwise you might end up leaving out all companies. Even if they did not build 250 houses before, one has to consider their capacity,” NHE Chief Executive Officer (CEO) Vinson Hailulu confirmed.
The tender requirements clearly state that companies to be involved in the first phase of the housing programme are to have a track record of housing delivery, which is a minimum of 2 000 houses constructed for international companies and 250 houses for local companies.
Hailulu said if the requirements were not relaxed, some of the local companies contracted would not have been selected. The tender committee comprises of senior staff members of the NHE.
“Well, established contractors can also mess up, so for me the project management system and supervision are important to ensure success. There are companies that have been tasked to construct 20 or 50 houses, so it really does not make sense still to follow requirements in such cases. Given that the capacity is there, “for the projects that have less than 200 units is where we have accommodated local contractors that did not meet the requirement of 250 houses,” elaborated Hailulu.
Hailulu said all foreign companies were screened to ensure that they meet the requirement. There has been a public outcry regarding the capacity and track records of local companies, some of which were only established weeks before President Hifikepunye Pohamba launched the programme last November. However, the NHE CEO shot down the claims and indicated that companies’ performance should be judged when their contracts come to an end. “We have put measures in place to deal with those who do not deliver and they might even be banned from participating during the second phase,” said Hailulu.
Government will subsidise the houses although there is no threshold yet with regard to the cost of one house. “The subsidy will depend on the income of the beneficiary. The price of a house will be determined by the subsidy offered by government,” said Hailulu.
Another requirement is that successful foreign companies give a minimum of 30 percent participation to a local contractor. Power-Oyeno, Calgrow M3, Delta Group Holdings and 7 Sirs Group are all joint ventures formed between local and foreign companies.
Power-Oyeno will construct 2 034 houses in Swakopmund, Calgrow M3 will build 1 191 houses in Windhoek, Delta Group Holdings 400 houses in Swakopmund and 7 Sirs Group 1 595 houses in Walvis Bay. The track records of all foreign companies have been thoroughly checked, said Hailulu, adding that all four foreign companies have all built over 37 000 houses in South Africa.
Asked about media reports that low-cost housing under South Africa’s Reconstruction and Development Programme are of low quality, Hailulu said project managers have been instructed not to compromise on quality. Technical site handovers to all contractors for the construction of houses were conducted last month.
The NHE and the Ministry of Regional and Local Government, Housing and Rural Development have opened a joint bank account in which the funds for the mass housing programme will be kept.
With NHE’s waiting list for housing beneficiaries standing at 17 000 currently, Hailulu encouraged people who fall within the mid-to-low income categories to register themselves at NHE and local authority offices to be considered for entry on the waiting list.
Taxpayers will have to fork out over N$2.9 billion required for the construction of 10 037 houses to be built in towns around the country as part of phase one between 2014 and 2016. Part of the funds will also be used to service 6 457 plots and for the upgrading of 1 227 properties in four informal settlements.
Credit-linked, rental accommodation, social housing and detached or semi-detached, sectional titles and high-rise are the type of houses to be constructed under the programme.
By Mathias Haufiku