Namibia’s US$4.3bn mass housing project on hold

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The US$4.3bn mass housing project which was launched last year has been put on hold by the Government of Namibia while the National Housing Enterprise (NHE), the guardian of the project has been stripped of the responsibility. The government took the dire steps after it became apparent that the process of awarding the construction contracts by the NHE was failing. The NHE has also been accused of ignoring government directives and sidestepping procedures.

A technical committee comprising several permanent secretaries recommended that the project should be put on hold because it was not happy with the way NHE had awarded the housing contracts. It is also alleged that there was a breakdown in the relationship and communication between the NHE and the Ministry of Regional and Local Government Housing and Rural Development, which is the parastatal’s line ministry.

The committee accused NHE of awarding contracts to undeserving companies, despite rules stating that local contractors should have a track record of having built a minimum of 250 housing units, technical and financial capacity, quality and extensive experience. Out of 25 companies, 12 were only established over the past two years, which means they did not have the required experience. Three of the companies were registered last year and one was registered this year and the other eight in 2011 and 2012.

The cost of building the houses has also come under scrutiny. Sources said the committee was upset about the fact that NHE was directed that the cost of building should remain below US$ 482 per square meter for the homeless masses to be able to afford. NHE allegedly ignored that instruction and awarded contracts to companies, pushing the cost of building to US$578 per square meter.

The government unveiled the massive housing project last year that will see 185,000 houses built in the next 18 years. The programme will cover urban and rural areas with the aim of satisfying the demand for housing in line with Namibia’s Vision 2030. According to the National Housing Technical Committee the total investment into the programme is expected to be N$45bn (US$4.3bn) of which about N$2.5bn (US$241m) will be spent annually. It was projected that 8,850 houses will be built in the first two years.