Tweya confirms investigation into Telecom deal

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Windhoek

Telecom Namibia is being investigated over claims of irregularities in the manner the company procured a new billing system in 2013, a process that could result in heads rolling at the parastatal, or even former employees being recalled to face disciplinary action.

Responding to questions from a representative of the Rally for Democracy and Progress (RDP), MP Mike Kavekotora, in the National Assembly on Thursday, information minister Tjekero Tweya revealed that Ernst&Young already submitted a draft report with recommendations last month. “Further action and the completion of the investigation will reveal possible irregularities by Telecom Namibia staff and consultants,” Tweya said.

Kavekotora asked Tweya if there was any need for the replacement of the Cisco billing system with the Juniper system. Telecom in 2013 replaced its Cisco-based MPLS system, that was acquired for N$150 million in 2006 with the Juniper-based MPLS system, which cost the company N$120 million.

Tweya and Kavekotora are both intimately familiar with Telecom’s operations, having both worked at the company.
Kavekotora served as Telecom’s business development and marketing general manager from 1996 to 2000, while Tweya served as the manager of employment, advancement and administration between 1997 and 1999.

Tweya said Telecom’s decision to look for an alternate billing engine was based on the “promised but not realised functionalities of the current system that lacks scalability and flexibility”. The minister said the system is unreliable and is inundated with operational hiccups. “To date, no fully functional platform as scoped is delivered,” he revealed.

Since 2011, Telecom spent N$49.8 million in consultation fees on the project, progress payments and for the establishment of a fully serviced server room and hardware. Tweya said the actual billing expenses amount to N$22 million.

The Namibian reported last month that former Telecom Namibia managers are now Juniper country agents, responsible for servicing the network. Quoted sources indicated that the said managers had resigned from Telecom after the Juniper deal was signed.

Despite the 2011 deal, Telecom continues to make use of the Cisco network. Telecom was once one of Namibia’s premium State-owned enterprises, but over the years poor management and dodgy procurement deals left the company begging for cash.

Kavekotora also wanted to know who would bail out Telecom with the remaining installments. “Does the process of the billing system’s replacement reflect a situation that Telecom Namibia is a hostage of self-interests of Telecom managers and consultants?” Kavekotora asked.

Tweya said Telecom will have to make use of its own resources to settle the outstanding amounts. “Regarding the remaining installment, Telecom Namibia has one bond of N$54 million maturing in February 2016, which can be redeemed out of own resources,” said the minister.

Telecom’s purse continues to shrink in size and Minister Tweya attributes this to the launch of its new billing system, the downgrading of its Fitch (creditworthiness) ratings and the impairment of its joint ventures in Angola and South Africa.

Telecom earlier this year received N$400 million in dividends from Namibia Post Telecommunications Holdings. According to Minister Tweya, the money was used to redeem bonds of N$293 million, while the remaining N$107 million was applied to short-term facilities held with First National Bank and Nedbank.

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