PM ‘not to blame’ for oil storage facility costs

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Staff Reporter

Keetmanshoop-Prime Minister Saara Kuugongelwa-Amadhila is not to blame for the escalation of costs of the oil storage facility under construction at Walvis Bay, as she had nothing to do with it, her office said yesterday.

The cost of the storage facility is reported to have escalated from an initial amount of N$3.7 billion in 2014 to some N$5.5 billion in 2016 – said to have been the result of foreign exchange rate fluctuations.

A local daily paper reported recently that the prime minister is also partly to blame for the cost escalation. The report claimed that although foreign exchange fluctuations have been blamed for the high construction costs of the storage facility, other unnamed sources have cast the blame on Kuugongelwa-Amadhila.

This is for allegedly having rejected the advice of certain officials to put in place a strategy to reduce exposure to foreign exchange rate fluctuations.
The OPM, however, flatly refuted the allegations in a statement issued by OPM spokesperson Saima Shaanika yesterday, saying the allegations were unfounded and aimed at tarnishing the name of the prime minister.

The OPM said Kuugongelwa-Amadhila, in her capacity as minister of finance at the time the tender was awarded, was not responsible for overseeing the project, as this responsibility lay in the hands of a ministerial committee composed of several ministers, including herself, and chaired by the director-general of the National Planning Commission (NPC).

The ministerial committee was served by a technical committee of permanent secretaries and other senior government officials from various government offices, under the chairmanship of the permanent secretary of the NPC, Leevi Hungamo. This technical committee reported to the ministerial committee – not to the minister of finance, the OPM said.

The ministerial committee was very clear that all matters regulated by law were to be dealt with in strict compliance with such laws, including the Tender Board Act, which govern the awarding of tenders, the State Finance Act, which governs government payments and other financial rules. Thus the former finance minister was in no position to have any influence over the project, as all was done in accordance with Namibian laws, the OPM noted in its statement.

“In terms of the financial rules, payments for local contracts are to be made in the local currency and, secondly, in terms of the State Finance Act all accounting officers are required to strictly comply with that Act and are individually accountable for that,” read the statement.

The OPM further added that contractual commitments and payments thereunder are made by accounting officers subject to laws and financial regulations, not on the basis of ad-hoc directives by politicians, or at the discretion of officials. Therefore, it said, no one can rightfully point a finger at the PM for the price escalation of the oil storage facility.

“The prime minister, thus, challenges those accusing her of being responsible for the cost escalations to provide evidence to substantiate their claims,” the OPM advised.

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