MANAGERS at the solid waste division of the Windhoek Municipality could not explain how and on which grounds it had spent over N$18 million during the five years of the controversial outsourcing of the city's street cleaning service.
The street cleaning service was outsourced in 2006, under a system called a wards contractor system (WCS).
The division is headed by Benjamin Amuenje. The Namibia Public Workers Union (Napwu) called for Amuenje to be suspended and an audit to be done at the division.
The audit carried out by Ernst and Young unearthed several irregularities at the division, chief among them is the spending of more than N$120 million over five years, instead of the N$102,5 million that was approved by the City Council. The money was apparently for payments to 16 contractors, who were former municipal employees given cleaning contracts in the 2006 restructuring of the division.
The auditors further found that even the council's approved budget of N$102,5 million was still inflated as the cost included N$1,9 million and N$81 000 a year that was only meant to be incurred during the first year of the cleaning contracts.
"The annual escalation on the payments to the ward contractors were less than the large fluctuations in the budget in 2007/2008 and 2009/2010 financial years," the auditors concluded.
Despite the inflated amount in the budget, the division had a total cumulative surplus of N$4,6 million on the ward contractor budget from 2006 to 2010.
The revelations came to the fore amid attempts by the City of Windhoek's management to force Napwu to refund it over N$1 million in audit fees. Management is trying to downplay the findings, claiming that the investigation found nothing to warrant steps against employees in the division.
The entire probe peeped into allegations of unprocedural recruitment and promotion at the division, suspicious spending on purchasing and maintenance of vehicles and the shift system, money used for street cleaning contractors (now known as ward contractors) and host of alleged irregularities surrounding the management of the Kupferberg landfill site and satellite dumpsites.
In the majority of the audit findings seen by The Namibian, the auditors recommended that disciplinary action be taken against those responsible.
"We suggest that the City of Windhoek consider to further investigate the difference between the budget approved by Council and the budget included in the financial records of the City and that the City obtain approval for the excess reflected in the budget," they recommended.
However Council had already taken a resolution that the investigations only found issues of impairment of procedural matters that apparently did not warrant any actions against any employees.
The union had raised concerns that the City's street cleaning budget had been manipulated since certain items were included to fraudulently inflate the budget. Specific items that were questioned in the budget were the retrenchment costs, the cost of solid waste management officers, law enforcement and community officers as well as the cost of vehicles and protective clothing. The auditors' findings detailed a list of unexplained spending.
The budget for the first year as it appeared in the management committee minutes indicates that N$7,3 million was going to the salaries and wages to eighteen employees and one supervisor of each contractor.
The trucks that the city decided to buy for the contractors were to cost N$1,27 million, the auditors found. However the total amount was to escalate at 7 per cent, based on the 2005/2006 values.
Thus the first budget for the first year in 2006 was supposed to be N$16,6 million but the division spent N$17,7 million. For the 2007, the amount was supposed to be N$17,8 million but the division spent N$17,385 million. For 2008 council approved a budget of N$19,073 million but financial records show that N$21 million was spent. In 2009 council approved N$20,4 million but records show that N$21,867 was spent instead. In 2010 council's ward contractors budget was N$21,8 million but N$29,2 million was spent. In 2011 council budget for ward contractors was N$23,3 million but auditors found that N$31,029 was spent. This brought the total amount to N$120 530 222 million over a period of five years.
Auditors said the annual increase in the budget was calculated including staff and vehicles costs of N$1,9 million per annum that was only meant for the first year and should not have form part of the ward contractors cost.
Auditors could also did not find an approved document for the budget as it appears in the city financial records. This budget exceeded the approved budget by N$18 019 509 million auditors concluded.
In their final observation, auditors said a further investigations be carried out to establish proper explanations and documentary proof of approval which they could not get from SWD management.