THE transfer of N$95 million into a TransNamib account on March 31 was in the national interest to urgently repair the railway line between Kranzberg and Tsumeb, Finance Minister Saara Kuugongelwa-Amadhila said in Parliament on Thursday.
Responding to Swanu MP Usutuaije Maamberua's question on the transfer, Kuugongelwa-Amadhila said Cabinet had approved the transfer because the rail repairs were urgent in order to prevent a disruption of rail services.
Maamberua had suggested that the Ministry of Works and Transport had hoarded funds just to transfer the N$95 million at midnight on March 31, which is the end of Government's financial year.
"We cannot compromise the national interest and say you cannot access the contingency fund," said Kuugongelwa-Amadhila.
Maamberua in return said that the ministry could have released money from the contingency fund sometime between December 2011, when the Minister of Works and Transport, Erkki Nghimtina, first asked Cabinet to authorise money for emergency rail repairs, and March 31 this year.
He asked why the money was transferred into a TransNamib account: "Was TransNamib the contractor for the job?"
Further, Maamberua wanted to know who had made the transfer. Nghimtina replied that the then Works Permanent Secretary, George Simataa, had done it.
Nghimtina said during November and December last year the ministry received reports of six derailments due to dilapidated railway lines. The ministry then approached Cabinet to ask for funds for urgent repair and rehabilitation of the affected railway line sections.
Nghimtina said the ministry deemed it urgent to start with repairs to the Kranzberg-Tsumeb section because it carries the bulk of rail traffic and is crucial to economic activities in the north. In March this year, he said, while work was being done on the Kranzberg-Tsumeb line, it became clear that the work would not be completed before the end of the financial year.
In addition, flash floods had washed away the railway line near Aus. The minister said the ministry was compelled to act urgently to avoid disruptions to the work in progress. The works and finance ministries then agreed that the works ministry could use a portion of the funds approved by Cabinet for the two identified priority lines.
Nghimtina said the N$95 million was then transferred into the Government Upgrading of Railway Infrastructure Account - an account in existence for more than 13 years - as "cash at hand" for all necessary repair work. He said the ministry is the custodian of this account, and not TransNamib.
Nghimtina further said that he is aware of the Deloitte&Touche audit report released in February, which pointed out a lack of financial control at TransNamib.
He said TransNamib has no authorisation to spend money from the Government Upgrading of Railway Infrastructure Account without ministerial approval.
"With this in mind, there would be no question whether the ministry should trust TransNamib because the money cannot be moved without the knowledge of the ministry," Nghimtina said.
Asked what the balance of the Infrastructure Account is, Nghimtina said the full N$95 million is still in the account. A tender for the repairs at Aus was advertised, and closes tomorrow, but the complete rehabilitation process is yet to be completed, the minister said. Passenger train services will not be allowed on the Kranzberg-Tsumeb line until the work has been completed.
Nghimtina said TransNamib is not achieving maximum efficiency because of the ageing infrastructure causing constant disruptions. He said TransNamib's financial performance has been hit hard by stiff competition from road transport operators. Maamberua also asked Prime Minister Nahas Angula as chairperson of the State-owned Enterprises Governing Council why TransNamib and other SOEs are in a precarious state.
Angula said the governing council is merely an oversight body, which can only act on issues if ministries report them to the council.