20 November 2017

Namibia: GIPF Rejects Shanghala's N$10m Bill

The Government Institutions Pension Fund (GIPF) blocked attorney general Sacky Shanghala's plan to force them to pay a South African law firm about N$10 million to investigate how the pension body should operate.

The Namibian understands that there has been a tug-of-war between the attorney general's office and GIPF - a state-owned pension fund administrator worth close to N$100 billion - which provides retirement, death and other benefits to government workers.

The attorney general is not only facing resistance from the GIPF, but senior government officials said Prime Minister Saara Kuugongelwa-Amadhila and President Hage Geingob support the GIPF's position not to pay Shanghala's South African lawyers.

We could not verify the name of the law firm.

Shanghala refused to comment on questions sent to him three weeks ago about this story.

Finance minister Calle Schlettwein confirmed to The Namibian yesterday that his ministry was asked by the Office of the Prime Minister to pay two invoices worth N$10 million for legal services provided to the GIPF.

Schlettwein, however, said the finance ministry had nothing to do with the transaction as it was done through the Office of the Attorney General.

Three people with direct knowledge of this matter said the attorney general was rebuffed by the GIPF since last year in his efforts for them to pay the law firm he had appointed. The issue of who should pay the bill has still not been resolved, sources said, but the Prime Minister, as head of government, is dealing with it.

The officials declined to be named because they are not allowed to discuss confidential matters with the media.

Officials familiar with this case said the GIPF's chief executive officer, David Nuyoma, refused to accept a document prepared by the South African lawyers through Shanghala.

Nuyoma said he is not aware of a legal opinion facilitated by Shanghala's office.

"We don't have information to that effect," Nuyoma told The Namibian last week.

However, officials briefed about this matter said Shanghala wanted the GIPF to pay the lawyers for investigating the restructuring of the GIPF.

It is not clear what exactly the restructuring entailed. The Namibian understands that Shanghala went to South Africa last year for about a week, and when he came back, he arranged a breakfast meeting with Nuyoma.

The attorney general allegedly tried to force Nuyoma to pay and implement the restructuring of the GIPF, people familiar with this matter said.

The GIPF boss refused the advances by the attorney general, and reported the matter to the Prime Minister's office to explain why they would not pay the lawyers hired by Shanghala. The GIPF falls under the OPM.

People briefed about the matter said Kuugongelwa-Amadhila supported Nuyoma. She agreed that the GIPF should not pay the South African firm. She later briefed Geingob about the stand-off between Shanghala and the GIPF.

Geingob is said to have agreed with the stance taken by Kuugongelwa-Amadhila on the matter. The PM's office did not respond to questions sent to her this week.

The Prime Minister's spokesperson, Saima Shaanika, on Thursday said she would "revert" regarding the questions for the Prime Minister, but never did.

The Namibian understands that Nuyoma referred Shanghala to finance minister Calle Schlettwein when he was being pushed to pay the South African company.

The finance minister has been a headache to Shanghala. Sources said the attorney general had complained to State House two months ago that senior officials were leaking information. Some of the leaked information implicated him.

The finance minister has constantly questioned contracts involving the attorney general, such as the Kora All Africa Music Awards in which government lost N$28 million, and the N$35,4 million legal fees paid to United Kingdom-based lawyers.

Shanghala's camp has been on a campaign to discredit Schlettwein, but the finance minister has Geingob's support.

The Namibian reported last month that Shanghala's job is on the line. Officials familiar with his situation doubted that he will retain his position as attorney general after the next Cabinet reshuffle, which is expected early next month after the Swapo elective congress.

It's unclear whether his situation has improved.

News about the GIPF stand-off with Shanghala comes after several government agencies secretly complained to The Namibian that Shanghala has been legitimising questionable deals, such as the N$35 million paid to lawyers in the United Kingdom, and the N$211 million Ondangwa airport expansion deal.

The Namibian reported last week that Shanghala had advised works minister Alfeus !Naruseb to use his ministerial power to order the Namibia Airports Company to award a tender which the board believed was inflated by N$52 million, and was awarded without the correct procedures being followed.

The N$210 million tender was for the phase two rehabilitation and upgrade of the Ondangwa airport. It was awarded to China State Construction Engineering Corporation by the suspended NAC chief executive, Tamer El Kallawi, but cancelled by the new board last year.

The NAC believes that some government officials received bribes of around N$50 million to push the Ondangwa airport contract. Shanghala still advised the minister to force the NAC to award the contract to the same company, despite these concerns.

Shanghala is not new to controversy. He has previously gotten away with clear-cut conflict of interest cases, such as an investigation he carried out into the N$5,6 billion oil storage facility at Walvis Bay.

He led an investigation last year which implicated his friend and business partner Leevi Hungamo, who is the permanent secretary of the National Planning Commission, and his right-hand man, Chris Ngaamwa, the chief legal adviser in the attorney general's office.

Hungamo was last week found not guilty of all charges relating to the oil storage deal against him. The court found that government could not put up enough evidence to support the charges against him.

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