The Windhoek Observer recently reported that the ministry wrote off a penalty amounting to approximately N$400,000.00 that Likoze Investments should have paid for not meeting contractual deadlines.
The company became liable for the penalty after causing delays in the first phase of the construction of a rural water pipeline between Katima Mulilo and Ngoma in the Zambezi Region.
Sources said this week that Likoze Investments continues to get special favours from the ministry even in the second phase of the project.
Minutes of a meeting held between various stakeholders revealed that the ministry agreed to make a separate payment to Likoze, rather than the joint venture company contrary to the normal practice.
Likoze Investments only has a minority stake in the joint venture with 2M Civil Contractors, and up to now the ministry had always made full payments to 2M Civil Contractors, which then subsequently paid Likoze what was due to it.
This was done with the approval and blessings of a consulting engineering company, Element Consulting Engineers.
2M Civil Contractors was paid as the main partner in the joint venture, because ultimate responsibility for any liabilities on the project rests with the main contractor.
However, because Likoze was not being paid for its unsatisfactory work that they constantly had to redo, the company then decided to by-pass both its partners and the engineering company in charge of oversight and approached the ministry for direct payment.
Sources within the ministry considered the request from Kamwi’s company for direct payment highly unusual because it violates basic industry norms.
The project has reached its second phase but, as was the case with the first phase, it allegedly faces serious delays once more as a direct result of Likoze. The first phase of the construction of the rural water pipeline, which the contractors should have completed back in 2012, still had work outstanding and Likoze could therefore not receive full payment.