Namhealth Administrators announced yesterday that it had entered into "a smart partnership" with MetHealth Namibia Administrators to run the Public Services Employees Medical Aid Scheme (PSEMAS).

The agreement eliminates any threat to Namhealth's ambition of retaining the tender as Methealth was its main competitor, favoured by consultants and the technical committee of the Ministry of Finance and the Office of the Prime Minister.

Namhealth is owned by the Swapo Youth League, the Swapo affiliated trade union federation - National Union of Namibian Workers (NUNW) - and a South African company called Prosperity.

Methealth, which the technical committee and medical scheme experts earlier found to be best suited to run PSEMAS, is owned by Sanlam, Metropolitan and a black empowerment outfit.

Namhealth was to relinquish the tender it had run for about three years at the end of May.

But a day before the tender was to be awarded in April, the NUNW issued a press statement accusing the Tender Board of corruption when dealing with Government contracts and of sidestepping black empowerment companies.

The Tender Board, which is composed of permanent secretaries from various ministries, then twice delayed taking a decision to award the PSEMAS tender.

The tender process was subsequently scrapped.

Insiders said this was an attempt to give Namhealth another opportunity to strengthen its bid.

Yesterday Methealth and Namhealth issued a joint press statement on their partnership saying, "the rationale behind such a bold step is in the public interest".

When tender applications closed on Tuesday, Namhealth and another company, yet to be identified, were the only two firms competing for the PSEMAS contract.

Kobus Struwig, Director of Prosperity Namibia, said in a telephone interview yesterday that the joint venture's tender had been submitted under the name of Namhealth, but that the entire work would be "outsourced" to Methealth.

Asked why they would give the work to Methealth despite dismissing an assessment by consultants that Namhealth did not have proper systems to administer the tender, Struwig said "if we had to go into this as opposition it would have become a price war and a political war".

Methealth's owners reportedly believed that no matter how competitive their tender was they would have lost as their political connections were not strong enough.

"Swapo through Namhealth cannot afford to shoot themselves in the foot," by giving the tender to another firm, said a source.

"It's a question of 'if you can't beat them, you join them'," said the source, adding that for Methealth the partnership was the best option of "staying in the business".

Struwig said Methealth was also politically connected through people like Vekuii Rukoro, the Managing Director of Sanlam.

Rukoro, a former Attorney General in Government, is a Swapo member.

Struwig recalled that "last time around it became such a public nightmare of a mudslinging contest between political parties".

The two companies were trying to avoid "cutting each other throats to get the tender" this time, he said.

Struwig also dismissed the findings of Pinnacle Management Consultants, who said Namhealth's work had not been up to scratch and may have lost Government money.

He claimed that Prosperity has the "most technologically advanced system" in Africa.

Methealth referred all queries to Prosperity Health, which is the main player in Namhealth.

Government has the biggest and most lucrative medical care scheme that pays out nearly N$300 million a year for more than 100 000 employees and their dependents.

If they get the tender the two companies believe they will control 90 percent of the private medical aid scheme, representing 80 000 members.

It is not clear when a final decision will be taken on the tender.

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