Grootfontein CEO’s N$2,9m golden handshake

The Grootfontein Municipality paid its former chief executive officer (CEO), Kisco Sinvula, N$2,9 million – a decision that has been criticised by a council member at the north-eastern town as a waste of public funds.

This settlement is among other negotiated deals that the municipality was locked in worth around N$9 million since last year.

Sinvula was suspended in March 2022 after being accused of 27 charges ranging from abuse of authority, fraud and bribery and refusing instructions.

Chairperson of the management council Alpheus Nghikevali told The Namibian yesterday that the settlement agreement between Sinvula and the council is a waste of public funds.

“The man was not found guilty, so it is a waste of the municipality’s money, that is the money we had to settle and it is a lot of money to the municipality. The funds are meant for development of the town and it is the municipality’s money, they could have used it to maintain the town, however, they decided to pay him such an amount,” Nghikevali said.

“After he was found not guilty, he was supposed to be reinstated as he was willing to work, however, the council decided to terminate his contract and pay him. Such a settlement is a waste of public funds.”

The municipality’s acting CEO, Indileni Lungameni, confirmed the settlement to The Namibian yesterday
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The settlement agreement, which The Namibian has seen, shows that the municipality terminated Sinvula’s contract and opted to pay him out for the remaining two years.

The decision for his settlement was made during the municipality’s special council meeting on 24 May 2023.

The municipality said the relationship between the council and the CEO had deteriorated beyond repair.

“[The] Grootfontein Municipal Council shall pay Sinvula an amount equal to the remaining contract duration period, salary and benefits at the date of termination in line of notice [sic].

“The parties agree that the employment relationship is terminated effectively, no party shall have a claim against the other arising out of the employment agreement, and save for the employee remaining entitled to use any legal remedy at his disposal to enforce the payment terms,” the settlement agreement letter noted.

The municipality added that keeping Sinvula on will hinder it from its obligation of fulfilling its mandate of service delivery as required by the law.

Sinvula was appointed as the Grootfontein Municipality’s CEO in March 2020. He previously served as the Kunene chief regional officer.

Part of what led to Sinvula’s suspension is the three-year contract entered into between the municipality and a company called Frontier Multi Industries in November 2021 to clean the entire town of Grootfontein until October 2024.

Around N$399 000 was to be paid to the company per month, according to the contract.

The company took the municipality to court in July 2022 after it stopped paying for services rendered, citing breach of contract.
The municipality had not paid for invoices submitted by the company for March, April, May and June 2022.

Despite the municipality’s breach of contract, Frontier continued to render cleaning and waste management services to the town.
Frontier Multi Industries then took the municipality to court for failing to pay for services rendered in September last year.

The Windhoek High court ordered the municipality to pay the company N$4,3 million.

The High Court ruled that the municipality failed, neglected and refused to timeously pay the company’s invoice of N$1,8 million.

“No valid reason or grounds has been advanced by Grootfontein for the purported termination of a withdrawal from the contract. Such conduct on the part of the municipality amounts to unjustified and material breach of its contractual obligations, which goes to the root of the agreement between the parties.

“Grootfontein’s conduct amounts to prevention of performance as unjustified lack of cooperation, which entitles Frontier to cancel the contract and seek damages for breach of contract,” Frontier argued in court.

The municipality said that the contract between Frontier and Sinvula was unlawfully done and should be declared void, which the court found not illegal.

They added that Frontier and Sinvula amended the price as per the bid documents, by adding an additional N$69 093 and N$517 per load.

“In addition, the bid amount of Frontier was recorded on 20 August 2021 at N$330 050, which corresponded with the amount in the award letter signed by Sinvula dated 14 October 2021,” court documents read.

They added: “However, the agreement states a total of N$399 143 per month plus the N$517 per skip load for illegal dumping heaps clean-up. This indicates more than a 20% increase, the limit being 15%. It is a blatant violation and, therefore, Sinvula and Frontier acted unlawfully and the agreement is thus void.”

The municipality has been ordered to pay another company, Teya Investment Number Eighteen CC, after failing to pay it for work done.

During August 2022, the municipality agreed to pay Teya Investment an amount of N$2 million as a settlement on their interest claim.

According to documents seen by The Namibian, the settlement agreement entered between the two is a discounted figure as the interest payable was calculated at N$7,8 million.

Grootfontein has been a hotbed of political power struggles for decades.

The Namibian reported two years ago that the Grootfontein municipality was yet to implement recommendations of a 2019 report which revealed widespread maladministration, financial mismanagement and corruption among council employees and former councillors at the town.

The report, which has been kept under wraps since it was finalised in 2019, revealed that some employees and councillors at the municipality have over the years been engaged in dubious land deals.

The report also unmasked that municipal bosses have been paying themselves irregular housing and vehicle allowances without owning houses and cars.

It further revealed that top managers at the town have been receiving skyrocketing subsistence and travel allowances to treat themselves to high-end hotels.