RCC company bankrupt

THE State-owned construction material supplier Bricks and Concrete Industries (BCI) is said to be in a financial squeeze and no longer able to honour its financial obligations.

Sources privy to the company’s financial books say the wholly-owned subsidiary of the Roads Contractor Company (RCC) is technically bankrupt to a point where it is unable to pay employees’ Pay As You Earn (PAYE) tax deductions and Value Added Tax (VAT) to the Receiver of Revenue. Some workers of the company have also called The Namibian, complaining about the non-payment of their salaries.BCI is further alleged to be struggling to honour contractual obligations with its suppliers, one of which is reported to be the cement producer, Ohorongo. BCI allegedly owes Ohorongo about N$15 million and the factory has suspended supplies to it.Reliable sources indicate that the financial quagmire at the state-owned entity has occurred as a result of financial mismanagement and lack of business acumen despite BCI being involved in a construction industry considered lucrative and booming. BCI’s customers are mainly Chinese contractors who snatch up Government construction jobs. RCC’s chief executive officer Engelhard Haihambo, a BCI director under whose authority BCI falls, declined to comment last week. A secretary at his office said Haihambo referred The Namibian to Eveline Namoya, the RCC’s head of human resources, who appears to have been instructed to answer questions related to BCI activities. All Namoya was prepared to say was that she could not comment on the issue.BCI’s managing director, erstwhile trade unionist Jacob Nghifindaka, was not at the office when The Namibian called for comment on Thursday. Nghifindaka’s contract is said to have ended in December last year but he is still on the job.Ohorongo spokesperson Carina Sowden said on Friday that BCI is ‘currently within their approved credit limit and their payments are being paid as per agreement’ between BCI and Ohorongo.’Kindly take note that we regard all customer information as highly confidential and we would not be prepared to divulge any information regarding that or enter into any correspondence in that regard,’ Sowden said.The RCC board chairman, City of Windhoek transport executive Ludwig /Narib, was not available for comment on Friday as he was busy with a strategic planning workshop of the City of Windhoek.BCI was bought by the RCC in September 2005 to complement the RCC’s services on commercial and business principles.It has been operating independently and has allegedly seen a high staff turnover in the last three years.BCI specialises in the provision of bricks, precast panels and building blocks, ready-mixed concrete, pavers, garden and road kerbs.The Namibian reported last month that BCI was blamed for the delay in the construction of the new Ministry of Finance office building because it had supplied substandard building materials.The concrete used by the Chinese contractor New Era Investment was said to be unusable following tests conducted by an independent testing facility in South Africa. The tests allegedly showed that approximately a quarter of the ground slab was ‘substantially below acceptable standards’, according to the project’s principal agent, Klaus Brandt.New Era was instructed to dismantle the slab, a lengthy process that would take two months.A full investigation into the cause of the problem is underway and it is expected that if fault is officially laid at BCI’s door, New Era will be entitled to claim compensation for the additional cost of the replacement as well as any penalties arising from the delay.