R50 million loss: NW Housing Corporation looted, mismanaged and on brink of bankruptcy

19 July 2017

North West residents' access to affordable housing continues to diminish after the latest audit report revealed that the North West Housing Corporation (NWHC) recorded a net loss of R50,7 million in the 2015/2016 financial year. This is on the back of the Auditor General (A-G) being unable to form an audit opinion in the past 10 years due to non-compliance by the Corporation.

The DA has submitted questions to the Premier’s office asking for detailed reasons for the continued poor financial performance in the NHWC and the steps being taken to reverse this negative trend. The Premier must authorize a forensic audit to ensure that financial sanity is restored in the NHWC.

The A-G’s report points out that the substantial financial loss was due to gross mismanagement, non-record keeping, the absence of any internal audit measures and a clear lack of skills to resuscitate the entity.

Of particular concern, was the finding made by the A-G that there were no supporting documents handed in with the financial statements as a result of a lost laptop. The corporation alleged that they could not salvage the situation as they did not have any back-up documentation.

For an organisation that has a multi-million rand budget, it is very concerning that they are unable to adhere to basic corporate governance measures, especially now that the entity falls within the liquidation risk catergory.

The North West Provincial Government has failed to act against current, and former, officials and board members despite exposure of serious misconduct and irregularities.

The NWHC was established in the former Bophuthatswana and has been taken over by the North West Provincial Government. The corporation is acting under the wing of the North West Development Corporation which reports directly to Premier Supra Mahumapelo.

The leadership challenges and corruption issues are coming on for more than a decade now.

It is now time to intervene and turn this into a sustainable asset. The Premier is also accountable for neglecting to keep the NWHC afloat and he needs to act upon those who are non-compliant and corrupt to work towards providing much-needed housing to the poor.

Issued by Joe McGluwa, DA North West Leader, 19 July 2017