Nored acts against employees after N$73m loss

Northern electricity distribution company Nored has opened police cases against employees alleged to have corruptly underbilled electricity clients, leading to losses of N$73 million from this practice alone.

Some Nored employees are accused of illegally connecting clients to Nored’s power supplies, presumably in exchange for cash bribes.

For months, Namibian Sun has been reporting on Nored's financial woes, as the company has been failing to meet its financial obligations.

With the company’s CEO, Fillemon Nakashole, and several senior executives serving an indefinite suspension due to allegations of corruption and maladministration, Nored is struggling to make ends meet.

Nored is responsible for supplying electricity to the eight northern regions.

The company’s books are reportedly in shambles, with the company recently revealing, after an audit, that it has made losses of over N$90 million due to underbilling, meter bypasses and illegal electricity connections.

The alleged culprits are Nored employees who are now being investigated by the Namibian police.

Nored spokesperson Simon Lukas yesterday confirmed that police cases have been opened.

“Yes. Nored has opened several police cases against the culprits,” Lukas said.

In-house dilemma

Last week, Nored’s acting CEO, Toivo Shovaleka, in an internal memorandum dated 31 October, indicated that the company has established that some of its staff members are deliberately responsible for the financial losses the company faces.

“Regrettably, and with utter disappointment, I convey to you that we have now firmly established that some staff members – full time and contractual – individually and in [cahoots] with external ‘contractors’ and customers are purposefully on a mission to cause financial losses to Nored through massive meter bypasses and illegal connections,” he noted.

“This is a test to the resolve of the company and we shall act accordingly.”

Massive losses

Last week Nored launched its turnaround business strategy, focused on stabilising its finances.

This comes days after the company management attended the Electricity Supply Industry (ESI) forum meeting at Otjiwarongo on 24 October.

At the forum, Nored revealed its staggering losses as depicted in the audits conducted on the company's finances.

In an audit of large power users, Nored discovered that 93 of the 605 meters were underreporting electricity usage, an oversight that has led to losses in the region of around N$73 million in a period of three years.

Of this, only about N$61 million can still be recovered and Nored has indicated that it has commenced the recovery process. Furthermore, through the token identifier (TID) process, Nored discovered close to 379 meter bypasses, with fines amounting to over N$13 million, of which only N$3 million has been paid so far.

Deep trouble

Earlier this year, Namibian Sun reported that alleged insider trading, bribery, uncontrolled spending, leaking of confidential information, abuse of company vehicles and the use of counterfeit vehicle parts were draining the finances of the country’s biggest regional electricity distributor.

This information was based on documents seen by Namibian Sun, which revealed the extent of Nored’s troubles – a situation that has prompted the company’s top leadership to enforce a range of organisational changes.

The documents also revealed the mind-boggling scope of financial constraints at the electricity distributor.

In January this year, Nored’s executives had to scramble to raise N$8.9 million within three days in order to pay an outstanding balance on its NamPower account.

- [email protected]