No bidder yet as NSSF struggles to sell its Dege housing project

 

By Mainda Mhando

Mwandishi wa Habari

Mwananchi

Summary

·         Nearly five months after it was put up for sale, the National Social Security Fund (NSSF) said yesterday that no buyer has emerged for its multi-million dollar housing project in Dar es Salaam.

Dodoma. The National Social Security Fund (NSSF) said yesterday that no bidder has come forward to buy its multi-million dollar housing project in Dar es Salaam, almost five months after it was put up for grabs. Construction of the Dege Eco Village project, which is located at Kigamboni, consumed Sh330 billion of NSSF members’ funds. The project was created by the Fund in 2014 and has hotel buildings, supermarkets, conference halls, an open recreation area, schools, houses of worship, restaurants, hospitals, bars, and posh houses.

Its construction stopped since January 2016. Speaking to reporters yesterday, NSSF Director General Masha Mshomba said the decision to sell the project was reached because it was found that there were some shortcomings in the initial evaluation as the cost required to complete the project was Sh1.5 trillion, which is a cost that is beyond the capacity of the Fund itself.

“If it happens that we have not found someone to give us a price to return the cost, we will once again advertise to sell the project, and that is what we have planned to do in order to attain the goal of compensating the money spent. “And if the plan completely fails, we will return to the decision-makers and give them that information,” said Mr Mshomba.

Insisting on the issue, he said the project will be sold through a system that will enable the return of the costs incurred in order to compensate the costs and at least remain profitable. Speaking about the NSSF’s decision to sell its project, an expert in economic issues, Dr Paul Kapalango said it is normal for large projects to be sold to bidders, but it is a shame for the Fund or the relevant organisation.

“It is not a strange thing for projects to be sold, especially in the interest of such a fund that serves people, but it is a shame and that shows a weakness, especially in evaluating the project before investing billions of money in it.

It is sad,” he said. On the debts owed to the government, Mr Mshomba said the government, through the ministry of Finance, is in the process of satisfying itself with the claims of such debts, which do not exceed Sh500 million, while claiming that by March 2023, the government will say when it will pay those debts.

Read: How billions went down the drain in dubious NSSF project

The Fund has so far paid a Sh2.6 billion debt in the period from June to December 2022 to 183 employees who were dismissed for lack of valid certificates and who made contributions to the Fund before the law on remittances was changed in 2018.

Also, in the financial year ending June 2023, the Fund expects to pay benefits worth Sh769.3 billion, which is an increase of 17 percent compared to the benefits paid of Sh659.8 billion during the same period in the financial year ending 2022.

NSSF’s decision to sell the project was reached after the board of trustees made an assessment and determined that, in the current environment, selling it was more beneficial than continuing with the project’s development because the costs were high.

In October, last year, the NSSF said it intended to dispose of the entire Dege Eco Village Project in its current state and that the prospective buyer would have no further liability after the sale. The tender was conducted through the International Disposal by tender procedures specified in the public procurement regulations, and interested buyers were invited to inspect the property on November 3.

Tenders were to be submitted by November 14, with the potential buyers or tenders accompanying their bid with a tender security of 25 percent (in US dollars) of the bid price. The project was being developed jointly between the NSSF and Azimio Estate Housing Limited.