RAINBOW Party secretary Wynter Kabimba says if the National Pension Scheme Authority (NAPSA) is buying Chrismar Hotel in good faith, it must inform the public what they intend to do with it and demonstrate how pensioners will benefit.
NAPSA is winding up a purchase transaction of Chrismar Hotel, a Lusaka based business that is owned by President Edgar Lungu’s close friend Valden Findlay.
In August this year, News Diggers published a story revealing that NAPSA was facing political pressure to buy the Hotel, but the Pension Authority vehemently denied having made a decision to buy the property and rubbished the story as fake news.
But according to correspondence seen by News Diggers, NAPSA wrote to Chrismar Hotel seeking to renegotiate the deal after the board approved the decision to buy the hotel.
But commenting on this in an interview, Kabimba said NAPSA had gone into commercial developments which did not benefit the pension subscribers.
“The history of social security schemes, NAPSA, when it was National Provident Fund, the Local Authorities Superannuation Fund (LASF) which is the social security scheme for all local authorities and ZESCO, the Mukuba Pension Scheme which is a social security scheme for all mine workers. These three historically did social schemes, [they] used to get into estate development. So when you look at compounds like Libala, Chilenje, Kamwala, New Kabwata, Kabwata and other townships on the Copperbelt, they were actually constructed or developed out of money lent by these social security schemes to local authorities or to ZCCM. The advantage of that was the pensioners that contributed pension to these schemes eventually became beneficiaries in these townships which were developed. They put up houses and the rentals were somewhere like K7 for example so nearly everybody would afford to live in a house in Chamboli. So the theory was that the beneficiaries of these developments were actually the pension subscribers themselves,” Kabimba said.
“The problem that has arisen now which I have seen is that pension schemes like NAPSA have gone into commercial developments, developments which do not benefit the pension subscribers. Their argument is that we have put up Godfrey House so that the rentals from here we can use them towards paying pension subscribers and yet what you find is that the rentals are so high, unaffordable, and they run a balance sheet which is in deficit. When they come to sell properties which they develop, the pension subscriber does not become a beneficiary. So reading the story, the question you raised which is fundamental and which NAPSA must answer is what do you intend to use this piece of land for? NAPSA must answer that question so that the public can appreciate whether or not the intended is going to benefit the pension subscribers. That information must become public. If NAPSA is doing things in good faith as a public institution accountable to the Zambian people, that should not be a difficult question for them to answer.”
He lamented that NAPSA was embarking on projects which were too expensive for their beneficiaries.
“For example, if NAPSA intends to get that piece of land to put up a five star hotel which is unaffordable to the ordinary person, then they would have walked away from their corporate social responsibility which is founded on the principle that the beneficiaries of this development must be the pension subscribers. That trend started with MMD, they were tolling the capitalist line of economic development. PF has continued to toll the capitalist direction of development. They have walked away from their manifesto. I remember one day to my shock and horror Mr [Michael] Sata saying in a Cabinet meeting ‘we are not a socialist party, we are a capitalist party’ and yet the preamble of the PF constitution is talking about a socialist development,” said Kabimba.
“So this trend has continued from 1991. Look at the houses that are being constructed by NAPSA, you would expect them to build houses that are affordable to the middle class. The young men and women who work in the bank for example, the directors in government but you have seen most of them going into disrepair because people can’t afford. This category of people that are supposed to benefit from this category of people cannot afford these houses and this has led to corruption. You look around for the roots of corruption, it is actually rooted in the capitalist mode of development. Which is making it difficult for people to survive.”
In a letter addressed to Haberton Limited managing director, NAPSA Director General Yollard Kachinda stated that the Authority was inviting the hotel for re-negotiations on the offer price for land and buildings only.
“Dear Sir, Re: Negotiation for the purchase of plot number 6982 in Lusaka. Further to the negotiation meeting of 12th June, 2020, over the purchase of plot number 6982 in Lusaka (refer to copy of minutes herewith attached for the ease of reference), we write to advise that the offer of current hotel business aspect of the transactions by yourselves and the consideration thereof by the NAPSA negotiating team was outside your initial offer and subsequent approval by the NAPSA board of trustees,” read the letter.
“Kindly note that the NAPSA board of trustees approval was for the purchase of land and buildings only and was based on your offer, hence did not include the current hotel business, which would have required specialised due diligence if it was part of your initial offer. In this regard, and in order to comply with the NAPSA board of trustees’ approval, we hereby invite you for re-negotiating on your offer price for land and buildings only.”
According to sources, NAPSA failed to resist political pressure to buy the hotel.
“This never went away, at the time when you were writing the story that there was a intention to buy the hotel, the negotiations had reached an advanced stage. Right now, the purchase is almost done and all the negotiations were concluded. So we have a situation were NAPSA will be spending millions of dollars worth of people’s pension contributions used on a business that does not make sense at all,” said the sources.
NAPSA has previously confirmed to News Diggers! that it received an offer for the sale of the property, which is located at plot number 6892 Los Angeles Boulevard in Lusaka, but said the decision to go ahead with the investment was not made.
Impeccable sources revealed that Findlay, who is President Edgar Lungu’s close associate and business partner, was in the process of liquidating some of his assets, including Chrismar Hotel but at inflated valuations.
“What we know is that three valuations were done on Chrismar Hotel, claiming that the property is worth US $10 million, US $11 million and US $18 million, respectively. So, the general feeling is that it has been too overpriced, but there is pressure for NAPSA to buy the hotel. There seems to be too much pressure coming from government, even when the value that has been attached just doesn’t make sense,” sources said.