VNHC at crossroad with VT 100 million debts

THE Vanuatu National Housing Corporation (VNHC) is believed to be facing a financial collapse with debts of VT 100 million

The huge debt was revealed at a high level meeting held this week between the Minister of Internal Affairs, Georges Wells, and the VNHC's management and Board of Directors.

The private political advisor to the Ministry of Internal Affairs, Jonas Cullwick, confirmed that Minister George Wells, who has responsibility over the national body, requested the meeting to get a briefing on the operations of the VNHC after six months of being in-charge of the Ministry.

The Minister had requested the Board and Management supply an update on the financial status, clients’ payment position, recoveries, court cases with clients, and for an audit of the books of the Corporation to be completed next year.

He said that in highlighting the dire financial position of the Corporation, the Company's Chairman Stephen Natuka pointed out that some clients at its Freswota subdivisions have not paid any money to the Corporation over the last ten years.

Mr Natuka pointed out that if all the clients were faithful in their payments the NHC would not be facing any financial difficulty.

“The situation of the NHC is that it needs the compensation money from the Government for the Freswota School and the Frehwota Field, totaling around VT89 million.

“The Minister for Education and the Minister for Education have both agreed to the payment, but a deed of settlement is still to be raised, and I hope the payment can be forthcoming soon so that this can assist the NHC,” said Mr Natuka.

However the VNHC's CEO John Terry confirmed that the financial status of the National Housing Corporation was “very serious”.

He gave a brief outline of the financial status of the Corporation, stating that the NHC has an outstanding from clients at Freswota of over VT100million.

“Our recovery effort is progressing, with all clients now classified under Red for Clients who are not paying at all, Green for those whose payments are irregular, and Yellow for Good clients who keep up with their payments,” said Mr Terry.

He added that lawyers now are being engaged to assist them with the clients in the Red and Green category.

The CEO also placed their hope in the compensation from Government for the Freswota School and Field. Once this money is in Mr. Terry said it will be used for creditors and other outstanding payments. This  creditor list includes more than VT1.5million for staff contributions to the Provident Fund, land rent of more than VT6million, outstanding VAT payment of more than VT13million, CDF Surveyor VT2million and compensation for a late staff member of VT3million.

Mr. Terry said since last December, 11 cases of non payment have been to the courts and two of the properties valued at VT12million were sold off.

On the subject of audit, the CEO reported to the Minister that the last audit of the NHC’s finances was done in 1997 and since then, no audit had been carried out.

He said their papers for the years 1998 to 2008 were ready for auditing. But he pointed out that they were unsure why the Auditor General was delaying completing the task.

He added that they were considering engaging private auditors if the delay continued, now that records for 2009 and 2010 were almost ready for auditing as well.

At the end of the meeting, Minister Wells called on the Board and the CEO to work closely with his First Political Advisor, Daniel Bule and Private Political Advisor Jonas Cullwick, to plan the Corporation’s work priorities for 2012. He stressed that the NHC can be a very profitable organisation if run and managed successfully. 

The National Housing Corporation has 46 houses in Freswota and more than one thousand plots of land. It has nine staff members and seven Board members.

The VNHC 's delegation comprises of the Chairman, Stepehn Natuka, the Chief Executive Officer of the Corporation, John Terry and Secretary and Finance Officer, Davina Tosusu.