NHC seeks Bunge help in bourse listing bid

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Published on Friday, 19 October 2012 04:47

Written by ALVAR MWAKYUSA

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THE National Housing Corporation (NHC) has appealed to the Parliamentary Public Organisations Committee (POAC) to support its bid to transform from a public corporation to a public company, so it raises capital through the Dar es Salaam Stock Exchange (DSE).

If the proposal goes through, the company will float 25 per cent of its shares at the bourse that will allow it to raise funds for construction of decent and affordable houses.

The listing of NHC is also envisaged in a bid to make running of the corporation more transparent and profitable. Limited capital is among challenges facing the housing corporation and when it needs to borrow funds for its projects it has to seek the approval of the Treasury Registrar, a process which takes long to materialise.

The transformation process requires amendment of legislation for establishment of NHC as a public corporation by incorporating it as a public company through the Company Act. Appearing before the parliamentary committee in Dar es Salaam, the NHC Director General, Mr Nehemiah Mchechu, blamed bureaucracy for delaying the transformation.

“We really need your support honourable MPs to enable us achieve this goal,” Mr Mchechu said. At present, the NHC is owned by the government. In response, the Chairman of POAC, Mr Zitto Kabwe (Kigoma North-CHADEMA), said the committee would support the idea since it will make the company more effective.

“NHC has been making profits over the years and this will enable it list at DSE without hurdles. It is high time it was listed at the bourse and we will support it,” Mr Zitto declared. He added: “MPs have been urging the NHC to construct affordable houses in urban and rural areas and this will not be possible if it doesn’t have enough funds.

It should also be noted that unlike most of other public organizations, NHC does not receive subsidies from the government.” He also spoke on the need to shelve Value Added Tax (VAT) on houses built by the housing corporation to make them affordable to the majority of Tanzanians.

Mr Mchechu had earlier indicated a total of 910 housing units were currently being built in various parts of the country, as the corporation strives to seal the ever increasing shortage of housing units for majority of Tanzanians. On the other hand, the POAC expressed concerns on procurement procedures at the NHC in which about 25bn/- was spent out of the annual procurement plan of the corporation.

Mr Zitto had observed that during financial year 2010/2011, the NHC procured goods and services amounting to 31bn/-, out of which 25bn/- was out of the annual procurement plan. The POAC Chair thus directed the management of NHC to ensure that it adheres to its annual procurement plan as required by the Public Procurement Regulatory Authority (PPRA).

Mr Mchechu admitted that 25bn/- was spent out of the procurement plan for construction of the World Bank headquarters as well as other projects in the city.

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