President Hage Geingob has endorsed the recommendation of the High Level Panel on the Namibian Economy (HLPNE) to dissolve the Ministry of State Owned Enterprises (SOEs).
The ministry will now be transformed into a department under the Ministry of Finance. Minister Johan Jooste this afternoon told the Windhoek Observer that no job losses are expected, adding that the transformation will happen in the next three months. He says ‘only time will tell’ regarding his own future political career. Press Secretary Alfredo Hengari refers questions in this regard to Jooste.
“Experience has shown that most of the issues encountered at Public Enterprises that warrants the intervention of the shareholder, inevitably have a financial implication. These matters consequently require the consistent attention of the Minister of Finance, and many times end up on the agenda of the Cabinet Committee on Treasury. It is therefore obvious that it is in the interest of the Minister of Finance to always be acutely aware of the status of the Public Enterprises,” Jooste explains.
He says the decision is based on technical facts and strategic rationale where the consolidation and streamlining of operational processes will inevitably result in substantial cost savings since a separate ministry will no longer have to be maintained.
“I am entirely convinced that this decision is in the best interest of the nation and the government and that no momentum will be lost in our collective quest to transform the Namibian Public Enterprises,” he says.
Political Analyst Ndumba Kamwanyah says government is moving in the right direction, adding that the dissolution would reduce duplication of work between the two ministries.
“A department would definitely serve the responsibilities well. It will also save cost. We do not anticipate job losses, but obviously the management structure will be affected. Staff members will be redeployed. It is a good move and we welcome it. Senior staff might be reassigned. In this sense, it might not be a lot of saving but when you look at the privileges accorded to the ministerial level position, it will push the cost downward. This decision goes to show that government is serious about working efficiently and reducing the duplication of duties, “Kamwanyah says.
He adds although the liquidation of SOEs such as Air Namibia, Small and Medium Enterprises Bank(SME) and the public outburst thereof might have been a factor, it may not have had much weight.
“To some extent it might have been one of the factors, in the sense that people were starting to question the relevance of the ministry and the boards. The issue of performance was also being looked at,” Kamwanyah adds.
Graham Hopwood, Executive Director of the Institute for Public Policy Research (IPPR) says move was expected, that plans to phase out the ministry have long been discussed and it was just a matter of time.
“In 2015 they said they would be phasing out the ministry at some point and it was repeated again in 2020. The ministry has a series of time limited tasks and the minister indicated that most of those have been completed. This move obviously leads to cost reduction in terms of salaries and all associated costs. It is a good move, as long as the Finance ministry has the capacity to exercise authority over the public enterprise department,” he says.