The Ministry of Finance and Public Enterprises has started regional consultations on the touted Public Enterprises Ownership Policy, through which the government seeks to create an entity to control all state-owned enterprises (SOEs) while letting go of some.
The consultations are being undertaken in partnership with the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ).
The first session kicked off in the Khomas region on Monday.
The policy gives insight into the reasons, timing and methods the Namibian government will use to secure ownership of public enterprises.
“This policy delineates the fundamental principles that govern the State’s ownership of these enterprises, specifying the roles and obligations of board members and management. It also incorporates measures aimed at ensuring robust financial management, taking into account social and environmental aspects, and implementing safeguards against corruption and other irregularities,” the ministry said.
The policy is the brainchild of former minister of public enterprises Leon Jooste, which uses the Singapore and Malaysia model.
According to the model, a central holding company becomes the owner of all commercial public enterprises and reports to the minister of finance, in line with the provisions of the State Finance Act.
“This is a decision 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,” Jooste said, motivating his proposal.
The Cabinet blessed the idea already.
Meanwhile, Finance Minister Iipumbu Shiimi previously stressed that there was neglect of the government’s assets, citing rail operator TransNamib as an example.
“There has been neglect in the past and also limited investments to rail maintenance when we are comparing it with road infrastructure that has been ongoing almost every year,” he said.
Shiimi said Namibia operates as a capital-intensive economy.
“We cannot rely on old engines of growth even though the country is commodity-driven. We know extractive industries do not create enough employment, even though they produce enough revenue and foreign exchange,” he said.
Worsening a bad situation
Meanwhile, Shiimi’s deputy, Maureen Hinda-Mbuende, says leaving SOEs in the hands of board members, who are already failing in their current state, will exacerbate corruption and poor performance.
“I have a strong feeling a Public Enterprise Holding will fail becuse if current SOEs in their current form are not performing, what will happen when you entrust many companies to a body of maybe five people? It makes no difference. It will just be another way of benefiting individuals,” she said.
Hinda-Mbuende proposed the strengthening of governance structures in public enterprises.
“Once it becomes a holding, this is like leaving the public entity in the hands of the private sector, which will only be driven to amass profits without consideration of the populace,” she said.
The Ministry of Finance and Public Enterprises has started regional consultations on the touted Public Enterprises Ownership Policy, through which the government seeks to create an entity to control all state-owned enterprises (SOEs) while letting go of some.
The consultations are being undertaken in partnership with the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ).
The first session kicked off in the Khomas region on Monday.
The policy gives insight into the reasons, timing and methods the Namibian government will use to secure ownership of public enterprises.
“This policy delineates the fundamental principles that govern the State’s ownership of these enterprises, specifying the roles and obligations of board members and management. It also incorporates measures aimed at ensuring robust financial management, taking into account social and environmental aspects, and implementing safeguards against corruption and other irregularities,” the ministry said.
The policy is the brainchild of former minister of public enterprises Leon Jooste, which uses the Singapore and Malaysia model.
According to the model, a central holding company becomes the owner of all commercial public enterprises and reports to the minister of finance, in line with the provisions of the State Finance Act.
“This is a decision 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,” Jooste said, motivating his proposal.
The Cabinet blessed the idea already.
Meanwhile, Finance Minister Iipumbu Shiimi previously stressed that there was neglect of the government’s assets, citing rail operator TransNamib as an example.
“There has been neglect in the past and also limited investments to rail maintenance when we are comparing it with road infrastructure that has been ongoing almost every year,” he said.
Shiimi said Namibia operates as a capital-intensive economy.
“We cannot rely on old engines of growth even though the country is commodity-driven. We know extractive industries do not create enough employment, even though they produce enough revenue and foreign exchange,” he said.
Worsening a bad situation
Meanwhile, Shiimi’s deputy, Maureen Hinda-Mbuende, says leaving SOEs in the hands of board members, who are already failing in their current state, will exacerbate corruption and poor performance.
“I have a strong feeling a Public Enterprise Holding will fail becuse if current SOEs in their current form are not performing, what will happen when you entrust many companies to a body of maybe five people? It makes no difference. It will just be another way of benefiting individuals,” she said.
Hinda-Mbuende proposed the strengthening of governance structures in public enterprises.
“Once it becomes a holding, this is like leaving the public entity in the hands of the private sector, which will only be driven to amass profits without consideration of the populace,” she said.