Schlettwein freezes awarding of tenders
Government has ordered the Tender Board to freeze the awarding of new tender contracts with immediate effect, until such a time that the 2016/17 financial year budget review and the reprioritisation of capital projects are finalised, as part of cost-cutting measures.
Minister of Finance Calle Schlettwein this week wrote to the Tender Board Chairperson and Finance Ministry’s Permanent Secretary, Ericah Shafuda, instructing her that all new tenders for feasibility studies for capital projects and or surveys envisaged under the operational budget be put on hold.
In the same letter, dated 12 September, the minister said that all accounting officers should ensure that these directives also apply to new capital projects that are funded under the national budget, but fall under the execution mandate of the various public enterprises.
Schlettwein said that the directive is aimed at placing public finances on a sustainable path, as government adjusts to a changing macro-fiscal environment.
This comes as the country received a rating outlook revision by global ratings agency Fitch, after its visit to the country early last month.
Namibia’s economic outlook was revised by the international
ratings agency from stable to negative, as it was worried about the country’s budget deficit that has widened sharply to 8,3 percent of GDP, well above the government’s target of 5 percent.
Critics have warned that the country has been living beyond its means for years, and needs to slow debt issuance, and by extension, reduce spending. Fitch also said that the huge civil service wage bill needed to be reduced.
Last year, Schlettwein said that government was going to cut down on buying cars, while this year he announced that government was looking into pegging wage increases for civil service to the annual rate of inflation.