When we see the continuing swirl of controversy, crises, financial calamity and inefficiencies around SOEs (or Public Enterprises) in Namibia, we remain baffled by the unexplained delays in passage of amendments to the Public Enterprises Act which has left Leon Jooste’s ministry high and dry.
Founded on 21 March, 2015, the Ministry of Public Enterprises (MPE)remains without crucial amendments to the SOE Act, which will completely change the way SOEs operate in Namibia.
Right now, Jooste and his staff are just sitting in their make-shift offices on Independence Avenue, spinning their wheels in the mud as they work hard to move forward. And that is a shame.
The MPE was created to address a key pillar in the reforms proposed by the Geingob administration. MPE was supposed to be a ‘game changer’, but the slow progress towards the passing of its empowering legislation may tell a story of a lack of commitment at all levels to the ministry’s mandate.
The entire point of spending hundreds of millions to create a new ministerial portfolio, hire staff, rent offices, cars, and do the hard ‘work’ of organising and reigning in the errant and sometimes be-draggled SOEs, was to turn things around, stop the bailouts and inconsistent SOE board/management salary gluts, and get financial contributions from SOEs into the economy, rather than the other way around.
In June 2016, Jooste introduced his Hybrid Governance Model for PEs to re-organise the control of the existing 98 SOEs. Among other changes, the Act would force commercial SOEs under MPE’s direct control (answerable to Cabinet).
Regulatory SOEs (like NSA, NTB or CRAN) would be under their line ministries and the very few SOE financial institutions (like RFA, MVA) would reside under the Ministry of Finance. Jooste’s system also offers incentives and performance bonuses for meeting targets with penalties for SOE management and boards that do not make the grade.
However, in a late 2016 interview, Jooste said, “we are anxiously awaiting the finalisation of the legal amendments to our existing legislation that will allow us to implement this governance model.” During that interview over a year ago, Jooste was awaiting Parliament to move this Act into law at the beginning of 2017. Here we sit at the dawn of 2018, and no action has been taken.
We marvelled at the speedy amendments to the Constitution when the number of members of Parliament were increased within months prior to the 2014 elections and the nearly overnight adoption of international money laundering laws (with the threat of global sanctions for non-compliance). It seems Government moves quickly on legislation when it has the political will to do so.
Therefore, we cannot easily accept that passage of the vital amendments to the ineffective 2006 SOE Act is still languishing in Parliament with no passage date in sight. Where is the political will to get SOEs in order and stop the leakage, waste, mismanagement, disorganization, inconsistencies, board cat fights with management, unqualified appointments, etc.?
Inaction on Jooste’s amendments begs the political question of, who is benefitting from the confusion plaguing some of the existing SOEs and whose interests would be threatened by an empowered MPE armed with the legal authority to prosecute, expose and shape-up wayward SOE managers and boards?
What will be revealed when the new amendments force each SOE to publish their audited financial statements, list salaries/remuneration for board and management and adhere to performance agreements?
The MPE has the mandate “To position Namibia’s key Public Enterprises to play their meaningful role in the country’s developmental agenda.” Can they do this without the immediate passage of the legislation, budget to implement Jooste’s plans and political backing needed to go after all ‘interested’ parties who thrive in SOE chaos?
While the country sinks deeper into the economic quagmire and SOE bailouts become impossible, not just impolitic, not a day goes by when SOE shenanigans are not in the media.
Today, we read about members of the NSFAF board (whose term expires in a month) seeking to suspend their CEO and this follows a pattern of clashes between this board and its CEO over the past year. It is precisely the role of an empowered MPE to step in and crack the whip.
Meatco is yet another SOE where the board and MD are at loggerheads. With the Meatco MD suspended and his disciplinary hearing falling apart, one wonders what the suspension was all about in the first place. The beef between the MD and the board chairman has raged for years and yet, the MPE was set up to manage this kind of thing, but is not yet legally empowered to do so.
Air Namibia is making noises about yet another ‘turn-around’ plan and Jooste has already called the vital Windhoek/Frankfurt route into question as a loss-maker. The Namibia Airports Company (NAC) threatened to ban Air Namibia from operating from its airports and to drag the national airline to court over an unpaid N$200 million in airport fees.
The Roads Contractor Company (RCC) is a hot potato with Jooste and the ‘line’ minister of works, Alpheus !Naruseb, at loggerheads over whether or not the bankrupt SOE should remain open.
The recently dismissed TransNamib company secretary has urged the Public Enterprises minister to investigate the board, while the besieged and floundering railway parastatal is inexplicably looking for N$19 billion in re-capitalisation and bailout funds for yet another ‘turn-around’ plan financing strategy.
Jooste himself launched an investigation at how the Social Security Commission overpaid a middleman last year.
The procession of SOE crises such as these continues to march onward, while an instrument to address this tedious parade is held up in legislative purgatory due to the lack of political will to substantively change the way SOEs have been operating in Namibia.
We await what 2018 may bring for the tenacious team at MPE.