Parastatal bailouts, tax write-offs dominate budget workshop

Tax write-offs, bailouts and the need to find punitive measures to deal with poorly run state-ownedenterprises (SOEs) were once again at the fore this week in a budget analysis and advocacy workshopbetween lawmakers and industry experts.The workshop was organised in partnership with Standard Bank Namibia.

Speaking at the workshop yesterday, economist Salomo Hei said it is unavoidable that the government
will have to decide how to deal with parastatals that fail to comply with their tax obligations.

He said while the Namibia Revenue Agency, owned by the state, needs to execute its mandate without
fear or favour, the government, as a majority shareholder in parastatals, is under pressure to find
solutions to non complying SOEs.

Hei said the government should make decisions that are in the best interest of the state and the jobs of
those employed.

“When it comes to bailouts and the issue of these parastatals that do not comply with their tax
obligations, the reality is that a decision has to ultimately be made. However, when making decisions, the
government needs to do it in a manner that makes sure that the same problems of non compliance with
tax and poor performances in the parastatals will not be repeated,” Hei said.

Hei was responding to questions raised by Swapo backbencher and member of the parliamentary
standing committee on public accounts, Natangwe Ithete and United Democratic Front member and
parliamentarian Dudu Murorua on how best parliamentarians can play a part in improving the
accountability of public enterprises.

Hei also touched on the challenges faced by the railway operator, TransNamib, which he said needs
capacitation, capitalisation and efficiency management.

Hei said while parastatals are assisted by taxpayers’ money to better their financial fortunes and improve
performance, the long term goal is to refine and scrutinise their business plans to speak to better
performances and the elimination of possible flaws in the future in a manner beneficial to both the
shareholder and the SOEs.

He said parliamentarians are empowered by the laws of the country to push for accountability in the
public sector to safeguard value for money in the manner in which parastatals are run.

CLEAR POLICY

Hei reiterated the need for Namibia to have clear and well marketed investment policies to the
satisfaction of potential investors. He said there is a need for the government to drive home the presence
or absence of policies, including the New Equitable Economic Empowerment Framework (Neeef).

He said such policy issues play a significant role in influencing both investor appetite and decision
making.

“In terms of policy, we did not say Namibia is not being marketed but we said it is not being promoted
enough. We said there is an investment facilitation and promotion bill that is not being marketed enough.
Investors want to know whether there is Neeef or there is none.

“Our late president also spoke of the decision not to export raw materials.

What does it mean and what do you mean by raw? So, there is a need for a clear policy imperative to
address that,” he added.

According to Hei, it is important for bills that have potential effects on investment into the country to be
dealt with in ample time in parliament.

He encouraged lawmakers to play their part in working on bills that have significant implications on
investments.

Responding to Murorua’s question on why Namibia has no influence on how commodity prices are
decided in the world, Hei said decisions on commodity prices on the global scale are affected by global
market trends and Namibia has to produce better qualities to sustain jobs and the operations of the
companies that mine the commodities, as well as the jobs at the various mines.

– tiri@namibian.com.na