Public enterprises ministry to become holding company

THE government has moved to dissolve the Ministry of Public Enterprises with the intention of eventually transforming it into a holding company.

This process would take about five years.

In the meantime, the ministry will exist as a department under the Ministry of Finance.

Minister of public enterprises Leon Jooste yesterday said his ministry must be phased out as per the recommendation of the high-level panel on the Namibian economy.

He said once all functions are consolidated under the finance ministry, the functions of the government would be enhanced.

“They would then have to direct oversight into the financial and operational performance of public enterprises, and subsidies could then be more accurately aligned to compliance and performance,” he said.

Jooste said this would further allow the finance ministry to take control of and be directly involved in the establishment of the holding company.

“This is a decision based on technical facts and strategic rationale where the consolidation and streamlining of operational processes would inevitably result in substantial cost savings, since a separate ministry would no longer have to be maintained,” the minister said.

Jooste said this decision is in the best interest of the country and the government, and no momentum would be lost in the collective quest to transform Namibias public enterprises.

Political analyst Ndumba Kamwanyah yesterday said it is the right move to avoid unnecessary wastage and duplications in the public system.

“With all intents and purposes, the scope and the mandate of the public enterprises ministry do not warrant a stand-alone ministry, but rather a department to supplement the host ministries of respective state-owned enterprises,” he said.

According to local economist Omu Kakujaha-Matundu, the ministry has not been successful at performing its mandate.

He yesterday said it is better to dissolve it, because it has led to more confusion than solutions.

He said the ministry was created without proper focus on what was to be achieved.

Graham Hopwood, the executive director of the Institute for Public Policy Research, said it is good to see the government sticking to a plan, as it was expected that the ministry would be phased out.

“I think theyve made a lot of progress in the six years theyve existed in improving governance at board and executive level in some public enterprises.

“But theres still a lot more work to do, and the need to make some hard decisions about public enterprises that are basically defunct, like the Roads Contractor Company,” he said.

Hopqood said he hoped the finance ministry was up to the task as many public enterprises are still making huge losses, with some mired in corruption scandals.

“Its also good that we will have one less ministry, and therefore some money will be saved,” he said.