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Friday 18 January 2019
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The rot in parastatals

Namibia is currently on a growth trajectory – albeit slower than it should be – and this is solely because of the rot in our state-owned enterprises that are supposed to propel the nation to greatness. I mean seriously, what comes to mind first when you think of a parastatal, infightings, pathetic corporate governance, corruption and nepotism. You think of TransNamib and Air Namibia (bailouts), National Housing Enterprise (poor housing delivery) Roads Contractor Company (financial mess), Telecom (poor governance). We could go on and on.  Parastatals have become so synonymous with bad headlines that not a week passes by without one or two of them making headlines for the wrong reasons. So dire is the situation that President Hage Geingob decided to establish a dedicated ministry to deal with those stepping out of line.

It will take a lot of convincing for Minister Leon Jooste to convince me that parastatals in this country are not giving him sleepless nights. After all, parastatals are supposed to be the agents of government, by delivering quality and affordable services to the nation, but at the moment they are doing the opposite. Namibians have very little appreciation towards their parastatals, not that anyone can blame them. Imagine having to read every week how institutions you are funding, as a taxpayer, are squandering money and operating self-enriching schemes, and then we wonder why Namibians have resorted to being a nation filled with people who constantly complain.

If it is not board fights, it is CEOs looting company funds in S&T, or officials employing their relatives. To make matters worse, these corporate governance atrocities are being committed by well-education officials holding big qualifications that amount to nothing in reality – at least based on the way they manage the institutions they head. It is rare to hear of an appointment at a parastatal that is not disputed, be it due to political or board interference. Currently, there is a brawl taking place at the housing enterprise whereby the board is allegedly trying to get rid of two senior managers who are accused of not doing their work. This is taking place at a time when thousands of Namibians yearn for a house they can call their own instead of being subjected to renting year in and year out. Apartments have been mushrooming in the city faster than the rate at which houses are being built. It is sad to see that private developers can build more houses than the public entity entrusted to deliver houses to Namibians.

This week, the Namibia Airports Company made headlines for awarding a tender worth over N$150 million through the backdoor. Makes one wonder, when did things degenerate so much or has it always been like this? Talking of money, who can forget the handsome severance packages dished out to incompetent CEOs.  Some parastatals even payout severance packages despite having enough grounds to fire someone. Namibia is a country that does not hold a culture of firing, I must say the absence of that culture is costing taxpayers millions. One cannot deny the fact that the ongoing ruckus within parastatals mirrors the level of corporate governance in this country and to a larger extent the level of governance in the country. After all, parastatals are offspring of Government, and the apple does not fall far from the tree as per the words of the wise man.

In a country where political affiliation dictates who gets what position, it has become a distant dream yearning for good corporate governance. Political interference in boardrooms is seen as one of the major contributing factors to parastatals’ continued to lagging behind when compared to their competitors in the private sector. Corruption in parastatals cannot be denied, and it continues to flourish despite the existence of an Anti-Corruption Commission. So many media reports exposing shady dealings within parastatals but the conviction rate is appalling.

Or are we saying the media reports are inaccurate, hence the low conviction rate? You have a situation whereby board members are allowed to serve on multiple boards, while at the same time holding full-time jobs, can we really expect such people to deliver? The race to serve on multiple boards has become lucrative in Namibia, so much that some officials can earn board fees exceeding their monthly salaries. Corporate governance cannot be compromised in a developing state like Namibia, and without improving the output of our parastatals, the overall growth of the country will continue to move at snail’s pace.




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