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Monday 22 July 2019
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Windhoek’s cash conundrum

A budget crunch at the City of Windhoek, the country’s largest local authority, has reached a “critical stage” after details emerged that the Council is not commercially viable.
The municipality has now earmarked the sale of land as one of its key revenue drives, a move that could see the cost of land being unexplainably high for ordinary city residents.
The City of Windhoek (CoW) finds itself in a cache-22 situation after it emerged that the municipality is not commercially viable and it is sitting without an immediate plan to address its current financial puzzle, the National Council’s committee on Public Accounts and Economy (PAC) has said.
The analysis by the committee is informed by audit reports of the City of Windhoek (Windhoek Municipality) for 2012, 2013, 2014 and 2015 that were compiled by Auditor General, Junias Kandjeke.
In the successive audit reports, CoW got a disclaimer audit opinion from Kandjeke.
According to the committee, it is clear that the CoW is not commercially viable and there are growing concerns of material uncertainty of the City’s ability to continue operating.
“From 2012 to 2016, if the acting CEO can bear with me, the City of Windhoek is not commercially viable. And if there are no remedies, the City will become factually insolvent,” said John Likando, a member of the PAC committee.
Likando further lamented that the reality that CoW was currently in a bad financial state has placed the entire country in an awkward position.
“Currently, the CoW is not economically viable and it also puts a loss of trust from your residents and visitors,” Likando added.
He added the situation is further made worrisome by the fact that the City’s management seem not to be in possession of an immediate plan to address the cash crunch at Namibia’s biggest municipality.
“How can you assure us that you will move from this position of not being commercially viable? Because the next stage is insolvency. The accumulation of losses is very worrisome for the committee,” further queried Likando who was clearly not impressed with CoW financial position.
Chief among other concerns for the committee is fraud, irregular tender awarding process; irregular sale of property and cases that are reported to the Anti-Corruption Commission that drag on for years. “Is there anything coming out from this special investigations? Because from 2012, we are receiving elements[reports] of mismanagement, fraud (and) irregular sale of properties. What really is the City of Windhoek doing?” he asked.
Apart its teetering financial state, the Windhoek has also lost its position as the cleanest city, something Likando isn’t happy about.
He said: “We are concerned that the city of Windhoek lost the status of the cleanest town in Africa. From number No. 1, currently it’s at No. 10. These are some the things we have to work on in the reports.”
Sharing similar sentiments as Likando was chairperson of the PAC committee and Aminius Constituency councillor, Peter Kazongominja who said Windhoek “should lead by example”.
“Windhoek is the light of Namibia. When one hears that they are going to Windhoek, they know that they are going to the best place in Namibia. But if we are having the current status where Windhoek finds itself, where it cannot sustain itself, it is very worrisome for the committee and the nation,” Kazongominja said.
He added: “The committee is not here to crucify you. We are here to make sure that Windhoek becomes that city that we all want it to be. And that can only be (achieved) when we have a unqualified audit opinion.”
These remarks were made during a recent hearing session between the PAC committee and CoW’s management.
Responding to the committee, Fillemon Hambuda, CoW’s strategic executive for economic development and community services said the City was “equally worried with ourselves”.
According to Hambuda, the City intends to follow up and fast-track its sale of land as one of the immediate solutions to its financial crisis.
Hambuda further attributed the City’s dire financial state to the water crisis that hit Windhoek in the past year.
Hambuda said “during the water crisis, we had to divert money that was budgeted for other projects (to cater for the water deficit). We recently added Groot Aub. Some of the expenses are not budgeted for, but are necessary”.
He added that “we cannot control the influx of people to the City” before adding that “we want to recover at least 85% of N$600 million” that is owed to the City.
Hambuda further gave emphasis on the fact that the municipality is not run on a profit-making basis.
But he acknowledged that the little profit they make is “re-invested” in the City and its people.




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