THERE arguably is no blueprint for enhancing public sector efficiency but certainly, Government’s initiative to freeze public service recruitment for 2016/17 connects well with our reality right now that global growth still remains muted, financial markets have become volatile and currencies of emerging markets have become weak as they fluctuate widely.
In the wake of the expected budget deficits and extended developmental programmes, Namibia under the Harambee Prosperity Plan has begun to confront the difficult task of making the public sector more productive. The need to reform public pay and employment policies has come to be seen as an important element in meeting this challenge.
Essentially, Government as reported in our edition last week has frozen the filling of any civil service vacancies this year in a bid to raise at least N$750 million needed in drought relief aid to urgently feed nearly 600 000 people- approximately a quarter of the country’s population.
As part of stringent fiscal consolidation measure, Government through the Ministry of Finance now requires ministries to formulate monthly budgets where they outline what they intend to use the requested money for before treasury approves and subsequently releases the funds to the ministries.
Critically, attention to public pay and employment stems in as part of the pressure placed by fiscal constraints on the wage bill, which in Namibia constitutes a major share of public expenditures. Concern has also been prompted by the growing recognition that conditions of pay and employment may be key inhibitors of Government performance. Indeed, overstaffed bureaucracies afflicted by eroding salary scales, pervasive demoralisation, corruption, moonlighting, and chronic absenteeism are often unable to carry out the essential economic policy and management tasks that are a key part of emergency economic recovery programmes.
It goes without saying that a huge wage bill is a threat to sustainable Government expenditure. With it, it will be difficult to realise the fiscal responsibility principle related to the percentage of development to recurrent expenditure. Further, our rising wage bill compromises the economic health of Namibia by increases inflationary and financial risks and hence limits chances for the economy to generate jobs for the ever increasing number of unemployed youth.
Notably, the national wage bill growth driven by both number of employees and average wages has had its average almost double from 2010 to 2016 with wage increases well ahead of inflation. On the other hand personnel expenditure has seen sizable increases since 2012/13. There were huge increases in 2013/14 and 2014/15 as part of effort to align civil service wages to private sector to with upward revision in 2016/17, from N$24.2 billion to N$25.1 billion.
Whilst Government efforts remain laudable as they promote the poverty alleviation mantra, more needs to be done to achieve effective saving for this cause. Suggestively, a moratorium on all new Government offices with budget to improve use of space, renovations and maintenance, a full audit of current government assets, scrapping current non-productive development budget project, conducting proper appraisals of all future projects and reroute funds to key infrastructure projects may all go a long way in helping Government achieve its developmental plans.
Confidente. Lifting the Lid. Copyright © 2015