9 November 2018

Namibia: Budget Cuts Sacrifice Eight Hospitals

THE government sacrificed the construction and renovation of eight hospitals and three health centres across the country when the finance minister presented his mid-term budget.

Tabling the budget review in the National Assembly last month, finance minister Calle Schlettwein announced that he was reducing spending by N$1,8 billion.

The health ministry, whose budget was cut by N$138 million, will not be able to renovate and build new hospitals and health centres.

For the renovation and construction of hospitals, the health ministry's budget was reduced by N$59 million which was diverted to other projects in other ministries.

Health permanent secretary Ben Nangombe told The Namibian this week that there will be a delay in implementing projects at the Nkurenkuru, Okakarara, Keetmanshoop, Okahandja, Opuwo, Oshakati and Okahao hospitals, as well as the proposed Khomas Hospital in Havana in Windhoek..

Nangombe added that because of the budget cuts, the finance ministry also diverted money meant for the Aussenkehr Health Centre, the Rundu Training Centre and the Aranos Health Centre.

He said tenders for the affected projects could not be awarded due to the full usage of budgeted funds.

Despite the cuts in construction projects, the government gave the ministry an additional N$174 million after the mid-term budget review; money which will be mostly used to pay salaries and for the blood testing institution.

Nangombe said the latest budget had allocated N$200 million to the National Institute of Pathology, N$100 million to a special fund, and N$65 million to pay the salaries of graduates.

Meanwhile, the works ministry recorded the highest reduction of N$690 million from the original N$2,2 billion, while the urban development ministry lost N$288 million of its N$842 million budget.

Urban and rural development permanent secretary Nghidinua Daniel said the projects affected are those whose implementation is either slow or had just started (with only 10% expenditure or below), or projects still at the procurement stage.

He stated that the budget cut would affect their operations because there is no money for the development projects they planned to implement this year.

"The ministry, in consultation with regional councils and local authorities, is assessing the impact of the budget revision and an internal realignment of the available funds, looking at particular critical areas," said Daniel.

The ministry of education's development budget was slashed to N$516 million from N$660 million, a reduction of N$144 million.

"The development budget reduction was done in such a way that it will not affect the execution of projects. Before the cuts were effected, an assessment and projections were made to determine how much could be suspended from the affected projects," said the permanent secretary, Sanet Steenkamp.

She said the cuts would not affect the provision of classrooms and minor maintenance work at schools.

"The budget cut was mainly on projects with low execution rates, and those projects for which construction is planned to commence close to the end of the financial year," she noted.

Steenkamp said the ministry's budget review has proactively concentrated on reducing consumption expenditure, mainly on daily subsistence allowances, overtime and other expenditures of an operational nature.

The development budget of the land reform ministry was reduced by N$108 million.

The ministry's spokesperson, Chrispin Matongela, said the budget had been severely affected, with close to 33% of the initial annual appropriation slashed.

"If one objectively analyses the situation, to be frank, I cannot blame the minister of finance. It's because there was not much spending in most budget lines, and looking at where we are (this is already November 2018), very little has been spent," he added.

Matongela said some of the projects affected comprise the land acquisition (48%), which is the ministry's core mandate, and the ongoing resettlement programme (40%).

He added: "I think as a ministry, we did not do more to warrant us to retain the much-needed funds. The internal processes need to be improved because of pressure on the lead procurement management unit".

He further observed that many small to medium enterprises which are listed as suppliers solely depend on tenders to survive.

"Once a company has been selected to perform a certain activity, they either don't deliver on time, or don't deliver at all," said Matongela.

Companies demand payment upfront from ministries to carry out particular functions.

The ministry of industrialisation had a N$48 million reduction in its development budget, while the Ministry of Higher Education, Training and Innovation's budget was cut from N$40 million to N$21 million.

Higher education minister Iita Kandjii-Murangi said it is well-known that the government is currently experiencing a shortage in revenue.

According to her, budget for capital projects such as the second phase of the National Council of Higher Education offices was reduced by N$5,5 million and the construction of the Keetmanshoop Vocational Training Centre, lost N$10,9 million.

Kandjii-Murangi said it is not easy to do more with less money.

The labour ministry, whose budget cut was N$4,3 million, was not affected much.

Permanent secretary Bro-Matthew Shinguadja told The Namibian last month that the ministry's development budget has not been affected and they will, therefore, continue their projects.

"I would like to inform you that the ministry's capital budget has not been affected, which was in any case already little. Therefore, the ministry's projects will go ahead unaffected," he said.


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