Loss-making parastatals a liability – Shifeta

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Windhoek

The Minister of Environment and Tourism has threatened to take parastatals to task whose managers are in direct violation of the State-Owned Enterprises (SOEs) Act, due to anomalies such as lack of annual general meetings, non-payment of tax to government and incurring losses each year.

Minister Pohamba Shifeta feels some chief executive officers (CEOs) accumulate losses due to their incompetence and sharply criticised some CEOs and managing directors of SOEs during a meeting with staff, partners and associates of the ministry on Monday.
“Some companies have no annual general meetings where they are supposed to meet with the shareholder to discuss and adopt certain measures. It looks like some companies have never had them. You are violating the law, unless you have agreed with the shareholder.

It’s something I won’t tolerate… and also those who deduct pension, tax and social security from employees but never pay to the Receiver of Revenue. It’s very embarrassing,” the tourism minister said. He further observed that government is always tough on private companies, “but our babies here (parastatals) are so spoiled”.

“It’s theft and they should be arrested. I hope this won’t happen again. I have already notified board members verbally that these obligations should be adhered to. If something like this happens I will take the board to task and the board will take [on] those managers,” he threatened.

He put emphasis on three tourism companies, namely Namibia Wildlife Resorts (NWR), Windhoek Country Club and Resort (WCC), as well as the Zambezi Waterfront and Tourism Park (ZWFTP).

“These companies are supposed to make money and not become a liability to the shareholder. If you have a company and it’s never making money – not even a break-even – then why call it a company? Call it Red Cross or something, because it’s not making any money.

“If you have a company and it is not making money for so many years and it can’t even cover its operational budget, the owner will say: ‘Get rid of that liability’. Unless we turn that company into Section 21 to be a welfare [service] to help people who have no employment. The shareholder (government) wastes a lot of money, resulting in mismanagement,” he said.

He said NWR and Windhoek Country Club Resort have to shape up and start making money, because they have been in the industry for long. He said boards of directors should know they are running these firms on commercial principles and not as “welfare organisations”.

“They must cater for themselves, except one which is still a baby (Zambezi Waterfront). They cannot come to me and say, ‘We don’t have money anymore’. You must know you run a company based on commercial principles.

“They come to me with turnaround strategies and I don’t even know where they got that concept – which never works anyway. Don’t even think of coming here, do what a company is supposed to do,” he lashed out.

Shifeta said he observed there are managers who are more powerful than their appointing authority (board of directors), which he says is a very dangerous precedent that violates the law. He said many CEOs and managing directors approach his office directly, thus circumventing their board of directors who have “fiduciary duties by law”.

“If anything goes wrong in the company you can be taken to task. Boards of directors should direct the managers. It is no more business as usual for SOEs under the ministry, as I demand change on some of the anomalies I have observed.

“We have serious challenges in terms of efficiency, management of financial resources and delivering on the mandates that are the reasons of our existence,” he cautioned. “I want you to act against staff members who fail to do their job in accordance with the Public Service Act. This year we should have zero tolerance for laziness, laxity and complacency.

“If you are one of those rotten apples that do not take your work seriously, this year you should leave such habits behind, or else the system will push you out. We cannot afford to have two different elements pushing in different directions in one organisation,” he said.

Shifeta also advised staff members to be tolerant of each other within the workplace. “Insubordination is clearly addressed and defined in the Public Service Act. What I could detect is that people have excuses for not delivering when given tasks.

“Every misconduct, no matter how small should be recorded. I don’t want someone saying this person has a lot of misconduct, but there is no file. I know most of you like to go to trade unions and courts, even if you are wrong. So listen to your colleagues and also do self-introspection.”

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