Windhoek-Minister in the Presidency in charge of the National Planning Commission Tom Alweendo joined other national leaders pouring cold water on suggestions that the government is broke, saying this conclusion is irresponsible and causing unwarranted pandemonium in the country.
Alweendo, formerly the governor of the Bank of Namibia, said government expenditure projections were based on estimates of how much revenue it would make, but such estimates proved wrong as no such amounts of money poured into state coffers.
As a result of revenue shortfalls, government had to scale down on expenditure in order to ensure that available resources are used prudently.
Government has embarked on budgetary cuts during the current financial year, but Finance Minister Calle Schlettwein said this is a precautionary measure rather than a sign of a financial crisis in government.
For the current fiscal year revenue shortfalls amounted to N$6.2 billion and given the very limited scope for debt Schlettwein’s hand was forced in cutting expenditure by N$5.5 billion during the mid-year budget review.
Of the N$5.50 billion, N$2.82 billion was sourced from the operational budget. Experts hailed this move, saying it marked the first time that an operational budget has been slashed. The wage bill, which accounts for close to 40 percent of the total expenditure and the hardest part of expenditure to cut, was reduced by N$633.39 million.
Alweendo, speaking to editors and senior news managers in Windhoek last week, said the media’s demands for the government to admit it is broke are overzealous.
“It’s true there are times when we get things wrong in government but there are also times when we get them right. As for whether we are broke or not, I don’t know how you want it to be said,” the minister said. “It will be irresponsible for the government to say it is broke. Look, what we are saying is that we have budgeted based on projected revenues. But because income wasn’t as much as we thought it would be, we had to bring down expenditure.”
“We’re now being forced to say that we are broke, based on this. It’s irresponsible. Of course we shouldn’t pretend that all is well – and we didn’t – that’s why we are scaling down on expenditure.”
He said overreliance on the government has been a catalyst in the financial situation currently playing itself out.
“The private sector isn’t doing enough. They too rely heavily on government tenders and contracts so when things are not going well in government, the effects are seen in the private sector too.”
“I’m not in anyway trying to say some of the things being said about government are not true. And when I talk about overreliance on government, I’m not saying government has got no role to play. But I still think that as a society we can’t lead a life where when anything goes wrong in my life, the blame is on government. It’s just not right,” the former director-general of the National Planning Commission said.
“You could argue that we, as government, should have projected these challenges – yes maybe we could have but there are so many people who also didn’t see it [reduced revenues] coming.”
“You could then pressure me to say that I didn’t get my prediction right and that I must admit fault. I always say you can only get things right if you admit your wrongs, but unfortunately we live in a society where if I say I am wrong, people will start bashing you. This scares a lot of people to admit that they are wrong – for fear of getting bashed,” he said.