Windhoek-Public Enterprises Minister Leon Jooste has dismissed suggestions that his drive to reform and restructure state-owned enterprises, which picked up high tempo in recent weeks, has any malice or hidden agendas underlying it.
Jooste has proposed, amongst others, that government close down the Roads Contractor Company (RCC), which until this week could not pay the salaries of its staff, and restructure TransNamib to allow private investors to partner with government in running it.
He was also unequivocal that he “has never made a recommendation to Cabinet (or any Cabinet committee) that any SOE should be privatised”. On the contrary, he says, there is “due regard to all the potential consequences and we will only make proposals after thorough analysis, consultation and evaluation”.
This was Jooste’s first public pronouncement on the plans for RCC and TransNamib, since the revelation of the ministry’s ‘position paper’ that proposed “winding up the RCC [as] the preferred option” and expressed concern with TransNamib’s ability “to deliver competitive, reliable bulk freight transport service considering the current state of the infrastructure”.
The proposals have not been well received by some, who see them as attempts to strategically position the interests of a well-connected few in the private sector, in the guise of introducing efficiency in public-owned enterprises.
“There is no set agenda for the reform process other than that national socio-economic interests are safeguarded,” said Jooste, adding that all possible measures are being explored “to ensure that the public enterprises perform well in their respective sectors, and move to a point where they no longer rely on government support for operations.”
Jooste’s comment comes ahead of the Cabinet Committee on Overall Policy and Priorities, which was scheduled to consider these very proposals, quite likely including the recommendation by Treasury that Air Namibia abandon the Windhoek-Frankfurt route.
Treasury’s proposal has angered some at the national airline and Works and Transport Ministry, who have since pointed out that the N$30 million losses being cited are exaggerated and that the financial risks regarding late payments for the lease of the aircrafts for the route, were in fact caused by Treasury.
New Era has seen a cache of communications between Treasury officials and senior officials at Intrepid Aviation USA, the global aircraft leasing company from where Air Namibia has leased aircraft, to rebuff suggestions that the airline has failed to pay rental fees on time.
The correspondence deals with the issue of late payment, with Intrepid Aviation officials reminding Treasury to pay on time and Treasury officials trying to explain that the delay in payments was a result of the absence of a “call for payment”, among other reasons.
Jooste, nevertheless, said throughout the process of reforming public enterprises “we need to have an open mind to find the most appropriate combination of measures for each public enterprise. I want to categorically state that the Ministry of Public Enterprises, or myself as minister have the best interest of our national economy and collective social well-being, and the public enterprises that play an important role in these realities at heart.”
He said his ministry “is not using a cookie-cutter approach, but assesses each public enterprise from a financial, socio-economic, legal and human capital perspective. That analysis informs our recommendations”.
Further, Jooste said public-private partnerships (PPPs) in public enterprises will be subject to the provisions of the Act and will originate from the public enterprises, not from line ministries.
“We have not been informed of any new potential PPPs at any of the public enterprises,” he said of the fear that RCC and TransNamib were being used as guinea pigs for future PPPs.
“PPPs cannot be described as any form of ‘privatisation’, as these agreements do not entail the alienation of shareholding. If any shareholding in a public enterprise is considered, it will be regarded as a ‘restructuring’ exercise and this will have to follow due process, as per the legal requirements of the Public Enterprises Governance Act,” he said.
“The fact of the matter is that we now have a dedicated Ministry of Public Enterprises to empower the government in its role as shareholder to become a professional, responsible shareholder on behalf of the people of Namibia.
“Our ministry is bringing about change and human nature dictates that change is more often than not met with resistance. I often quote Einstein on his definition of insanity, which is ‘to do the same thing over and over again, expecting different results’. The tricky part is to lead change and to manage change,” the minister said.