Reduce civil service: DTA

24 Jan 2017 17:20pm
WINDHOEK, 24 JAN (NAMPA) - The DTA of Namibia has called on Government to immediately reduce the size of its civil service and allow the economy to grow.
This, the party said, was because the civil service accounts for a disproportionate percentage of the public expenditure through the civil service wage bill.
DTA of Namibia Treasurer-General, Nico Smit said in a media statement issued on Monday, Government should never be directly involved in employment creation, as is the case currently.
The civil service wage bill in 2015 stood at about N.dollars 22.9 billion with 100 000 public servants before Minister of Finance, Calle Schlettwein in August 2016 froze all State recruitment in an effort to reduce expenditure.
Smit said Government’s role in creating employment must be limited to creating and maintaining a legislative and policy environment, conducive to the establishment of private business and attractive to foreign investment.
He said Government’s failure to heed the call to do away with all targets for budget deficits and aim for generating a surplus will result in further negative downgrades.
Fitch Ratings and Moody’s Investor Service in late 2016 consecutively downgraded the Namibian economy’s outlook for 2017 from stable to negative.
The downward revision cited the country’s ballooning budget deficit, as well as the unrestricted growth of public debt as the main contributors to the downgrade.
The DTA also noted that the Ministry of Justice’s announcement to put on hold recruitments into the Namibian Police Force (NamPol) for the next three years was a clear indication that Government faces a liquidity crisis.
Smit explained the cost of borrowing will continue to increase, while liquidity will come under increasing and severe pressure, which will result in an economy stuck in a serious and protracted recession.
“Government’s ad-hoc crisis management approach to addressing the pervasive haemorrhaging of the economy is not sustainable in the long term,” Smit said.
He added that government must do away with all budget deficits and compile a national budget aimed at generating a surplus, as this will result in an upward impact on the cost of servicing government debt.