President Hage Geingob has in recent months raised the issue of cutting the size of the bloated civil service.
Statistics from the Public Service Commission show that Namibia has 71 000 civil servants but the number increases to 107 000, with the inclusion of members of the Namibian police and other security wings. The civil service has increased by 10 000, ten years ago to the current 71 000.
An Economist at Simonis Storm Securities, Theo Klein believes the issue is a sensitive one politically, given that a lot of public servants are also SWAPO voters, according to local political scientists.
“At the same time, laying off workers and increasing the number of joblessness in these inflationary times would be bad for the economy. I would argue that the government must focus on getting its management right. We need more business minded management styles in various government departments, ministries and public administration services.”
Klein says this way, the government can make better economic use of its workers and earn a higher return on their salary investments.
“Having more efficient public workers in administration services will go a long way in improving Namibia’s ease of doing business and so it could lead to better economic growth in the medium- to long-term. From higher economic growth, public revenue can improve and so the affordability of public wages can improve in turn.”
Asked how he rates the performance of the civil service in comparison to its size, Klein said there is a view widely held that the performance of public workers is poor, especially in various public administration services where inefficiencies lead to a poor ease of doing business in the country.
“This is evidenced by the fact that our public wage bill has grown over the long-term, but Namibia’s ease of doing business has deteriorated at the same time, “Klein said.
Klein says the size of the civil service cannot be reduced without causing social upheaval.
“No, there will definitely be resistance from public workers. You might see protest action from workers and the unions strongly fighting against this, “he addef.
On the issue of the civil service N$30 billion wage bill being a drain on the economy, Klein says it must have remembered that public workers have families to take care of and they also pay taxes and spend money in the economy.
“However, based on the share of the total budget that they get, the return on investment is very low and does not justify such a high wage bill. That’s why we argue that government needs to make better use of its workforce and try to get a higher productivity from public servants, “he stressed.
Meanwhile, the Public Service Commission says it would require a study to look at the possibilities of resizing the civil service. The Commission says resizing would require studies and benchmarking.
Rating and donor agencies are also concerned about the large civil service. The International Monetary Fund said implementing the authorities’ fiscal consolidation strategy is crucial to preserve debt sustainability. The Fund said containing the wage bill, advancing the reform of state-owned enterprises, and strengthening tax administration is key.
Despite these concerns, civil servants have continued to ask for higher wages. In March, unions representing civil servants said they would demand an 8 percent salary hike across the board, an increase in housing allowance for below management by 20 percent and an increase in housing allowance for management by 8 percent.
