Rédaction Africa Links 24 with Shelleygan Petersen
Published on 2024-03-05 15:06:03
The government’s wage bill for the new financial year stands at N$35.4 billion, which includes benefits and a 5% increase for civil servants. This information was revealed in the 2024/25 budget, which caters to 107,000 civil servants. Compared to the previous year’s N$32.8 billion, there has been a significant jump of N$2.6 billion in the wage bill.
The International Monetary Fund has criticized the government’s high wage bill, stating that it cannot rely on creating jobs. Salaries make up N$29.4 billion of the total budget, with N$1.1 billion allocated for other conditions of service. Additionally, the government contributes N$3.6 billion to the Government Institutions Pension Fund and N$107 million to social security.
The government plans to increase its personnel expenditure by less than N$1 billion. The budget indicates that the wage bill is expected to rise by N$580 million in the 2025/26 financial year to N$36.3 billion and by N$801 million in the following year to N$37.1 billion. The government’s financial year runs from April 1st to March 31st annually.
A sum of N$1.14 billion has been allocated for the enhancement of the remuneration structure of government employees. This amount includes salary increases and other benefits, details of which will be determined during the financial year. The 5% increase in civil servants’ wages is reflected in this allocation.
Finance and Public Enterprises Minister Iipumbu Shiimi announced the 5% adjustment to the civil service wage bill during his budget statement. The adjustment, costing N$1.7 billion, aims to protect against the erosion of purchasing power and became effective on April 1st.
Economist Omu Kakujaha-Matundu highlights Namibia’s position at the top of the list of countries in the Southern African Development Community with a high public wage bill. He emphasizes the government’s commitment to creating a leaner and more efficient public sector. The IMF has also raised concerns about the high public sector wage bill in Namibia, which accounts for about 40% of public expenditure.
The IMF recommends a review of the civil service and the adoption of early retirement programs as part of wage bill control measures. It emphasizes the need to balance reducing the premium on public sector wages with maintaining the quality of public services.
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