Namibian national budget 101
After the national budget was tabled on 7 March, The Zone dissected it to make sure all questions that the youth are burning to ask were answered.
13 March 2018 | Education
The perception is that many young people in the country are not interested in politics. This sentiment is shared by Joseph Kalimbwe, former Unam SRC President 2017 at the political panel discussion hosted by the Namibia National Students Organisation (Nanso) last year. “Young people just need to participate by getting involved in activities of questioning the government's decisions, activities and ways of governance,” Kalimbwe said. He challenged the youth to challenge the status quo and to not to just complain when things are not going right. “It is very important that the youth cease to be social media complainers as they have to get involved in the decisions being made by the government,” he urged.
While the decisions made by our elective representatives have a direct impact on our lives, it is rare we get a chance to voice our opinions in the decision-making process itself. Sometimes it is due to the fact that some of us are below the age limit that grants us our voting rights.
How is the budget drafted?
The N$ 65 billion budget was tabled by finance minister Calle Schlettwein, in the National Assembly last week. This is N$1.5 billion less than the revised N$66.5 national budget of the previous year.
A lot of young people wonder how the budget is drafted. During an interview Schlettwein at a PWC Budget Review dinner, he explained that a lot of factors are considered before drafting a budget.
“The first criteria our ministry looks at is how much money is available. We also look at how much revenue we collected and how it could be distributed. Secondly, we look at how much we can borrow. Once you have those two factors in check, then you will know what your total envelope is,” he said.
He continued by adding that the budget looks at the country’s most immediate needs. “Is it in the social sector, employment, safety and security, education or health? Overall, we go back to our policy that we as the ruling party have and there we find that the we place great emphasis on being a people-centred government, so youth employment, poverty eradication and inequality erosion is what matters most,” he explains.
Indileni Nanghonga, an economist from Simonis Storm told The Zone that the national budget should set up the financial targets and the level of expenditures compatible with these targets. “This is useful when preparing the macro-economic framework. It should also allocate resources toeing the line of both policies and fiscal targets. In addition, financial forecast is important. A financial forecast is a fiscal management tool that presents estimated information based on past, current, and projected financial conditions,” Nanghonga said. “This will help identify future revenue and expenditure trends that may have an immediate or long-term influence on government policies, strategic goals, or community services.”
In Namibia, the Financial Year (FY) budget is tabled once a year. “We however have a mid-term budget review which started in 2016 to give an update on issues addressed or proposed during the budget,” added Nanghonga.
According to Schlettwein the money allocated toward certain ministries are also focused on addressing social inequality. “Because of our large disparities in inequality or income distribution, there is no drastic change in the short term budget. The split between social and non-social expenditure remains pretty stable,” he said.
Basic and higher education will, as usual, receive the bulk of government’s money and have been allocated N$13.5 billion and N$3.2 billion respectively. Of the N$3.2 billion allocated to higher education, government has allocated N$960 million to the University of Namibia (Unam), N$600 million to the Namibia University of Science and Technology (Nust), while N$1.45 billion has been earmarked for the Namibia Students Financial Assistance Fund (NSFAF).
Lebbeus Hashikutuva, Nanso’s secretary of finance, is satisfied with the funds allocated for education. “I am a great champion of education in Namibia. Inclusive education carries great potential to reduce poverty, and quicken the rate at which black Namibians acquire capital and equity,” he said.
Hashikutuva says the money set allocated shows that government is serious in its efforts to advance the education agenda. “It is really pleasing to see that the allocation to education, as has been the norm, has increased.”
“We can only hope that the increases in the ministry of basic education, more specifically, can truly contribute to the ministry’s target of seeing an increase in the National Senior Secondary Certificate (NSSC) pass rate through organised tutorial workshops and training.”
Curbing youth unemployment
Schlettwein said the fact that the education sector gets over 28% of the budget is very high in comparison to other countries in the world. “Namibia spends a lot more on youth and education compared to other countries. We also have ministries that received funding for youth entrepreneurship, there are quotas for small and medium enterprises and we have the bursary schemes that is exclusively targeted for young people.”
Nanghonga agrees with the minister and highlights the importance of different youth empowerment initiatives. “The budget emphasised that initial funding is provided for the roll-out of SME financing strategy and youth entrepreneurship, comprising of the Venture Capital Fund, Credit Guarantee Scheme and Training and Mentorship Program,” she said.
“This is in addition to funding for the Equipment Aid Scheme and related SME support programmes. Such expenses should however result in fruitful returns such as youth employment.”
Hashikutuva says the money allocated for the NANSO seems reasonable, “especially considering that students at vocational training centres are no longer going to be funded through NSFAF’s budget, but rather through the budget of the National Training Authority.”
With many young people around the country all study hard with the hope of securing a well-paid job. However, not all aspire to work for someone else; some prefer being job creators than job seekers. The budget seems to favour those who prefer being their own boss with the different funds allocated to improving SMEs.
Nanghonga urges the youth to understand that responsibility cannot be split. “If you give someone the responsibility of making a success of yourself, it can then be used it as an excuse to slack-off when the going gets rough. We need to be vibrant and willing to participate. Take part in opportunities presented to you as a young person and stand out. We are the future generation and we need to be innovative and great originators,” she said.
Using the right tools provided to them
Nanghonga advises young people that funding is not enough and that it should only be viewed as a stepping stone. “One needs to have an idea and the passion that drives the idea. Financial support is only an ingredient. The government should however continue to be enabler of great initiatives and innovation brought forth by the young people,” she explained.
Hashikutuva agrees and adds by saying: “Budget figures do not matter, if money is not used prudently, and if sound accounting practices are not kept to. I can only hope that the money allocated to the different units of government is used in the best interest of the Namibian people, and more importantly, in the interest of the Namibian child.”