- Posted February 18, 2013 by
Namibian government running out of money
Following the Zimbabwean ministry of finance’s recent declaration that it had a bank balance in the low hundreds of pounds, it seems another African government is running low on funding; the Namibian ministry of finance is desperately looking for additional sources of cash so that it can fulfil its pensions and disability grants for the remaining two months of the financial year.
The government ran into fiscal difficulties after depleting its Contingency Fund long before the deadline and is now seeking an additional N$152 million so that it can pay pensioners for February and March.
Finance Permanent Secretary Ericah Shafudah has confirmed that the ministry of labour and social welfare has requested the ministry to cover for a “shortfall on the basic state grants”, which amounts to more than N$216 million.
According to Shafudah, the money needed is above the amount left in the Contingency Fund, which is supposed to be kept aside for emergencies, and therefore other ways have to be found to cover for the shortfall of N$152.
An additional amount of N$48 million will be paid out of the Contingency Fund, which according to her will deplete the fund, leaving a shortfall of $100 million for February and March.
In the meantime, the government also has insufficient funding to implement the 8% salary increase for public servants which was agreed with trade unions last year. It was planned that this shortfall would be covered from the Contingency Fund, however the other funding problems have rendered this impossible.
These ministries will now reportedly have to use money allocated for capital projects to honour the implementation of the salary increase.