Response of the Namibian Catholic Bishops’ Conference (NCBC) to the 2022/23 Appropriation Bill

1. Introduction
The Namibian Catholic Bishops’ Conference (NCBC) has noted the tabling of the
2022/23 Appropriation Bill by Honourable Ipumbu Shiimi, Minister of Finance, on 24
February 2022 under the theme: ‘’Reimaging, a Better Future for the Youth.’’ The
NCBC congratulates the Honourable Minister for timely tabling the Appropriation Bill.
Against this background, we have the honour on behalf of the Roman Catholic Church,
to give our response and reaction to the 2022/23 Appropriation Bill.

As the NCBC has stated previously, the Church does not possess political power over
the temporal order. The Church has no jurisdiction over the political realm, even though
the Church possesses the plenitude of teaching authority in the sphere of religion and
morals.

Against this background, the Roman Catholic Church does not wish to prevail in public
life, and does not intend to seek power over the State, but simply wishes to contribute to
the acknowledgement and attainment of what is just, the elimination of poverty,
economic social inequality, and in shaping a morally and ethically-formed, society based
on the principles of fairness and social justice especially with regard to the distribution of
available public resources and goods, and in contributing to a more peaceful and just
world order. Our response and reaction to the Appropriation Bill is informed by the belief
that both the Church and State though independent from each other, both serve the
same person created in the image and likeness of God, hence the need to collaborate
in areas intended to improve human conditions.

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2. Positioning the response
The response and reaction of the NCBC to the 2022/23 Appropriation Bill and to public
policies of interest to the Church, are at all material times informed by major principles
of Catholic Social Teaching. Specifically, in this context:

 Protection of all human life.
 Promotion of human dignity.
 Preferential option for the poor and vulnerable.
 Building of global solidarity, subsidiarity and the common good.
 Stewardship of God’s creation.
 Universal destination of goods.

3. Context of the 2022/23 Appropriation Bill
The Honourable Minister has tabled the 2022/23 Appropriation Bill against the backdrop
of the impact of Covid-19 on the economy, job losses, impact on life and livelihoods,
high unemployment rate especially among the youth, low projected economic growth,
high budget deficit at 8.6% of GDP, high public debt expected to increase to N$ 140.2
billion during the 2022/23 financial year(Cirrus Namibia Budget Review, 2022),
undertaking not to implement any new capital project, and the Development Budget
falling to N$ 5 billion, its lowest level since the 2018/19 financial year, and high
personnel expenditure/wage bill accounting for N$ 30.1 billion or 42.6% of total
expenditure.

Against this background, the theme of the 2022/23 Budget Statement “Reimaging, a
Better Future for the Youth” symbolically speaks to the future, hopes, and aspirations
of the Nation in general and the youth in particular.

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4. Positive aspects of the 2022/23 Appropriation Bill

4.1 Social Sector spending
The NCBC applauds Government for continuing to prioritise the Social Sector Ministries
in financial resources allocation. The Honourable Minister of Finance has allocated
N$32.5 billion or 45.9% of the 2022/23 budget to the Social Sector. As it has been the
case over the years, the Ministry of Education, Arts and Culture for example, was
allocated N$ 14.1 billion, the Ministry of Higher Education, Training and Innovation N$
3.3 billion, and the Ministry of Health and Social Services N$ 8.4 billion, to mention just
a few of the Social Sector Ministries.

The NCBC supports these allocations. This is in view that, if the resources are prudently
utilized and expenditure properly monitored, these Sectors could improve the conditions
of the needy, poor, and socially and economically disadvantaged in society, hence our
support consistent with Catholic Social Teaching of the Church of preferential option for
the poor and vulnerable.

5. Matters of concern to the NCBC

5.1 Reduction in the Development Budget
Notwithstanding the difficult balancing act in resources allocation, the Bishops’
Conference noted with great concern the N$5 billion allocation to the Development
Budget. We have also noted Government undertaking not to implement new capital
projects. These are necessary, in our view, in order to improve the life of our people.

The concern is against the background of job losses in many sectors of the economy
due to Covid-19, and the correlation in Namibia between employment and level of
education. Data from the Namibia Statistics Agency (NSA) continuously and evidently
demonstrates that there is a correlation between unemployment and level of education
in the Namibian labour market.

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Capital projects offer temporary employment opportunities for the unskilled and enable
them to put bread on the table. The reduction of the Development Budget is likely to
exacerbate the unemployment and hopelessness situation among unskilled Namibians,
and would contribute to increased rural-urban migration with all implications on housing
and other service delivery challenges.

Our concern is further based on the impact of Covid-19 on the economy and prospects
of restarting the economy, and on employment creation. The Namibia Statistics Agency
(NASA) 2021 survey of Covid-19 effect on selected businesses reported that 96.5% of
businesses that responded to the survey indicated that they were adversely affected by
coronavirus and will continue to be affected in the coming months. 25.2% of the
surveyed businesses reported that they temporarily closed their businesses. 63.7% of
the businesses reported revenue loss of over 50% with Manufacturing, Hotel and
Restaurants, and Construction mostly affected.
Another 2021 NASA Covid-19 Households and Job Tracker Impact Survey reported that
about 7.3% of the surveyed population who were working before the Covid-19
experienced job losses. The main reason according to the respondents was due to
business closure. Another finding was that 59% of households experienced price
increase in major food items, and the coping strategy according to the survey results
was to reduce food consumption. 61% of the surveyed population reported that they did
not eat sufficient food in the 30 days prior to the survey.
The cited data regarding impact of Covid-19 on the economy, job losses, and food
security at household levels inform why the NCBC is deeply concerned about the
implications of the decrease in the Development Budget. This is in view that the
Development Budget is an avenue to provide employment and safety nets for unskilled
workers and those who have lost their jobs. We are deeply concerned that without
targeted strategies for restarting the economy and economic growth, job creation,
including temporary jobs, unemployment, poverty, and food insecurity will increase in
the Country. It is our wish that the Executive and Legislature will revisit the
Development Budget allocation.

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The NCBC also noted with concern over the years the tendency of funds allocated to
the Development Budget, and with the potential to create jobs, being re-allocated to
Operational Budget during Mid-Term Budget Reviews. This practice is unfortunate, as it
denies the citizenry access to services, goods, and employment opportunities.

5.2 Revenue and expenditure
The NCBC noted the estimated revenue of N$ 59.7 billion, which is higher than the
revised 2021/22 total of N$ 56.3 billion. The increase is mainly as a result of modest
improvement in revenue collection especially dividends from public enterprises. It is
evident, however, that revenue from revenue streams namely, Income Tax on
Individuals, Corporate Income Tax, VAT, the Southern African Customs Union (SACU)
will not significantly increase over the Medium-Term Expenditure Framework, hence the
need for prioritization and prudent utilization of financial resources. Corruption and
embezzlement of public resources must be fought at all costs.

It is evident that revenue forecasts during the Three-Year Expenditure Framework are
on the decline. We are deeply concerned about the decreasing revenue against
increasing demands for access to goods and services, hence the need to devise
strategies to stimulate economic growth and to enhance revenue collection.

5.3 Personnel Expenditure / Wage Bill
The NCBC continues to be deeply concerned about the ballooning personnel
expenditure on the fiscus, which according to CIRRUS Namibia 2022 Budget Review,
amounts to N$ 30.1 billion, and represents 42.6% of total expenditure. Meaning that
35.7 billion of the N$ 65.8 billion Operational Budget is consumed by personnel or
consumption costs that are not adding value to sustained economic growth and
employment creation. The high personnel expenditure is in addition to N$ 9.2 billion
interest repayment, which is higher than the N$ 5.0 billion allocated to the Development
Budget. The personnel expenditure is not sustainable, hence our deep concern about
lack of concrete policy intervention and strategies in the Budget Statement to contain
personnel expenditure.

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5.4 Government Debt
The NCBC remain concerned in addition to personnel expenditure to increasing debt.
CIRRUS Namibia expects the total debt stock to increase by 11% in 2022/23 from
125.8% to N$ 140.2. Government debt is growing at a much faster pace, hence our
concern about implications thereof on the future of the Country and inheritance of future
generations.

6. Concern on Allocations

6.1 Ministry of Agriculture, Water and Land Reform
We remain concerned about the allocation to this Ministry compared to the Ministry of
Defense and Veterans Affairs in the context of the urgent need for food security and
food self-reliance. Namibia continues to import most of its food commodities from South
Africa and the rest of the world, and this state of affairs is not sustainable in achieving
and or making progress towards Goal 2 of the Sustainable Development Goals namely,
Zero Hunger. Self-respecting nations ought to aspire to be food self-sufficient and feed
its people.
Branch of Government in particular, as we have done during our response to the
2020/21 Budget, to correct this allocation in the next budget.

7. Other concerns

 Unfortunate situation of none budgetary allocation to the Namibia Statistics
Agency to conduct the Census, and to produce data to inform evidence-based
policymaking. How will Government plan the future of the Country and improve
the conditions of the people without accurate data and information?
 The high rate of unemployment, especially among the youth. Their frustrations
and discontentment might lead to a state of anarchy.
 Low allocation to the Economic and Infrastructure Sectors to stimulate economic
growth, sustained development, and employment creation.

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 Inadequate budgetary provisions to address the housing and sanitation crisis,
food security through agricultural modernization and development, and
subsidizing of food, water, and electricity for vulnerable members of society. We
suggest to the government to approach the churches to aid it in implementing
certain of the above-mentioned projects where possible, provided the
government avails the necessary financial resources.
 State intervention is required in order to mitigate the economic hardships facing
our people: fuel hike, food prices – in order to build a happy “Namibian house.”
 It is advisable to discontinue or dissolve the non-performing SOEs for they are
only milking the State coffers.

8. Conclusion
In unprecedented times like currently, the NCBC’s wish is that the development of the
Appropriation Bill should be about prioritizing basic needs of the people. Values and
principles of good governance, transparency, accountability, and ethical conduct ought
be the norm in public office to help our Nation to become prudent in the utilization of
available public resources. It is our hope that you will find the NCBC response and
reaction to the Appropriation Bill useful, and we look forward to receiving official
feedback from your respectful Offices.

Signed on this 29 th day of April 2022 at NCBC Headquarters, Klein-Windhoek.

+Archbishop Liborius Ndumbukuti Nashenda, OMI
NCBC President

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