The Central Procurement Board of Namibia (CPBN) says it has disbursed N$7 billion worth of tenders in the past five years of its existence.
Of the disbursed amount 75% (N$5.2 billion) of the tenders were awarded to 100% Namibian-owned companies.
The CPBN said it will need a cash inflow of N$409.92 million to sustain and successfully implement its new Integrated Strategic Business Plan (ISBP) to run until the 2027/28 financial year.
The five-year ISBP launched today in the capital by Finance and Public Enterprises Deputy Minister Maureen Hinda-Mbuende outlines that CPBN’s cash inflow will be derived from a government grant of N$41.2 million for the current financial year, while for 2024/25 it needs N$59.93 million.
The amount further increases to N$70 million in the 2025/26 financial year and N$103 million for the financial years 2026/27.
Other cash inflows will be generated from sales of bids and interest received totalling N$3.49 million and N$1.28 million, respectively, in addition to the existing amount of N$28 million in the Bank Windhoek Call Account.
The Procurement Board further projects to have a closing balance of N$4.85 million at the end of the ISBP, after an estimated cash outflow of N$405 million to be spent on board and employee salaries, conferences, consulting and legal fees, travel and accommodation and office expenses, among others.
“It is clear that CPBN is dependent on government grants to sustain its operations in the absence of alternative sources of funding. CPBN had funds available from its reserves over the years, but have since been depleted hence the need to fully depend of government. The projected increase in grants is due to the operational and capital expenditure,” the ISBP report states.
“CPBN has improved significantly since its inception in 2017. This is evident in the drastic increase in the number of awards from only one procurement contract awarded during its first financial year (2017/2018) compared to the awarding of 21 procurement contracts during the 2022/2023 financial year.
“Furthermore, the value of procurement contracts have also increased from N$111 million during the 2017/2018 financial year to over N$2.2 billion worth of procurement contracts awarded during the 2022/2023 financial year. In total, procurement contracts worth over N$7 billion were awarded in the past five years,” Hinda-Mbuende said.
She added that the Central Procurement Board of Namibia plays a crucial role in the economy as well as in the attainment of national developmental goals of economic growth and the reduction of unemployment.
“I am happy to learn that 75% of procurement contracts awarded by CPBN were awarded to 100% Namibian-owned entities in the past five years. However, we need to interrogate the 100% ownership real business models as it is known that we have a phenomenon of packaging and repackaging and in some cases briefcase businesses,” the Deputy Minister said.
“We need to measure real economic impact or rather how much of it is exported. How much of the N$5.2 billion is circulated in Namibia? The compliance audit for local procurement generally raised similar concerns.”
There has been a low level of compliance by public entities disregarding the provisions of the Public Procurement Act.
However, the public policy unit has been enforcing compliance by holding public entity executives accountable, the strategic plan, highlighted by justifying the anticipated workforce expansion from the current 40 employees to 54 in the next five years.
In total, it has an approved staff complement of up to 65.
“It is also no secret nor understatement that CPBN is facing criticism for its inability to meet performance. The perception is that there are delays in the procurement process due to poor management of CPBN coupled with inefficiencies. Therefore, it is my sincere hope that the new strategic plan will assist in improving on better coordination with public entities, and continuous capacity development,” she said.
In the 2023/24 strategic plan, CPBN aims to achieve 90% stakeholder satisfaction, as well as consistently achieving an annual 5% budget variance through effective and efficient financial management.
It further aims to empower Namibians by awarding 80% of bids; ensuring 100% of the bids are finalised within the 120-day procurement circle, as well as maintaining 100% timely execution of contracts within the budget.
Meanwhile, CBPN acting administrator, head and chairperson, Amon Ngavetene said the Strategic Plan gives them a sense of direction and march them around a common vision.
In addition, he said CPBN should not only be seen as a mere procurement undertaking wherein the majority see it as a transactional exercise but rather a mandate of the board as having a social and economic transformation dimension.
“The resultant effect of procurement should lead to industrialisation, manufacturing, employment creation and empowerment. It is true that statistically we can speak to the total value of procurement, number of procurement contracts, etc. But the fundamental sacrosanct question should hover around the impact of procurement on the life of the ordinary citizen. It is a salient aspect of our conduct that by virtue of accepting a role at the Board, we have entered into a social contract with our fellow country men and women,” he stressed.
“Moreover, one of our values in terms of the Strategic Plan is accountability and transparency amongst others. We can only emulate and practically live to these values if we open and share our processes with the public and our stakeholders openly. We can only be trusted as a responsible corporate citizen if we rationally and factually explain our decisions in an honest truthful manner,” said Ngavetene, whose tenure is ending next year after having served two terms.
“It is on this basis that today, we are equally also introducing our revamped website.
The Central Procurement Board and the whole procurement regime is one of the most effective, reliable and well design systems in this country. When we experience shortcomings, we will not scrap the foundational basis of the building (system), but we will rather fill the cracks to perfect it,” he said.
