Rudolf Gaiseb
Parastatals under the ministry of information must find alternative revenue-generating streams, with budget cuts mooted for the next three financial years.
This was revealed by information minister Emma Theofelus on Monday, when she, among others, read the Riot Act to those who have been resting on their laurels. For the next three years, the youthful minister said, each parastatal’s budget will be reduced by 3%.
“Your subsidy will be reduced by 3% in the next financial year, by another three the next, by another three the next and so on,” Theofelus said.
While the government subsidises non-commercial enterprises to sustain strategic industries and ensure public service delivery, Theofelus said the subsidy is not intended to discourage or hinder these enterprises from exploring ways to increase revenues to meet a percentage of their operational costs or even reach a break-even point.
Theofelus told New Era that enterprises get crippled while overly dependent on government bailouts.
The decision is meant to encourage innovation and enable public entities to be run with the innovative “financial prudence” they deserve.
On the other hand, the minister noted that there will be no shift of mandate towards solely revenue generation for these enterprises because the aim is not for the enterprises to achieve profit margins.
“The aim is to foster creativity in generating revenue to cater for expenses the State might be unable to afford at the time the enterprise requests. Some of these expenses may include investment in research and development, the financing of technological progress and industrial upgrading,” she added.
Budget
For the 2025/2026 financial year, the ICT ministry received a budget of over N$898 million.
Of this, the Namibia Press Agency and New Era Publication Corporation each received N$27.7 million and N$27.5 million, respectively.
After three years, both budgets will have dropped as low as N$25 million.
The Communications Regulatory Authority of Namibia (Cran) bagged N$40 million through the Universal Service Fund to establish Radio Access Networks at 15 sites.
Public broadcaster NBC received over N$350 million during the current financial year.
Cran will not be affected by the cuts, as they are not directly subsidised but funded by regulatory fees, spokesperson Mufaro Nesongano said.
Meanwhile, for the Namibia Film Commission Secretariat, N$7.5 million was allocated for the Namibia Film and Video Development Fund.
Reaction
New Era CEO Christof Maletsky welcomed the move, calling it an opportunity to work towards self-sustainability.
“And the ministry starting at 3% is a signal that we need to get our house in order. We feel that we can raise that 3% from our own funds. We can push ourselves so that we can improve,” Maletsky said.
He continued that it is a signal to parastatals that they need to get their houses in order.
“It is not a sudden implementation. At New Era, we started last year already putting into place what I call desperation mode. And that mode is to move towards self-sustainability,” the veteran journalist added.
He went on to say, “In terms of strategies, we have already started in the current financial year. We have already started looking beyond the traditional revenue streams. So that is what is needed in terms of strategies, looking beyond the traditional revenue streams. And by that, I mean the normal advertising and the real-time news advertising and so on.”
Additionally, NBC board chairperson Lazarus Jacobs expressed calm with an understanding that the cuts are normal, as the government has many priorities in terms of funding.
Jacobs said it is not yet clear how the cuts will impact the national broadcaster’s financial position, but with a strong radio, television and online presence, Jacobs expressed the salient competitive advantage.
“If you look at our social media, if you look at the number of radio stations we have, the number of TV channels we have, we should be able to not just rely on government subsidy but to be able to generate our own income,” he boasted.
Although Jacobs agrees there is a need to be more innovative commercially, not just in terms of content, he noted, “That is our challenge that we need to overcome internally on an operational level.”
The Namibia Broadcasting Corporation was allocated N$361.9 million for its operational budget and an additional N$140 million for development initiatives in the 2025/2026 financial year.
With three years’ subsidy cuts, the operational budget could stand at N$329.2 million.
The source of revenue for most parastatals, putting aside subsidies and content, is advertising revenue.
NBC leverages the Content Hub, a platform created to serve this very purpose.
Besides that, Jacobs added, there are so many other platforms they use to generate this revenue.
Analysis
Meanwhile, political analyst Ndumba Kamwanyah says the move will affect the parastatals’ ability to fully meet their public service mandates, such as providing nationwide coverage, producing educational and cultural content, and serving audiences that are not commercially attractive.
“These mandates do not always generate income, so reduced subsidies place pressure on their capacity to deliver them consistently and at the same scale,” he said.
Kamwanya is not the only one with this thinking.
Institute for Public Policy Research (IPPR) Frederico Links said that the budget cuts are long overdue.
With the state of the economy and the state of media in Namibia now, media parastatals, particularly, are already struggling and will continue to do so to fill some of these funding gaps.
Furthermore, Links suggested State media is competitively less equipped compared to private and independent media, given that it always had the “State funding crutch”.
Leveraging artificial intelligence, a business model that speaks to this new reality and tapping into revenue streams where others haven’t been able to tap them are important factors to consider moving forward, he suggested.
