Edgar Brandt Windhoek-The City of Windhoek (CoW), with its approximately 2,300 employees and an annual budget of about N$6 billion, will soon run out of funds to finance basic daily operations if the current trend of its finances continues. This is according to CoW CEO, Robert Kahimise, who yesterday provided a breakdown of the city’s financial position as well as an update on the city’s five-year Transformational Strategic Plan that has been running from 2017 to 2022. Kahimise warned that if the city’s financial trend does not change soon it will not be able to replace or maintain crucial and critical infrastructure nor would it be able to plan for redundancies. “If the current trend continues the City of Windhoek will not be able to provide residents with basic services... [and] not claim to be a major African city,” said Kahimise, adding that “we are running a city that is not sustainable in terms of financing.” He noted that while the city’s assets outweigh its liabilities, its dire financial position is in part due to old debt, some of which dates back as far as 20 or 30 years. “We need to clean our books and get rid of debt. In fact, we have already identified land which we can sell to clear this debt,” said Kahimise, adding that the city’s cash flow is a key focus area. The CoW is currently burdened with a deficit of about N$420 million. In terms of revenue, Kahimise explained that about N$630 million comes from infrastructure charges while approximately N$270 million emanates from rates and taxes. Kahimise hopes to soon include estates around the capital, such as Omeya and Finkenstein, which he says make use of Windhoek’s infrastructure but do not contribute their fair share to the city’s coffers. “They need to pay for the use of our infrastructure and once this happens it will make a huge difference to turn around the fortunes of the City of Windhoek,” stated the CEO. Commenting on the city’s operational costs, the CEO pointed out that electricity, staff salaries and water are major cost drivers. On an annual basis, the city spends about a billion dollars on electricity, approximately N$650 million on salaries and some N$180 million on water. The critical state of affairs includes the city’s ICT infrastructure, which Kahimise said is in serious need of an upgrade but for which there are no funds available. “Any disaster event of our ICT infrastructure will cripple this city,” he cautioned. As a possible solution to the city’s troubles, Kahimise suggested that Central Government be tasked to provide the city with infrastructure which the CoW would maintain. The city’s top 10 capital projects for the 2017/18 financial year total to approximately N$400 million. As of the end of December 2017, the city was owed around N$634 million by both private and business residents. Government is among the major culprits in this matter as it owes the CoW about N$80 million while State-Owned Enterprises owe N$18.5 million. Some of the culprits in government are the Ministry of Education, Arts and Culture (N$24.7 million), Ministry of Works and Transport (N$15.9 million), Ministry of Health and Social Services (N$13.1 million), Ministry of Safety and Security (N$8.3 million) and the Ministry of Defence (N$4.5 million). However, Kahimise admitted that of the total debt owed by residents about N$400 million will probably be written off as it has been deemed unrecoverable.
2018-01-31 09:00:20 7 months ago