Economist Hei says throwing money at education won’t fix unemployment

Economist Salomo Hei has questioned whether Namibia is getting value for money from the billions poured into education, warning that rising allocations have not translated into better outcomes.

Hei made the remarks on Tuesday during a pre-budget discussion hosted by the Economic Association of Namibia, ahead of the tabling of the 2025/26 Appropriation Bill expected next week.

“We are creating this huge unemployment problem, and this unemployment problem is going beyond the unskilled,” Hei said. “We are creating graduates that are now unskilled. But we’re spending so much money on education.”

His concern cuts to the heart of the national budget.

The government had allocated N$24.8 billion to education, innovation, arts and culture for the 2025/26 financial year — the single largest share of the N$106.3 billion budget that was tabled in March last year by finance minister Ericah Shafudah.

Over the medium-term expenditure framework, the sector was set to receive N$76.1 billion.

On top of that, Shafudah announced during the mid-year budget review in October last year, that N$814 million had been proposed for the Ministry of Education, Innovation, Youth, Sport, Arts and Culture.

Of this, N$663 million was earmarked for registration and tuition fees for the first quarter of 2026 as part of the planned rollout of subsidised free tertiary education. Another N$151 million was allocated for the recruitment of 665 teachers.

Return on investment

Yet Hei argued that large allocations alone do not guarantee better results.

“We need to demand a return on the investment,” he said. “Even if you’re spending money on salaries, which is the operational budget, there must be a return on that investment on the teacher.”

A significant portion of the education budget goes to personnel costs, as reflected in the broader operational budget, which stands at N$79.8 billion for 2025/26.

The development budget, by contrast, is N$12.8 billion.

Hei questioned how learners can struggle with basic literacy and mathematics but still proceed through the system.

“You cannot have students unable to get through Grade 12 to pass basic literacy around mathematics to get into a university,” he said. “Because what will that person go and study?”

He also raised concerns about the rapid growth of higher education institutions, saying this could lower academic standards.

“You cannot throw money at a problem hoping you solve it,” Hei cautioned.

Namibia’s education spending has long been framed as pro-poor and pro-growth. But with youth unemployment stubbornly high, Hei said the country must be honest about whether the current model is working.

He linked the education debate to the wider economic picture, including the anticipated oil and gas boom and proposed changes to the petroleum law. Namibia, he said, must avoid repeating past mistakes made in other commodity cycles.

“We have discovered other commodities and we have not covered ourselves in glory,” he said, pointing to countries such as Norway that built strong state capacity and invested carefully in their resource base.

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