Some civil servants ‘left with N$500’ after payroll deductions

Some civil servants are taking home as little as N$500 a month after loan repayments and other salary deductions are processed through the government payroll system, a situation officials say is being driven by a lack of safeguards in the current deduction framework.

Addressing the parliamentary Standing Committee on Economy on Friday, executive director in the private office of the prime minister, Shivute Indongo, said the situation marks a departure from previous safeguards that limited excessive deductions from employees’ salaries.

“The ministry of finance had systems in place that prevented deductions exceeding one-third of an employee’s salary from being processed,” he said.

According to Indongo, the one-third rule was previously enforced through government payroll systems to ensure employees retained a significant portion of their income after deductions.

However, he said the current system no longer appears to provide the same level of protection.

“We found that virtually any deduction submitted now goes through,” Indongo told the committee.

The consequence, he said, is that some civil servants are left with extremely low net salaries at month-end.

“We have seen cases where staff members are left with a net salary of only N$500 or N$800,” he said.

Indongo questioned how workers are expected to survive on such amounts, noting that transport costs alone can exceed what remains after deductions.

“Imagine earning a salary but taking home only N$500. Transport costs alone can exceed that amount, without even considering household expenses,” he said.

He called for urgent intervention to review the deduction system and ensure that employees are protected from excessive payroll deductions.

Indongo suggested that Parliament or the Ministry of Finance should consider introducing stricter controls to ensure workers retain enough income to meet basic needs.

Deputy executive director of the Public Service Commission (PSC) secretariat within the Office of the Prime Minister, Alfred Tjihambuma, said most deductions relate to statutory obligations such as tax, pension contributions, social security, medical aid schemes, and union fees.

“However, we should also be mindful that staff members make their own financial decisions. We live in a democratic society, and individuals may approach commercial banks to obtain loans,” he said.

He added that in some cases, loans are granted without adequate assessment of the borrower’s ability to repay, contributing to rising debt levels.

“For many microlenders, a deduction code is not required. Individuals simply make arrangements and repay their loans without deductions being processed through the payroll system,” he said.

On whether the PSC has intervened, Tjihambuma said no formal advice has yet been issued.

“However, the Commission has taken note of the matter through the Office of the Prime Minister. I am confident that something will emerge from these discussions and that appropriate action will be taken going forward,” he said.

Chairperson of the Parliamentary Standing Committee on Economy, Iipumbu Shiimi, said the concern relates not to statutory deductions, but to financial institutions with direct access to civil servants’ salaries.

“These are generally understood. The concern relates to specific financial institutions that have direct access to the salaries of civil servants. This arrangement is largely unique to the public service,” Shiimi said.

He noted that in the private sector, lenders typically do not have direct access to salaries, but instead recover repayments through stop orders or debit orders after salaries are deposited into employees’ accounts.

“In the case of public servants, however, some microlenders, including some owned by banks, have been granted direct access to employees’ salaries. As a result, a civil servant may be able to obtain multiple loans from these institutions because the lenders have confidence that repayment is guaranteed,” he said.

Shiimi added that the ministry of finance merely facilitates the deductions and transfers funds directly to microlenders.

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