Construction sector not ready for NEEEF

The government’s intentions of eradicating poverty through the proposed New Equitable Economic Empowerment Framework (NEEEF) Bill falls short of being considered a sustainable solution and would likely achieve the opposite of its aims. This was the view of the Construction Industries Federation of Namibia (CIF) yesterday, following analysis of a survey conducted among its members. On the table for a number of years, the projected legislation is anticipated to address the notorious gap between Namibia’s rich and poor, and redistribute the country’s wealth to better benefit historically disadvantaged citizens. Among the tenets contained in the draft bill posted on the website of the Prime Minister’s Office is a clause requiring all newly registered businesses to set aside at least 25% of their equity in the hands of at least one partner, shareholder or member defined as previously disadvantaged. Another requirement was that existing companies be compelled to comply through government’s only issuing licences, work permits and authorisations to those found to comply fully with the NEEEF bill. Relaying the opinions of some 115 of its 465 member companies who responded to a CIF survey on the draft legislation, CIF Consulting general manager Bärbel Kirchner said the construction industry was simply not ready to comply to the new requirements yet. “The general consensus is that empowerment initiatives should not lead to distinctions based on race, which many respondents considered as unconstitutional and that it would negatively impact race relations in Namibia,” Kirchner said. “Instead, poor Namibians, regardless of racial origins, should benefit through increased focus and monitoring of already existing empowerment efforts. Respondents were adamant that wealthy Namibians, irrespective of race, should not become beneficiaries of any prospective additional empowerment efforts due to the proposed NEEEF policy or NEEEF bill.” Respondents, she said, were mostly of the opinion that current levels of education and skill in Namibia were still too low to allow for enforcement of the proposed 25% ownership by disadvantaged Namibians, or a suggested 50% board or management control by disadvantaged Namibians. “In addition, many of the small-to-medium sized enterprises that are members of the CIF, require greater access to finance, training, support in respect of marketing and to be geared to secure contracts in the industry” she said. “Results of the survey reflect that in order to tackle poverty sustainably, concerted and joint efforts need to be taken to improve access to quality education for young and adult learners. This will not only ensure that the needs of the labour market will be more effectively met, but more importantly, that Namibia’s youth reach their potential and can look into the future with hope and aspirations.” Kirchner said a previous draft of the NEEEF policy was better geared to its goals, in allowing greater flexibility in ownership and management control criteria. “The NEEEF Policy 2011 determined that businesses needed to secure a score of 50 points to be NEEEF compliant. Underachievement in one of the (overall six) pillars could have been offset against overachievement in another area…” “This would have allowed for greater flexibility and for business to retain their current status quo,” she said. DENVER ISAACS