Harsh critique from inside out
After ten years at the helm of one of Namibia’s contentious parastatals, Motor Vehicle Accident (MVA) Fund’s outgoing chief executive officer, Jerry Muadinohamba, unleashes harsh judgments about the state of State-owned Enterprises (SoEs).
According to him, “there is a total lack of co-operative relationship from the boards to the shareholder”.
Muadinohamba who cuts ties with the MVA Fund this Friday, to venture into construction, oil and gas business, levels one of the serious charges an executive chairing NamPort and Government training agency, Nipam, could make against the shareholder. He asserts “there is too much faith in our advisors from South Africa, than in our own people”.
This Friday, Muadinohamba hosts a politically and academically star-studded public lecture on Namibia’s state of SoEs at the Polytechnic of Namibia (PoN).
Previewing his public lecture, the man who still has two more years before his term as NamPort’s chairman and whose chairmanship at Nipam was recently renewed, says the lecture is about sharing his experiences in the public sector and an attempt to instil a new mentality based on innovation.
“What most SoEs do not get right is the relationship between CEOs, boards and shareholders, which is crucial in smoothening the operations of an organisation. Even as a CEO, one needs to know they report to an authority. The board is appointed by the shareholders who also appoint the CEO. Therefore, they have to cultivate a close working relationship in which the CEO should have an effective relation with the executive members,” he asserts.
In a tell-all interview, the 42-year-old also vents his frustration at the Government Institutions Pensions Fund (GIPF) for operating in a vacuum and questions why it took it 20 years to provide a housing scheme for its members.
He says; “How could it take so long to put regulations to ensure pension funds are invested in Namibia? It is as if the board members are not Namibians. And when Government tries to intervene in parastatals, board members regard it as interference. As I bow out of public affairs, it pains me that countries like Singapore were built on pension money.”
He reveals applying for the then vacant GIPF job, three years ago and never receiving a letter either confirming or rejecting his application. However, he was "asked" to apply for the TransNamib job in which he was not initially interested and “it was too late when I decided to go for it”. Also, he never got any response on his application for the Roads Authority (RA) job.
“If given a chance, one day, I could build a better Namibia with GIPF,” says the much-respected executive who holds three Master’s degrees in development and management studies.
Somehow treating the interview like an extended therapy session, Muadinohamba questions the “excuse of lack of capacity”, in Namibians, arguing, it is more of “lack of confidence than capacity”.
Over the past three years, the Namibia Airports Company (NAC), TransNamib, GIPF, RA, Namibia Wildlife Resort (NWR) amongst other key parastatals have operated for lengthy periods without a chief executive or with an acting one.
“I still do not understand why we take two years to appoint CEOs while keeping others in acting executive positions for that long, only to finally appoint them as CEOs. What would have changed then? Is it not because Namibia looks for people who are not there? No one was born with leadership skills. One has to be taught such skills while they are on the job. Leadership is about taking an opportunity and willing to be taught.
“It is as if some people are unwilling to foster development. Why does it take 20 years to have a social development fund in the case of Social Security Commission (SSC)? Why does no one question when a policy takes decades to be implemented? In some cases, it is even painful for the board and management to hire a Namibian. We had to wait for a national policy for preferential procurement policies to be adopted because all along, it seemed haunting to award tenders to Namibians. Worse, Government’s agenda settings are never clear. Who sets the agenda? What does Government want to achieve in establishing those agendas and how do they link with Vision 2030 goals?”
Credited for growing MVA’s asset-base to N$378m from a mere N$30.9m in 2004 and boosting the investment portfolio to N$227m from N$1.3m in 2004, he admits, it was not smooth sailing.
“First of all, it is not true that the Fund was transferred from Ministry of Finance to Works, because of any differences with Minister Saara Kuugongelwa-Amadhila. She is the one who appointed me ten years ago. She is one of our competent young leaders who are straightforward, competent and good-natured to work with. She fully understood the purpose of MVA Fund. Finance never gave us any difficulty, instead, it gave us support. We had to move to Ministry of Works and Transport, because of the changes in the law in 2007. It was a strategic move to enable the Fund to cater for more people. Before then, we were sending a lot of accident victims home, because of the law that did not allow us to help them and that was the hardest experience during my time at MVA Fund — sending people home because of the law,” he explains, adding, the rules soon changed when the Fund joined Works and “I enjoyed working with the then Minister of Mines and Energy (currently Minister of Works and Transport, Erkki Nghimtina).”
Nghimtina, Muadinohamba says, is a man of great, hidden wisdom and a visionary. “He has taught me how to pass his vision to MVA Fund and NamPort. He has always been ready to guide us without interfering while encouraging harmony. The Ministry of Mines and Energy is the only ministry the Fund asked for a loan totalling N$70m in 2009, due to the Belgian accident that cost MVA Fund N$509m.
"Works’ problem has always been having more ministers than any other in Namibia. It went from Helmut Angula to Minister Joel Kaapanda and Erkki Nghimtina, within a short space of time. All had different ideas.
"Nonetheless, our work with the Ministry of Works and Transport could have been better. The was lack of collaboration at leadership level, which lead to the eruption of more clashes than cooperation. Currently, the relationship between the Namibia Road Safety Council (NRSC) and MVA Fund is fairly imbalanced.”
It is rare for a former executive, let alone a serving chairperson of two State-owned boards, to offer deep insights of leadership in Namibia. But Muadinohamba argues it helps shape policy while providing decision makers with undiluted facts for future endeavours.
“Government understands the initial purpose of setting up SoEs. However, it is the changing of ministers that creates an imbalance, as not all of them clearly understand the purpose. Therefore, constant engagement of CEOs with the higher authority is needed, as it has been lacking. Take TransNamib, for instance. It has very poor railway infrastructure, it is not economically viable and is improperly connected regionally for it to bring financial returns. The rails cannot carry high speed trains.”
As such, there is need to overhaul the infrastructure, for it to bring the necessary returns, Muadinohamba suggests. There are also inefficiencies that need to be addressed because they have had to go through many CEOs.
“That needs the constant consultation of stakeholders. MVA Fund was equally non-existent ten years ago. Constant consultations brought us this far. Look at NamPort; it has good infrastructure and stable leadership and its culture of service is impeccable but the cost of its service deliveries is high. There is need to cut the costs of service delivery, handling cargo and business transactions at large. You can only survive such through regular consultations. That is what I’ve learnt over the past ten years.”
The Fund’s finances have shown great improvement since 2008, at the introduction of the MVA Fund Act No. 10 of 2007, which essentially opened up the system for an additional 40% off claims that would have otherwise been repudiated under the 2001 Act.
As of the end of September 2013, MVA Fund’s funding level had hit 45%, compared to the 3.4% in 2010. Cash and investments enjoy an all-time health of N$256m, whilst assets stand at N$394m, compared to N$137m in 2010.
The Fund is, however, not at ease due to the rate of road crashes and the extent of eventual injuries, which require an increased outflow of medical payments.
Muadinohamba is disarmingly modest and candid about the future of the Fund, which he says should be asked of all SoEs.
“Ten years from now, the challenge to be faced by the MVA Fund will be how to further improve on meeting and exceeding the expectations of injured people and to keep thinking in simplistic but innovative ways. Innovative thinking lacks in most SoEs’ strategic plans. They prefer to stick to the logistics of the law; never taking a step to broaden their visions and opinions that could help them keep upgrading the law to what is relevant to the productiveness of the company.”
The MVA Fund is the only parastatal to have effected a strategic succession plan in Namibia when Muadinohamba, two years into his second term, informed the board he would not renew his contract and a succession plan was hatched.
Vivacious former corporate relations officer, Rosalia Martin-Hausiku was selected from the resultant process for the CEO position and has been under the tutelage of Muadinohamba for the past six months.
Touting on the biggest lesson learnt, for Muadinohamba, “People make the difference, not their buildings, names or CEO titles.”
He concludes, “When you give people an opportunity to air their views, to take what they are saying and incorporate it into the company’s vision, it will lead to a successful company. That’s what sustained me in the system.”