By Timo Shihepo

Copyright namibian

Draft legislation proposes giving the finance minister oversight of government purchases from manufacturers, raising fears of another Fishrot-style scandal.

Namibia plans to give the finance minister powers to set rules on how the government buys medicine directly from manufacturers or exclusive distributors without going through a competitive bidding process, according to a proposed law.

Concerns have been raised that giving sweeping powers to ministers could spark a corruption scandal similar to Fishrot, where fisheries minister Bernhard Esau had unchecked authority to decide who received fishing quotas.

Details about the proposed changes to the law come at a time when there are concerns that the government intends to use widespread exemptions for tenders linked to Swapo’s N$85.7-billion economic turnaround implementation plan.

The proposed clause in the public procurement amendment bill 2025 states that the “[finance] minister may make regulations prescribing the manner and procedures of procuring pharmaceuticals and clinical supplies directly from a manufacturer, and procuring directly from a manufacturer or exclusive distributor in Namibia”.

The Ministry of Finance yesterday confirmed that the bill seeks to give power to the minister.

The proposed bill says the government intends to give the finance minister or government bodies the powers to regulate the buying of medicine from manufacturers.

The amendment will replace the current law which has been in existence since 2015. The draft bill adds new text under the clause of direct procurement called ‘Manufacturers, single source procurement and exclusive distributor’.

It states that the Central Procurement Board of Namibia (CPBN) or other public entities must, “for the purpose of efficiency and obtaining value for money in terms of price, quality and delivery, procure pharmaceuticals and clinical supplies directly from a manufacturer”.

The Namibian understands that policy inputs into the proposed bill were provided at the Cabinet committee level last month.

Ministry of Justice and Labour Relations spokesperson Edmund Khoaseb says the bill is still at the consultation stage.

Health minister Esperance Luvindao has, over the past two months, intensified efforts against middlemen by contacting international medical manufacturers.

There are concerns that a group of medicine business people could benefit significantly from the system by acting as exclusive distributors or country representatives, rather than traditional middlemen.

The move to place procurement decisions under finance minister Ericah Shafudah is seen as a step away from good governance.

“Whether it’s to enable the Swapo implementation plan or not, it is a bad practice, and the fishing sector is an example,” a source familiar with the matter says, adding that the wording is “very wide” and leaves room for possible abuse.

There are concerns that key governance safeguards, such as the role of the CPBN, are being watered down and replaced by a ‘trust me’ approach.

Shafudah led the former National Tender Board which was replaced by the CPBN.

In May this year, economist Robin Sherbourne raised red flags about the N$85.7-billion Swapo manifesto implementation plan.He said it could be used to drive corruption to benefit individuals connected to the ruling party.

Sherbourne added: “Firm management will be required to ensure this does not simply become a recipe for massive corruption. The government’s track record on this issue is poor to say the least.

“A new and untested minister of finance does not offer hope of a hardline against graft and mismanagement.”

While the law is still in its draft stages, the Ministry of Health and Social Services is already sourcing medicine from international suppliers, bypassing local companies.

Medical tender players question which law Luvindao is using to contact manufacturers directly.

The ministry says the move is necessary to cut inflated tender costs, estimated at more than N$200 million, and to minimise corruption.

Health ministry executive director Penda Ithindi this week defended the ministry’s approach.

“There is nothing untoward. The ministry is given exemption from these provisions of the act to procure on an emergency basis until contracts are in place. There is nothing untoward about this,” he told The Namibian.

Last month, Ithindi said those benefiting from the old tender regime are resisting the new system.

“A proposition that procurement for pharmaceuticals is entirely paused is utter fabrication, most likely by individuals and entities yearning for the perpetuation of the less inclusive and hyperinflationary procurement regime of yesteryear,” he said.

Speaking on NTV talk show ‘The Agenda’ last week, Luvindao said she has no problem with middlemen but that the government must get value for money.

“A particular notion has been driven to say Luvindao has a problem with middlemen. I want to clarify that we have no problem with middlemen at all, I have huge respect for them,” she said.

She added: “But, and this is not a mere example, when a drug costs N$100 million and you’re charging us N$450 million, that’s not doing business.

That’s robbing the government. I have no problem with middlemen, intermediaries, suppliers – you name it. Just do business correctly.”

Swapo Party Youth League central committee member Taddeus Shithigona cautions against reforms that sideline empowerment.

“This step addresses longstanding inefficiencies in the supply chain where intermediaries have often inflated costs and contributed to medication shortages, but it must not come at the expense of empowering local businesses, particularly those owned by black businesses,” he says.

“To do so blindly would risk perpetuating the economic disparities entrenched by apartheid, undermining the progressive policies of affirmative action and Black Economic Empowerment (BEE) that have been central to Namibia’s post-independence transformation.”

Shithigona says the government should instead prioritise accountability, compliance and quality assurance.

“While cutting middlemen is a necessary reform, it must be implemented with eyes wide open to history’s lessons.

Affirmative action and BEE are not obstacles to progress but vital bridges to a truly equitable society. By prioritising accountability, sustainable contribution and deliberate inclusion, Namibia can secure both health for its people and justice for its past,” he says.