NAC State of Affairs Statement

28 Jan 2020

STATEMENT BY THE CHAIRPERSON OF THE BOARD OF DIRECTORS OF NAMIBIA AIRPORTS COMPANY DR LEAKE HANGALA, AT A PRESS CONFERENCE AT HOSEA KUTAKO INTERNATIONAL AIRPORT ON 28 JANUARY 2020

 

It is with great pleasure that I take this opportunity to present to you the performance, achievements and the roadmap on the state of affairs at Namibia Airports Company.

 

This briefing is in line with the commitment I made at my first press briefing that the Board would, now and then, brief the public on the progress made and the challenges that the NAC are facing.

 

  1. Corporate Governance

 

The company’s mandate is to develop and manage aerodromes in line with national and international civil aviation regulations. As part of our corporate governance responsibility, the board is entrusted with its fiduciary responsibility to steer the organization by creating an enabling environment to ensure that it delivers its mandate. The Board in its quest to achieve this mandate has put various structures in place – to with the full cooperation with Management create the right environment in pursuit of this mandate.  The Board therefore, ensured during its term that it provided the strategic direction to allow the NAC to flourish under very difficult circumstances - circumstances that were under the control of the board and circumstances that were not under our control.

 

  1. Given the significant and critical role played by airports , and invariably the NAC in  the Namibian economy,  in developing and promoting economic growth, we have the very important task and  mandate to ensure that the organizational strategies are streamlined to promote trade and investment; travel and tourism and to meet the objectives outlined in the National Development Plan 5, Harambee Prosperity Plan with the view to position Namibia as a logistic hub and to ultimately contribute towards improving the livelihood of each and every Namibian citizen.

 

  1. In evaluating one’s own performance, as part of the principles of good corporate governance, you ask yourself – did we always fulfil the mandate and the expectations from the Shareholder as the representative of the nation? Allow me, to respond to this question very openly and frank – no, not always, in fact the NAC has been a source of concern to its shareholder and the public at some stage as it was assumed to be instable and operating on unsound business practices, but in the same breath I wish to state that with the leadership and insight of the Board the fate and performance of the company has significantly changed over the last 12 months. The board is proud to acknowledge the impact made with the appointment of Mr Bisey /Uirab as substantive CEO on 1 May 2019.  The organization is stabilizing and concerted actions have been undertaken to improve service delivery; to ensure continuous engagement with our stakeholders internally and externally in improving service delivery and to ensure that the company fully complies with all laws, rules and regulations that governs its operations.  More importantly, improved financial management systems and processes are in place to ensure that the organization meets its operational expenditure within its operational income and that the organization is dedicated to ensure that its employees live up to its core values to restore its brand value and confidence of all our stakeholders.

 

  1. ORGANIZATIONAL TRANSFORMATION

 

Allow me to highlight some of the management actions geared towards the organizational transformation and restoring the organizational brand value:

 

  1. In order to address the inefficiencies and ineffectiveness of the existing organizational structure in propelling the company to deliver on its mandate, a new structure for top and middle management has been developed and approved. The recruitment process for senior management and executive management in the revised structure has been completed and has attracted highly skilled personnel that will meaningfully add value in leading the organization.

 

  1. The Renaming of the Ondangwa Airport after the liberation struggle icon, the late Andimba ya Toivo that was officiated by His Excellency Dr Nangolo Mbumba, Vice President of the Republic of Namibia on 22 August    2019;

 

  1. The Ground breaking ceremony of Hosea Kutako International Airport, Congestion Alleviation Project that was officiated by the Right Honorouble Netumbo Nandi – Ndaitwa Deputy Prime Minister and Minister of International Relations and Cooperation on 16 September 2019;

 

  1. Briefing on the mandate of the company to the Parliamentary Standing Committee which was a success;

 

  1. Participation in the Public Enterprises CEO AGM and Sport Games which was held at Luderitz on 6 – 9 June 2019.  This is the platform where public enterprises get together to collectively look at challenges and opportunities and also at this forum to NAC could highlight its transformational plan and achievements.  The team scooped two gold medals in Volleyball and for the Best Team Spirit. The ladies’ relay and received the silver medal. This manifests teamwork translating that together as a team the organization can achieve more.

 

  1. Conducting a Customer satisfaction and stakeholder engagement survey - this survey will be indicative as to the achievement of the goal to become a strategic and reckoned public enterprise and it is envisaged to complete this exercise by the end of January 2020.  The outcome of this exercise will be incorporated in the strategic plan to ensure that we deliver our mandate to the expectation of our shareholder and to improve on customer service delivery.

 

  1. LEGAL MATTERS

 

  1. Noting that the organization faced challenges over a prolonged period, it has been exposed to a number of court cases. Considerable progress has been made to reduce the number of pending court cases and legal risk faced by the company.  

 

  1. I will fail in my duty if I do not refer to at least two matters, that attracted significant media attention and has impacted negatively on the organization:

 

  1. NAC//China State Engineering where NAC approached the courts to request a self-review of an appointment of China State Engineering as the contractor for Phase 2 of the Ondangwa Runway, Taxiway and Apron Rehabilitation project. The court ruled the matter in favour of NAC and China State has approached the Supreme Court to appeal the matter. The matter is set down for adjudication in the Supreme Court on 6 March 2020.

 

3.2.2   Aurecon Engineering Consultants // NAC. this matter pertains  to  phase  2 of the Ondangwa project. The matter was settled in November 2019.

 

  1. Similarly, the NAC is not unique when it comes to internal legal challenges. To date six labour cases have been finalised in an amicable manner at the Labour Commissioner since May 2019 and no new labour cases have been initiated – this is attributable to a favourable internal organizational climate that has been established where the employees are valued and their contributions are recognized.   

 

  1. AIRPORT OPERATION AND FACILITATION

 

  1. In pursuit to ensure that we manage airports on sound business principles and with due consideration of our stakeholders, it is imperative that we continue to adhere to the national and international civil aviation regulations.

 

  1. In October 2019, the Namibia Civil Aviation Authority conducted a fit and proper persons test as is prescribed in terms of the Civil Aviation Act and Regulations and the CEO was successfully appointed as the Accountable Manager.

 

  1. Furthermore, the Namibia Civil Aviation Authority as a Regulator conducts audits at all NAC airports to ensure compliance to both National and International regulations. Certain compliance issues have been identified by the Regulator over the years. We are addressing these issues to ensure that we maintain safe and secure airports and action plans on corrective measures have been put in place to close these findings.

 

  1. Subsequently, Hosea Kutako the flagship airport has improved significantly in the area of safety and was issued with an annual Aerodrome License Renewal by the Namibia Civil Aviation Authority at the end of November 2019 and Walvis Bay International Airport has been re-licenced at the beginning of January 2020. The licensing process for Ondangwa Airport is currently underway and for Eros Airport, it is in the initial stages.

 

  1. The state of affairs at our Regional Airports: Rundu, Katima Mulilo, Ketmanshoop and Luderitz Airports are high on the Agenda of the board and various innovative initiatives are being investigated to address the compliance measures at those airports.

 

  1. The organization is aggressively preparing itself for the upcoming Safety Audit scheduled to take place this year at our flagship airport, Hosea Kutako International Airport.

 

  1. CAPITAL PROJECTS

 

  1. Let me highlight some of the key capital projects being implemented:

 

  1. “Hosea Kutako Congestion Alleviation Project” is expected to alleviate the congestion challenges in the terminal building and apron within the short term. Similarly, it is aimed at doubling the handling capacity of the airport to increased passenger movements up until 2030. The Government through the Ministry of Works and Transport have allotted funding amounting to N$155 million complemented by N$95 million from Namibia Airports company own coffers. The project is work in progress and is expected to be concluded by September 2020.

 

  1. Eros Airport Runway Rehabilitation project is aimed at rehabilitating the runway to enhance safety at the airport. The plans and designs for the holding action plan has been completed and submitted to the NCCA for approval. The project has been placed on a public bidding process which is due to close on 4 February 2020. The construction works is planned to be completed by end of May 2020.

 

  1. CHALLENGES

 

  1. Although we are proud to be associated with a couple of success stories, the organization still faces a number of challenges:

 

  1. Despite considerable efforts to regain our stakeholder’s confidence in the ability of our company, there are occasions where we still experience negativity/criticism and the organization has embarked upon an exercise to improve our corporate communication system and we would like to reassure our stakeholders of our continuous efforts to improve on service delivery;

 

  1.  Shortage of skills in the aviation sector still remains a concern, therefore significant investment is required for capacity development to ensure that we continue managing safe and secure airports in line with the applicable standards and regulations;

 

  1. The ageing infrastructure coupled with resources constraints impact the timeous execution of plans geared towards fulfilling our mandate;

 

  1. The payment of dues to the NAC by Lessees and Contracting parties remains a challenge and the organization is working tirelessly in close collaboration with our stakeholders to reduce the outstanding debts and to improve the financial position of the company. To this end, the Board has mandated Management to reassess all the company’s commercial agreements to ensure that it is in line with the reigning economic climate and if not to update these agreements; to terminate where circumstances so dictate; to renegotiate certain terms as and when necessary to ensure that the NAC is paid aptly for the services it is providing.  Management was also tasked to ensure that all outstanding dues are collected in the most cost effective, efficient and expeditious manner.

 

  1. The gloomy economic climate is contributing towards the effectiveness of execution of the NAC’s ability to deliver on its mandate. This is manifesting in the inability to attract more business opportunities as possible business partners also face economic difficulties.

 

  1. PERFORMANCE MILESTONES

 

Noting the road map going forward, the organization has prioritised the development of a five-year strategic plan as part of its deliverables. The process to formulate and develop the Integrated Strategic Business Plan is currently being done in- house. It is envisaged to have a strategic plan in place by the next financial year, 1 April 2020.

 

  1. CONCLUSION

 

In conclusion, over and above this briefing, we are pleased to inform you that the state of affairs at NAC has improved considerably and we acknowledge that there is still room for improvement.

 

We want to take the opportunity to thank the Shareholder, more specifically   the Ministries and the Ministers of Works and Transport and Public Enterprises, the Management team of the NAC, our Stakeholders and the entire NAC staff for their support and cooperation, for without this we, the NAC would not be able to fulfil its mandate and making the required impact.

 

Reid Hoffman said:

“No matter how brilliant your mind or strategy, if you’re playing a solo game, you’ll always lose out to a team.

 

We would like to reassure our Shareholder and stakeholders that we are committed in delivering world class customer service whilst maintaining safe and secure airports and we encourage you to support us in this quest for we are unable to do it alone!

 

I thank you!