Back to the 90s: Namibia’s payroll deduction de-digitisation

For over two decades, the Namibian government quietly stood as a continental leader in payroll-related financial technology. Through its Payroll Deduction Management System (PDMS), the government adopted a sophisticated, fully automated interface that linked the government payroll system directly to banks and insurers in real time. It was a system built for the future: integrated, transparent, and designed to protect more than 100 000 government employees from the pitfalls of over-indebtedness.

However, in a move that has left industry experts and civil servants dumbfounded and searching for answers, the digital infrastructure has been dismantled.

In its place, Namibia has introduced a concept rarely seen in modern governance: de-digitisation.

The transition from a seamless digital platform to what is effectively a 1990s-era call centre marks a significant shift in Namibia's technological trajectory. In January 2026, the Ministry of Finance confirmed that no digital replacement system was ready to take over the functions of the now-defunct PDMS.

Instead, the solution presented to the public is a PDMS Helpdesk.

A manual operation relying on mobile phones and human discretion to manage the complex financial enquiries of over 100 000 civil servants.

This is not merely a process change; it is a fundamental step backwards in service delivery. Where automated rules once protected employees instantly, there is now "manual guesswork" and a high potential for administrative and human error. It also doesn't fit in with Namibia's drive and determination to become an ICT powerhouse in Southern Africa by 2030.

A timeline of "policy firefighting"

The erosion of this digital standard did not happen overnight, but the process has been characterised by what many describe as "policy firefighting".

August 2025: The ministry abruptly announced the discontinuation of payroll deduction codes with no prior stakeholder consultation.

The Reaction: Industry leaders, unions, and employees voiced immediate concern over the chaos that would follow.

October 2025: Facing legal challenges and public pressure, the Ministry of Finance extended the engagement period but confirmed the digital system would be brought in-house without a clear roadmap for continuity.

January 2026: The final admission arrived – there was no new automated platform, only the call centre.

This reactive, almost knee-jerk approach suggests that the current outcome was not a deliberate design but rather a result of mounting external pressure following the lack of initial consultation.

The stakes for service delivery

The impact of this shift now falls squarely on Namibia's civil servants. The dismantling of a functioning digital system removes the very controls that once managed financial risk. These were in place for a reason.  For the 100 000 employees affected, the results are likely to be:

Slower Processing Times: Replacing real-time automation with manual enquiries will inevitably lead to delays.

Reduced Transparency: Manual discretion lacks the audit trail and consistency of an automated system.

Increased Costs: The financial sector has already warned that these manual processes will lead to higher costs and reduced access to credit for low-income workers. Not to mention extra employees, offices, and so forth.

In essence, the risk of employee indebtedness persists, but the sophisticated tools used to manage it have been discarded.

A confusing signal to global investors

Apart from the administrative concerns, this move sends a troubling message to the international community. Namibia is currently on the cusp of a transformative era, particularly with the development of its oil and gas sector.

Attracting the billions in investment required for such projects depends on a reputation for stability, predictability, and coherent policy. As well as sophisticated, streamlined financial systems.

When established systems are dismantled without replacements and policy directions shift repeatedly under pressure, global investors take note. Namibia cannot afford to be viewed as a "de-digitised economy" that reverts to outdated tools when modern solutions are readily available.

A call for course correction

The recent replacement of the executive director at the Ministry of Finance, presiding over this matter, offers a potential turning point. The question now is whether the new leadership will double down on this path of de-digitisation or recognise that a modern Namibia requires modern tools.

Policy is meant to serve the people. Right now, the silence regarding a long-term digital solution is proving costly to the country's credibility and the financial well-being of its workforce. For Namibia to thrive, it must look toward the digital horizon, not back to the call centres of the past.

*Mefflint de Waal is a senior accounting and financial advisor.