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Sadique, Tlhalerwa to answer for Energy ministry debts

Former minister of Mineral Resources, Green Technology & Energy Security; Sadique Kebonang and former President Ian Khama’s right hand man, Brigadier George Tlhalerwa have been subpoenaed to appear before High Court Judge Terrence Rannowane on June 5, in connection with the ministry’s debts.

The duo will testify on behalf of Oleaster (PTY) Ltd Director, Thembile Mhlauli who has dragged Kebonang’s former ministry before court demanding payment in the sum of P9 million for the construction of bulk strategic petroleum oil storages in Tshele Hills in 2016.

Oleaster’s case is that last year, the cabinet issued an instruction and Kebonang instructed that the case be removed from court and be settled amicably by paying him. Kebonang is said to have instructed that Oleaster be paid the amount owed in terms of their claim. “An acknowledgement to be paid was made by the cabinet instruction as well as the instruction of the Kebonang that the matter be settled out of court and that payment be made to us,” stated Oleaster in its court papers.

On March 8, 2018, Justice Rannowane made an order directing the parties to meet to explore possibility of an amicable settlement of the matter. “The Attorney General shall facilitate the attendance of all relevant personnel in order to have comprehensive settlement talks, especially the Minister Advocate Sadique Kebonang, the Permanent Secretary Dr. Obakeng, the Senior Private Secretary to the President Brigadier General Tlhalerwa, a senior representative of the Attorney General’s as well as the applicant’s representative,” ruled Rannowane who further stated that in the event negotiations collapse, the matter should be brought back before him.

Two weeks later, Oleaster Company wrote to the Attorney General threatening to take the matter back to the High Court as they were not interested in holding the meeting. “We note for your attention that the purpose of the said meeting was to assist the court in attaining a proper appreciation of the difficulty faced by the court especially paying attention to the averments made against and in relation to those therein mentioned high ranking officials who do not wish to be perceived as acting against government,” stated attorney David Moloise on behalf Oleaster.

“We do further reiterate that should this matter be taken to trial we shall subpoena those parties mentioned in the order together with all the pertinent Parliamentary Hansard as well as those other prominent members of the Cabinet who were present at the said deliberations, of which His Honour the Vice President was the chair, according to the minister’s advise before the Office of the President. We hold instructions to revert back to the high court with an urgent contempt application.”

It was then that, this week, Oleaster took the matter back to court and subpoenaed the witnesses. The background of the matter is that in April 2016, Oleaster entered into a sub-contract with a company known as BOWMAG Construction which was the main contractor. Oleaster relied on clause 6.6 of the said Sub-contract that it shall have the right to be paid directly by the employer. The sub-contractor commenced the work in full knowledge that the employer would make payment.

It is the sub-contractor’s averments that they used their own finances to push the project knowing that the government is usually slow in making payment and that payment would be made at any time. It is said that during November 2016, termination of the main contractor was done where immediately the sub-contractor began the process of seeking direct payment from the employer in terms of clause 4.4 (d) as read with 6.6 of the sub-contract. The court also heard that the sub-contractor was never paid but instead received excuse after excuse.

Minister Kebonang was subsequently approached whereupon he advised that it was in the interest of all parties that the matter be resolved as amicably as possible and with a view to avoiding legal action. Negotiations began whereupon senior government officials were involved from different ministries to the Office of the President.

It is said that Kebonang had stated that it was in the interest of completing the project that the sub-contractor be paid and the ministry proceed to appoint a new contractor to complete what was remaining at site. Vice-President Masisi also took the matter before the cabinet where it was agreed that the sub-contractor be paid for the work already done. However, the sub-contractor was never paid.

On March 7, 2018, Kebonang’s ministry wrote to the Director of Directorate of Intelligence and Security Services, Isaac Kgosi asking him to furnish them with a date as to when he will pay back the National Petroleum Fund (NPF) loot to help them (ministry) settle creditors.

In the savingram, Kebonang’s ministry wrote, “We refer to communication between us and Director General, Directorate of Intelligence and Security (DIS) relating to the question of refunding the NPF by DIS. The ministry is under tremendous pressure to settle several creditors, some of whom have gone to court in relation to Tshele Construction.

The Attorney General has since advised that there is a court order that requires the parties to meet and report to the court on or before Thursday 8 March, 2018.” “We will be grateful as to when the repayment by DIS would be credited to NPF. This will help us communicate definitive position with our creditors,” the Savingram further read. 

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13 AUGUST 2022 Publication

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DIS blasted for cruelty – UN report

26th July 2022
DIS BOSS: Magosi

Botswana has made improvements on preventing and ending arbitrary deprivation of liberty, but significant challenges remain in further developing and implementing a legal framework, the UN Working Group on Arbitrary Detention said at the end of a visit recently.

Head of the delegation, Elina Steinerte, appreciated the transparency of Botswana for opening her doors to them. Having had full and unimpeded access and visited 19 places of deprivation of liberty and confidentiality interviewing over 100 persons deprived of their liberty.

She mentioned “We commend Botswana for its openness in inviting the Working Group to conduct this visit which is the first visit of the Working Group to the Southern African region in over a decade. This is a further extension of the commitment to uphold international human rights obligations undertaken by Botswana through its ratification of international human rights treaties.”

Another good act Botswana has been praised for is the remission of sentences. Steinerte echoed that the Prisons Act grants remission of one third of the sentence to anyone who has been imprisoned for more than one month unless the person has been sentenced to life imprisonment or detained at the President’s Pleasure or if the remission would result in the discharge of any prisoner before serving a term of imprisonment of one month.

On the other side; The Group received testimonies about the police using excessive force, including beatings, electrocution, and suffocation of suspects to extract confessions. Of which when the suspects raised the matter with the magistrates, medical examinations would be ordered but often not carried out and the consideration of cases would proceed.

“The Group recall that any such treatment may amount to torture and ill-treatment absolutely prohibited in international law and also lead to arbitrary detention. Judicial authorities must ensure that the Government has met its obligation of demonstrating that confessions were given without coercion, including through any direct or indirect physical or undue psychological pressure. Judges should consider inadmissible any statement obtained through torture or ill-treatment and should order prompt and effective investigations into such allegations,” said Steinerte.

One of the group’s main concern was the DIS held suspects for over 48 hours for interviews. Established under the Intelligence and Security Service Act, the Directorate of Intelligence and Security (DIS) has powers to arrest with or without a warrant.

The group said the “DIS usually requests individuals to come in for an interview and has no powers to detain anyone beyond 48 hours; any overnight detention would take place in regular police stations.”

The Group was able to visit the DIS facilities in Sebele and received numerous testimonies from persons who have been taken there for interviewing, making it evident that individuals can be detained in the facility even if the detention does not last more than few hours.

Moreover, while arrest without a warrant is permissible only when there is a reasonable suspicion of a crime being committed, the evidence received indicates that arrests without a warrant are a rule rather than an exception, in contravention to article 9 of the Covenant.

Even short periods of detention constitute deprivation of liberty when a person is not free to leave at will and in all those instances when safeguards against arbitrary detention are violated, also such short periods may amount to arbitrary deprivation of liberty.

The group also learned of instances when persons were taken to DIS for interviewing without being given the possibility to notify their next of kin and that while individuals are allowed to consult their lawyers prior to being interviewed, lawyers are not allowed to be present during the interviews.

The UN Working Group on Arbitrary Detention mentioned they will continue engaging in the constructive dialogue with the Government of Botswana over the following months while they determine their final conclusions in relation to the country visit.

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Stan Chart halts civil servants property loan facility

26th July 2022
Stan-Chart

Standard Chartered Bank Botswana (SCBB) has informed the government that it will not be accepting new loan applications for the Government Employees Motor Vehicle and Residential Property Advance Scheme (GEMVAS and LAMVAS) facility.

This emerges in a correspondence between Acting Permanent Secretary in the Ministry of Finance Boniface Mphetlhe and some government departments. In a letter he wrote recently to government departments informing them of the decision, Mphetlhe indicated that the Ministry received a request from the Bank to consider reviewing GEMVAS and LAMVAS agreement.

He said: “In summary SCBB requested the following; Government should consider reviewing GEMVAS and LAMVAS interest rate from prime plus 0.5% to prime plus 2%.” The Bank indicated that the review should be both for existing GEMVAS and LAMVAS clients and potential customers going forward.

Mphetlhe said the Bank informed the Ministry that the current GEMVAS and LAMVAS interest rate structure results into them making losses, “as the cost of loa disbursements is higher that their end collections.”

He said it also requested that the loan tenure for the residential property loans to be increased from 20 to 25 years and the loan tenure for new motor vehicles loans to be increased from 60 months to 72 months.

Mphetlhe indicated that the Bank’s request has been duly forwarded to the Directorate of Public Service Management for consideration, since GEMVAS and LAMVAS is a Condition of Service Scheme. He saidthe Bank did also inform the Ministry that if the matter is not resolved by the 6th June, 2022, they would cease receipt of new GEMVAS and LAMVAS loan applications.

“A follow up virtual meeting was held to discuss their resolution and SCB did confirm that they will not be accepting any new loans from GEMVAS and LAMVAS. The decision includes top-up advances,” said Mphetlhe. He advised civil servants to consider applying for loans from other banks.

In a letter addressed to the Ministry, SCBB Chief Executive Officer Mpho Masupe informed theministry that, “Reference is made to your letter dated 18th March 2022 wherein the Ministry had indicated that feedback to our proposal on the above subject is being sought.”

In thesame letter dated 10 May 2022, Masupe stated that the Bank was requesting for an update on the Ministry’s engagements with the relevant stakeholder (Directorate of Public Service Management) and provide an indicative timeline for conclusion.

He said the “SCBB informs the Ministry of its intention to cease issuance of new loans to applicants from 6th June 2022 in absence of any feedback on the matter and closure of the discussions between the two parties.”  Previously, Masupe had also had requested the Ministry to consider a review of clause 3 of the agreement which speaks to the interest rate charged on the facilities.

Masupe indicated in the letter dated 21 December 2021 that although all the Banks in the market had signed a similar agreement, subject to amendments that each may have requested. “We would like to suggest that our review be considered individually as opposed to being an industry position as we are cognisant of the requirements of section 25 of the Competition Act of 2018 which discourages fixing of pricing set for consumers,” he said.

He added that,“In this way,clients would still have the opportunity to shop around for more favourable pricing and the other Banks, may if they wish to, similarly, individually approach your office for a review of their pricing to the extent that they deem suitable for their respective organisations.”

Masupe also stated that: “On the issue of our request for the revision of the Interest Rate, we kindly request for an increase from the current rate of prime plus 0.5% to prime plus 2%, with no other increases during the loan period.” The Bank CEO said the rationale for the request to review pricing is due to the current construct of the GEMVAS scheme which is currently structured in a way that is resulting in the Bank making a loss.

“The greater part of the GEMVAS portfolio is the mortgage boo which constitutes 40% of the Bank’s total mortgage portfolio,” said Masupe. He saidthe losses that the Bank is incurring are as a result of the legacy pricing of prime plus 0% as the 1995 agreement which a slight increase in the August 2018 agreement to prime plus 0.5%.

“With this pricing, the GEMVAS portfolio has not been profitable to the Bank, causing distress and impeding its ability to continue to support government employees to buy houses and cars. The portfolio is currently priced at 5.25%,” he said.  Masupe said the performance of both the GEMVAS home loan and auto loan portfolios in terms of profitability have become unsustainable for the Bank.

Healso said, when the agreement was signed in August 2018, the prime lending rate was 6.75% which made the pricing in effect at the time sufficient from a profitable perspective. “It has since dropped by a total 1.5%. The funds that are loaned to customers are sourced at a high rate, which now leaves the Bank with marginal profits on the portfolio before factoring in other operational expenses associated with administration of the scheme and after sales care of the portfolio,” said the CEO.

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