OAG report reveals negligence at NPF
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The findings of the Office of Auditor General (OAG) have described the National Petroleum Fund (NPF) financial statements as ‘serious carelessness’.
In her report to the clerk of the National Assembly and Chairman of the Public Accounts Committee after compiling an audit recently, Auditor General, Pulane Letebele said, “In summation, the foregoing findings point to serious laxity in the management of the financial affairs of the Fund which permitted lack of clarity in relationships between the Fund and the various third party entities to be a regular feature of the business.”
“In my view, this situation persisted because the Management Committee of the Fund was largely dysfunctional and failed to provide guidance to the appointed Fund Managers as required by the Fund order,” she added. OAG was a few months ago tasked to review the administration, payments and the disbursement from NPF by a motion which was tabled in parliament. This followed a pending corruption case before the court involving Bakang Seretse, Botho Leburu and Kenneth Kerekang. The trio was alleged to have between September, 05, 2017 and November, 27, 2017 in Gaborone, illegally received the sum P250m from the NPF.
CARELESSNESS IN ILLEGAL APPOINTMENT OF KGORI
Documents by OAG leaked to this publication state that the appointment of Kgori Capital as the investment manager of the fund in 2015 was unlawful. “It was not in a manner that is prescribed by PPADB regulations,” states the document. The requirements for procurements of services and the choice of procurement method are covered by the PPADB regulations which states that: Floating of ITT, bid submitted, evaluated and awarded should be followed irrespective of the method of procurement used. The appointment according to the papers was confirmed in writing by the then director of the Department of Energy.
It is said that on signing, the former director indicated that he was duly authorized to execute the interim mandate, though the OAG did not obtain of him being authorized to do so. It is further the finding of the OAG that, in their financial proposal signed on October 8, 2015, Kgori Capital stated that the contract price had excluded capital raising fees (which had in any case not been part of the contract) and that they would be separately discussed with Ministry of Minerals Water and Energy Resources.
“Coincidentally on June 7, 2016, an officer of the Department of Energy wrote to Kgori Capital making an urgent request to provide a quotation to carryout financial transactional advisory services for raising fees. It is surprising that Kgori Capital mentioned capital raising fees even though they were never a part of the contract scope which suggests that at the time of submission of their financial proposal they had prior and privileged knowledge of the funding challenges of the three water supply projects and the need to source additional funding to complete the project, hence their statement on capital raising.” The fees for the provision of financial transactional advisory services amounted to over P2m.
CARELESSNESS IN MANAGEMENT COMMITTEE MEMBERS
The Fund order states that the Fund management committee shall include a representative of the Ministry of Finance and Development Planning who shall be a member. The OAG findings however, indicate no evidence that a representative from the same ministry was ever appointed to the committee. “Notwithstanding, the committee had not been functional. Minutes provided to audit showed that the committee met twice in two years,” states Letebele’s affidavit.
CARELESSNESS IN BANK ACCOUNTS
According to the documents, the Department of Energy signed a Small Scale Fund Agreement with the United Nations Environmental Programme (UNEP) for promotion of sulphur fuels. The Department of Energy had on March 2016 requested Kgori Capital to open an account into which an amount of over 83 000 USD would be transferred from UNEP. An amount of 51 000USD was already available for use at the time. However, OAG findings revealed observed that the account was not included in the financial statements of the Fund for the years ended March 31, 2016 and 2017.
On May 13, 2016, an amount of P60m was transferred from the Fund current account at Stanbic Bank to another Fund account at Bank Gaborone for the procurement of government strategic oil stock through Botswana Oil. “The account at Bank Gaborone is also not listed among the Fund banking accounts,” states Letebele in her report, adding that, “The omission of important matters such as bank accounts from financial statements is an indication that the affairs of the Fund were not properly managed in this respect.”
CARELESSNESS IN LEVY COLLECTIONS
Letebele has revealed that scrutiny of the records relating to levy receipts had indicated weakness in that there were no records supporting the amounts remitted by oil companies. She noted that, it was therefore not possible to ascertain that the monies credited to the Fund were the actual amounts due.
ENERGY MINISTRY DISOWNS KHULACO
Although it is not in dispute that the sum of P230m was transferred from the Fund account to Khulaco in 2017, Letebele’s report is that the ministry has denied knowledge of the said company. “On enquiry the accounting officer explained that the ministry did not have any relationship with Khulaco and was unknown to them.”
BACKGROUND
Eight years ago, the then Ministry of Minerals, Energy and Water Resources funded the construction of petroleum storage facilities around the country; and these were, and still are owned by the DIS. These were funded from the NPF. In August 2017, the DIS proposed that the ministry which has since been renamed Ministry of Mineral Resources; Green Technology and Energy Security releases an amount of P250m for the design and construction of additional sites in a bid to further expand these sites to cater for other essential government organs. The ministry promptly responded by acceding to the request and stipulated the funds within the NPF.
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The Fields Mall dragged to court over GCET Show
A legal battle between Interlink Communications (Proprietary) Limited and the newly built Fields Mall over the much anticipated technology show schedules for the 22nd of this month has begun.
Davies Tamali , the owner of Interlink Communication has filed papers before High Court Judge Dr Godfrey Radijeng where he seek an urgent interdiction of the Gaborone Consumer Electronics & Technology (GCET) show pending the final determination of the ownership of intellectual property rights over the event and damages based on misappropriation of intellectual property rights.
According to Tamali, GCET is the brainchild which was originally called “Tech Expo Botswana” as he ideated, conceptualised, organised and delivered the event details on behalf of Interlink Communications to the management of the fields Mall.
His papers further insist that the concept was introduced to the respondents through a proposal document sent by emails and Whatsapp on Monday the 8th of May 2023 as a request for venue usage and pricing.
According to Tamali, the respondents unlawfully and maliciously got hold of his proposal, took it unbeknown to him and presented themselves to the public, world at large to be the owners and original creators of the event.
“It is worth noting that the fields mall was actually the second venue center to be approached by the Applicants to host the event, with the first being Fairgrounds Holdings. The fact that the event can be hosted by other venues is a clear indication that the applicant is the owner of the event.”
Tamali pled with court to treat the application with urgency because by the time the action proceedings are heard in the ordinary course, the respondents would have finished planning his event and sharing his ideas even with other parties.
“On the basis of the conduct of the respondent, the matter is so urgent it cannot proceed in accordance with the normal Court processes given the times, as to so do will defeat the very purpose which is to preserve the status quo and to ensure that my rights are protected through a judicial process.”
CASE BACKGROUND
According to Tamali, the issue began after Davies had received the quotation costing from Fairgrounds Mall, which in essence he thought were beyond his pricing budget.
“This led to a request for quotation phone call on or about 7 May 2023 between the Tamali and Ayanda an employee of the fields who works under the supervision of the Nazly Dawood.”
Davies advised Ayanda that he was looking for a suitable venue to host a technology expo to be called “Tech Expo Botswana” which led to Ayanda asking what the expo was about. Following which Ayanda then advised that she would speak to her boss, Nazly about the event.
Tamali reveals that on the 8th May 2023, he followed up with Ayanda and she advised that she had not yet managed to speak to her boss.
He says that on the 15th of May 2023, he made another follow up and he was advised that Nazly wanted more details about the event so that she would be better placed to make a determination and final decision thereafter.
According to court papers, on the 17th of May 2023, Tamali followed up again and Ayanda advised that she had not yet managed to speak to her boss since last update, however she asked Tamali to call her later and when he called she advised that Nazly had asked for a detailed proposal so they can determine how to assist.
“It is common cause that on 17 May 2023 following the phone call with Ayanda, Tamali submitted a written proposal via email to the following email addresses; info@thefields.co.bw and nazla@thefields.co.bw using a link to Ayanda and Nazly requesting a quotation to use the Fields Mall as a venue for Tech Expo Botswana”
It is further revealed that on the 19th of May 2023, Tamali followed up with Ayanda and the Nazly. He was told that they were still discussing the issue hence they would get back to him.
“On 23 May 2023, Tamali sent a copy of the information pack to Ayanda on whatsapp. He then followed up with a phone call, upon which he was dismayed to hear Ayanda stated that they were also hosting a similar event called “Gaborone Consumer Electronics & Technology Show 2023” so they could not host his event.”
According to Ayanda, the started organizing the same event in May during the Gaborone Motor show.
“On or about 22 or 23 May 2023, I received a call from an individual who identified himself as Christian (The first respondent), who I now know to be the forefront of the current impeding GCET. He called me under the false pretense of being under the employ of fairgrounds holdings requesting information of how much I had paid for the fairgrounds venue”. Wrote Tamali.
He says that he advised him that the venue has not being paid yet, Christian then proceeded to ask why he advertised for an event that he has not yet paid for.
“I then explained to Christian that I had mentioned to his colleague Kesego that I would be advertising the event so that I get a general feel of how receptive the community was to such an event. I then asked Christian if he had spoken to Kesego, I must note that his demenour changed as he showed that he did not know Kesego at all. At that point I realised that Christian was not under the employ of Fairgrounds holding.”
Tamali reveals that after the phone call, he google searched and found that there was a show titled GCET Show 2023, and discovered that it was advertised on facebook using the date and his venue.