Public servants may lose P500 million
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The case between Botswana Public Officers’ Pension Fund (BPOPF) and Capital Management Botswana (CMB) has now taken a legal turn, with BPOPF dragging CMB before the court of law. The case was before the Gaborone High Court on Friday and it is likely to be a marathon case.
At the centre of the case are attempts by the BPOPF to recover P477 million from CMB in the form of assets and cash. It is arguing that the investments made are not in tandem with the agreed investment policy. The most recognized local face behind CMB is Rapula Okaile and he has partnered with South African businessmen. CMB is determined to fight off suggestions by the BPOPF, if the case does not go in the latter’s favour, public servants will be the biggest losers.
But CMB has forced BPOPF to start arguing preliminary matters first. In the active case, the applicant BPOPF is seeking a verdict that they be determined the rightful party to terminate contract with CMB and take over the assets. And on the other hand CMB contends that they are the right party to terminate the contract, not the other way round. This followed an exchange of letters of termination of contract between the two parties a month ago.
BPOPF had three weeks ago written to CMB terminating their contract for persistent breach of the obligation in managing and handling of the funds which they labeled as negligent and an act of misconduct by CMB. They also summoned CMB to return all documentation and assets. In response to this, CMB wrote back to BPOPF a week later that they were actually the ones terminating the contract. Their reason was that BPOPF did not honor the Drawdown notice of Lobatse Clay Works. CMB then deposited P50 million into BPOPF account citing it was net cash. And BPOPF argument was that the money was short of P420 million.
Should the court grant BPOPF the verdict, BPOPF will then get hold of the records from CMB; get the assets back which are at Bona Life, Wilderness Holdings and Cell City; do the audit and get to see the valuation of the record as they are of the view that CMB has misused the funds. BPOPF is also questioning the assets which CMB says they have invested with three other companies namely Kawena, Makuba Airlines and Ajine University. BPOPF says it is not even sure of the existence of the said companies. Kawena was supposed to be a chain of stores competing with Choppies stores according to the records. In the case CMB wins the case, BPOPF will then get nothing from CMB.
The background of the case is that BPOPF entered into an agreement (Advisory and Management Services Agreement 9AMSA) with CMB as the fund of P500 million on 3rd November, 2014. BPOPF at the time committed P500 million. Two years later, BPOPF questioned the way CMB was handling the funds, accusing it of breach of the investment policy. It was then that BPOPF terminated the contract on 30 October, 201, leading to the case before court today. BPOPF also wants all documentation relating to the Fund and to each of the Fund's Investments that are in its possession and which ought to be within its possession in terms of the Partnership Agreement both as its General Partner and Fund Manager.
MOLEFHE HAD SEEN THE SMOKING GUN
This publication learned that when Boitumelo Molefhe joined BPOPF in July 2015 she expressed concern that there were so many loopholes in some of the contracts BPOPF had entered into. She is said to have written to the Board in August 2016 making members aware of the anomalies and the need to take action but she was not successful. Molefhe is said to have asked for a proper valuation of CMB.
Weekend Post is informed that at the time, CMB had only invested in Bona Life. Unfortunately indications are that Molefhe was in her own world as many board members discouraged her from going ahead with the valuation. Board members were convinced that everything looked well and urged Molefhe to let sleeping dogs lie. Sources point out that some went to the extent of scaring Molefhe by telling her that she was putting her position at risk.
“She demanded that her advice be put in writing as a record that she once demanded that this be done but the board was not willing to do so,” said a source close to the developments. At some point Molefhe was accused of being trigger happy because every season she was firing one of the Fund managers. Molefhe is said to have insisted that the board must be vigilant because it was dealing with public money which has to be accounted for. “It is only until recently that she decided to take the bull by its horns and fight this issue of CMB,” said the source.
“People should understand that these are public funds, it is not somebody’s kitchen where they can do as it pleases them,” said a concerned citizen close to the BPOPF on goings. There was an initial back and forth on the subject of whether to terminate CMB or not. But common sense prevailed and the termination was agreed. On the issue of taking the matter to court the Board unanimously agreed. A total of P477m was invested in all the six disputed companies and BPOPF wants it returned. BPOPF is represented by Werkmans Attorneys through the local law firm Minchin and Kelly.
A STAND OUT BREACH
BPOPF is taking a strong exception of the breach of the Provisions Relating to Fund Expenses. It notes that Fund Expenses should be reasonably incurred and duly evidenced and should expressly exclude any placement agent fees. It is said that on 3 March 2016, the General Partner drew down an amount of P12,500,000 representing 2.5% of the Total Commitment which BPOPF understood were in respect of Fund Expenses and Organisational Fees. The Drawdown Notice breached the provisions of the Partnership Agreement by not setting out the allocation to each item.
Fund Expenses must be actually incurred by the General Partner before they are reimbursed. No evidence was provided with the drawdown that such fees were indeed incurred. BPOPF notes that there are caps of 0.25% on each of Fund Expenses and Organisational Fees. It Its concern is that this covers the entire term of the Fund. The capped amount was therefore P2,500,000 over the life of the Fund. Beyond that amount, any expenses of the Fund are to be borne by CMB. The amount drawn down exceeds the capped fees by P10,000,000.
The drawdown was also supposed to cover Management Fees. These are not separately enumerated in the notice but it is noted that the amount of P10,000,000 represents 2% of the Total Commitment whereas the Fund Manager was entitled to 1.5% as a fee. The difference cannot be explained by the reference to cash reserves .
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ENVIRONMENT ISSUES: Masisi asks Virginia for help
President Mokgweetsi Masisi says the issue of sustainable natural resources management has always been an important part of Botswana’s national development agenda.
Masisi was speaking this week on the occasion of a public lecture at Virginia Polytechnic, under theme, “Merging Conservation, Democracy and Sustainable Development in Botswana.”
Botswana, according to Masisi, holds the view that the environment is fragile and as such, must be managed and given the utmost protection to enable the achievement of Sustainable Development Goals (SDGs).
“It is necessary that we engage one another in the interchange of ideas, perspectives, visualizations of social futures, and considerations of possible strategies and courses of action for sustainable development,” said Masisi.
On the other hand, dialogue, in the form of rigorous democratic discourse among stakeholders presents another basis for reconfiguring how people act on their environments, with a view to conserving its resources that “we require to meet our socio-economic development needs on a sustainable basis,” Masisi told attendees at the public lecture.
He said government has a keen interest in understanding the epidemiology and ecology of diseases of both domestic and wild animals. “It is our national interest to forestall the dire consequences of animal diseases on our communities livelihoods.”
President Masisi hoped that both Botswana and Virginia could help each other in curbing contagious diseases of wildlife.
“We believe that Virginia Tech can reasonably share their experiences, research insights and advances in veterinary sciences and medicines, to help us build capacity for knowledge creation and improve efforts of managing and containing contagious diseases of wildlife. The ground is fertile for entering into such a mutually beneficial partnership.”
When explaining environmental issues further, Masisi said efforts of conservation and sustainable development might at times be hampered by the emergence and recurrence of diseases when pathogens mutate and take host of more than one species.
“Water pollution also kills aquatic life, such as fish, which is one of humanity’s much deserved sources of food. In this regard, One Health Approach imposes ecological responsibility upon all of us to care for the environment and the bio-diversity therein.”
He said the production and use of animal vaccines is an important space and tool for conservation, particularly to deal with trans-border animal diseases.
“In Botswana, our 43-year-old national premier pharmaceutical institution called Botswana Vaccine Institute has played its role well. Through its successful production of highly efficacious Foot and Mouth vaccines, the country is able to contain this disease as well as supply vaccines to other countries in the sub-region.:
He has however declared that there is need for more help, saying “We need more capacitation to deal with and contain other types of microbial that affect both animals and human health.”
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Masisi saddened by deaths of elephant attacks
President Mokgweetsi Masisi has expressed a strong worry over elephants killing people in Botswana. When speaking in Virginia this week, Masisi said it is unfortunate that Batswana have paid a price with their own blood through being attacked by elephants.
“Communities also suffer unimaginable economic losses yearly when their crops are eaten by the elephants. In spite of such incidents of human-elephant conflict, our people embrace living together with the animals. They fully understand wildlife conservation and its economic benefits in tourism.”
In 2018, Nthobogang Samokwase’s father was attacked by an elephant when travelling from the fields, where he stayed during the cropping season.
It was reported that the man couldn’t run because of his age. He was found trampled by the elephant and was pronounced dead upon arrival at the hospital.
In the same year, in Maun, a 57-year-old British woman was attacked by an elephant at Boro and died upon arrival at the hospital. The woman was with her Motswana partner, and were walking dogs in the evening.
Last month, a Durban woman named Carly Marshall survived an elephant attack while on holiday in the bush in Botswana. She was stabbed by one of the elephant’s tucks through the chest and was left with bruises. Marshall also suffered several fractured ribs from the ordeal.
President Masisi Botswana has the largest population of African elephants in the world, totaling more than 130 000. “This has been possible due to progressive conservation policies, partnerships with the communities, and investment in wildlife management programmes.”
In order to benefit further from wildlife, Masisi indicated that government has re-introduced controlled hunting in 2019 after a four-year pause. “The re-introduction of hunting was done in an open, transparent and democratic way, giving the communities an opportunity to air their views. The funds from the sale of hunting quota goes towards community development and elephant conservation.”
He stressed that for conservation to succeed, the local people must be involved and derive benefits from the natural resources within their localities.
“There must be open and transparent consultations which involve all sectors of the society. It is against this backdrop that as a country, we lead the continent on merging conservation, democracy and sustainable development.”
Masisi stated that Botswana is open to collaborative opportunities, “particularly with identifiable partners such as Virginia Tech, in other essential areas such as conservation, and the study of the interplay among the ecology of diseases of wild animals and plants, and their effects on human health and socio-economic development.”
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Gov’t commit to injecting more funds in fighting HIV
Minister for State President Kabo Morwaeng says government will continue to make resources available in terms of financial allocations and human capital to ensure that Botswana achieves the ideal of eradicating HIV and AIDS as a public health threat by 2030.
Morwaeng was speaking this morning in Gaborone at the High-Level Advocacy event to accelerate HIV Prevention in Botswana. He said the National AIDS and Health Promotion Agency (NAPHA), in partnership with UNAIDS, UN agencies, the Global Fund and PEPFAR, have started a process of developing transition readiness plan for sustainability of HIV prevention and treatment programmes.
“It is important for us, as a country that has had a fair share of donor support in the response to an epidemic such as HIV and AIDS, to look beyond the period when the level of assistance would have reduced, or ceased, thus calling for domestic financing for all areas which were on donor support.”
Morwaeng said this is important as the such a plan will guarantee that all the gains accrued from the response with donor support will be sustained until the end when “we reach the elimination of HIV and AIDS as a public health threat by 20230,” he said.
“I commit to continue support efforts towards strengthened HIV prevention, accentuating HIV primary prevention and treatment as prevention towards Zero New Infections, Zero Stigma, Discrimination and Zero AIDS related death, to end AIDS in Botswana.”
He reiterated that government commits to tackle legislative, policy and programming challenges that act as barriers to the achievement of the goal of ending AIDS as a public health threat.
In the financial year 2022/2023, a total of 119 Civil Society Organizations, including Faith Based Organizations, were contracted with an amount of P100 million to implement HIV and NCDs prevention activities throughout the country, and the money was drawn from the Consolidated Fund.
Through an upcoming HIV Prevention Symposium, technical stakeholders will use outcomes to develop the Botswana HIV Prevention Acceleration Road Map for 2023-2025.
Morwaeng stated that government will support and ensure that Botswana plays its part achieving the road map. He said there is need to put hands on the deck to ensure that Botswana sustains progress made so far in the fight against HIV and AIDS.
“There are tremendous achievements thus far to, reach and surpass the UNAIDS fast track targets of 95%- 95%- 95% by the year 2025. As reflected by the BAIS preliminary results of 2021, we now stand at 95- 98- 98 against the set targets.”
“These achievements challenge us to now shift our gears and strive to know who are the remaining 5% for those aware of their HIV status, 2% of enrolment on treatment by those aware of their status and 2% of viral suppression by those on treatment.”
Explaining this further, Morwaeng said shift in gears should extend to coming up with robust strategies of determining where these remaining people are as well as how they will be reached with the necessary services.
“These are just some of the many variables that are required to ensure that as a country, we are well positioned to reaching the last mile of our country’s response to the HIV and AIDS pandemic.”