The Minister of Local Government and Rural Development, Slumber Tsogwane was this week hauled before the red-hot coals by his fellow Botswana Democratic Party (BDP) Members of Parliament over the faltering P1.6 billion Economic Stimulus Package (ESP) projects.
In addition the Legislators faulted Tsogwane, who is seen as one of Vice President, Mokgweetsi Masisi’s favorites’ on a number of goofs recorded under his nose by the Ministry. At some point Tsogwane’s name was mentioned along those who aspire to Vice President come April next year when Masisi takes over as President. But now his colleagues are questioning his delivery card. Where are the ESP projects you promised? They fired at a BDP caucus this week.
Unlike last week’s party caucus meeting whose primary objective was to shoot down an opposition Member of Parliament Dithapelo Keorapetse’s disciplined forces bill, this time around focus was primarily on constituency developments, and a number of MPs queried the apparent skewed development agenda. Of course, at the top of the agitated MPs’ wailings was the controversial Economic Stimulus Program (ESP). According to Weekendpost sources MP’s are demanding a report card of the program – some have boldly stated that the overhyped initiative has failed to live up to expectation and it safe to say it is a failed idea.
“It milked government millions if not billions of pula and it’s only appropriate to demand to know to what extent the initiative has stimulated the economy. You will find that some constituencies were promised a number of projects but two years down the line, there is nothing, we expected around 500 houses in Dukwi from the program, nothing!” said Nata-Gweta’s Polson Majaga. The ESP is reported to have pulled P1.6 billion from government coffers. When it was launched in Sefhare Ramokgonami constituency a number of areas were promised their share of the cake but most are yet to receive the goods.
“Though I can’t vividly remember which projects were allocated to which area, to be honest the ESP has fared below average, look at my constituency there is nothing, but initially I was promised a junior school in Ngware,” observed the BDP Chief, Whip Liekat Kablay. It is said Tsogwane was instructed by the party Chairman, Vice President Masisi, who was also leading the ESP idea to deliver the report card at the latest by next week. But his fellow MPs are of the view that he will still give them the ‘everyday rhetoric’. There is a view from within the party that the ESP was intended for cabinet ministers’ held constituencies and some “well-connected party arm chair activists”.
Kablay accused the government for focusing developments only in one direction. He said the northern constituencies are treated with kids’ gloves. “I can’t say the ministers’ areas are given priority but that’s what people are saying, look a hospital is being erected in Sefhare-Ramokgonami and there are other projects in Palapye, and a Police Station is also being built in Mochudi, but our constituencies are idle,” said Kablay. Still at the caucus meeting, BDP MPs would just not give Tsogwane a break, when thought he could take a breather, another issue emerged – the P10 million Constituency Funding.
This was widely criticized when it was first announced because it was viewed as yet another wild BDP political card. Legislators complain of lack of consultation on the initiative and they want the whole idea to be scrapped if not changed. “This is dubbed constituency fund, not council fund,” said Majaga before adding that “This money should be under our control because we are aware of the neither challenges in our constituencies, not the Village Development Committees (VDCs) nor Council. They cannot claim to know the constituency better than us, besides, we are their principals and we know the priorities. Look at the Nata-Gweta we were affected by Dineo floods and I could have prioritized accordingly more so that traffic was inconvenienced,” Majaga said.
Though the MP’s were given an opaque response as to whether they will get to control the P10 million, they told Tsogwane that they will fight for the proper channeling of the fund. “Maybe in the next financial year we would get the fund to be placed directly under MPs control, but for now there are no signs that this fund will placed with us. The next financial year is fast approaching and we hope to see action,” Kablay said. The complaints by the BDP MPs follow a number of protests from the opposition camps over the fund which were thrown out of the window.
In his own world, minister Tsogwane is said to have claimed that to the best of his knowledge the ESP projects were ongoing and everything was smooth. The Botswana government launched the Economic Stimulus Program (ESP) with the aim to boost the national economy. The ESP is a program that is meant to boost economic growth through increased government spending in identified sectors, diversify the economy and accelerate employment creation, said President Ian Khama at the launch ceremony in Machaneng village in eastern Botswana.
The Program was a response to the current unfavourable economic climate following the world economic recession of 2008/2009 which has resulted in job losses. "One of the major challenges in the economy is fall of commodity prices in the mining sector including diamonds," said Khama at the launch. "There is a need to diversify the economy even more so as to create sustainable jobs and to be able to cushion the economy against the international shocks of the mineral process," he said.
The program aimed at boosting the national economy through accelerated job creation and citizen empowerment using the Economic Diversification Drive (EDD) and harnessing the Special Economic Zones (SEZs) program for citizens, has been given national attention since its introduction by Botswana President Seretse Khama Ian Khama in last November. The caucus discussed other issues including the welfare of MPs. This coming Monday Parliament will amend the standing orders as per the request at last week’s caucus.
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.
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.