Botswana Federation of Public Sector Unions (BOFEPUSU) says it is keeping tabs on government’s intents to procure a helicopter for President Ian Khama’s private use in his retirement.
Khama is expected to stand down on the 1st of April 2018 when his term comes to an end. His deputy, Mokgweetsi Masisi will take over as head of state until the Botswana Democratic Party (BDP) convenes to elect its president. The federation’s labour secretary, Johnson Motshwarakgole told the press this week that government is entertaining designs to procure a helicopter for president Khama.
He described the claim as ‘very credible’ promising to disclose further details as time goes on. However, WeekendPost has established that government has amended the Presidents (Pensions and Retirement Benefits) bill of 2016 at least three times to insert multiple provisions and scrap some which will allow Khama to rendezvous with state helicopters and any other government mode of transport in his retirement.
Khama is believed to retain multiple homesteads dotted across multiple ends of the country. Some of his widely known homesteads include the Mosu resort in Central District while another one sits on an Island in the Okavango delta region. He is also an avid aviator who used to pilot state helicopters by himself.
The last of Khama’s retirement bills was published on the 12th of December 2016.This latest amendment deletes several sections to include pleasant provisions for Khama. The bill’s memorandum section states that “the bill is amended to grant a former President access to the use of any kind of any Government owned mode of transport, on a case by case basis, on such terms as may be determined by the President.” The amended bill also does not expressly state whether or not the president can pilot the aircraft himself but seems to leave that prospect open.
All along, a retired president was traditionally provided three cars. Section 6 of the president’s retirement bill provides that a former president is provided three cars: One is a sedan (Mercedes Benz or an equivalent or similar class of motor vehicle). Subsection two further states that the ex-statesman will also be provided one four wheel drive station wagon and one pick up van.
“The bill also states that these vehicles will be permanently at the disposal of the former president and will carry BX registration number plates unless otherwise decided by parliament.” it further states: “As with other Government motor vehicles, the vehicles will be replaced as and when necessary.” Government spokesperson, Dr. Jeff Ramsay feigned ignorance on the matter stating that he was out of town. “I am in Kasane. You can ask other people. I don’t know anything about that.”
BDP Secretary General Botsalo Ntuane also declined to comment. He only stated: “It’s not a BDP matter. Kindly ask OP [Office of the President].” In addition, the aim of the amendment was to outlaw and delete section 6(2) of the Presidents (Pensions and Retirement Benefits) Act which provides for the suspension of pension and benefits of a former head of state who has subsequently directly or indirectly held any paid office in the service of state or of any person.
It further states that “the deletion of section 6(2) means that if a former president directly or indirectly holds any paid office, any pension or benefits to which he is entitled under the Act shall continue to be paid.” Khama has in the past embarked that he intends to rejoin the Botswana Defence Force. His BDF stay was cut short by a request to abandon service to save the BDP in 1998.
Besides these two major amendments, a major amendment that was inserted to make conditions more salivating for Khama is the deletion of a section that outlawed the construction of a presidential palace out of the capital. The same change also made it possible for an ex-president “to receive a housing allowance in lieu of the house.”
The Act is intended to be so flexible that instead of a presidential palace and an office, a former statesman may choose to be given an office and residential allowance. Contrary to the current Act, the President’s house or office may be constructed outside Gaborone. It states that, “a retired President is given the option to choose between having an office, where he or she prefers, of the standard and size specified by the President or receiving office accommodation allowance using the prevailing Gaborone market rental rates.” In the old Act, there is also a new provision to construct palaces for former presidents outside the capital.
A further clause states: “A retired President is given the option to choose between having a residential house of the standard and size specified by the President or receiving a housing allowance in lieu of the house. A restriction to having the official residence in Gaborone has been removed.”
On the 2nd of April 2018, Khama will be entitled to a number of security officers to be determined by Masisi, two drivers, one private secretary, one secretary and one office attendant. He will also be entitled to office accommodation of the standard and size specified by Masisi in a location where Khama may prefer, or a monthly office accommodation allowance based on the prevailing Gaborone market rental rates. It includes a telephone, computer/word processor, office furniture and other office equipment as may be determined by Masisi.
He will be further entitled to a furnished residential house of the standard and size specified by Masisi, or a monthly housing allowance based on prevailing Gaborone market rental rates, two maids and one gardener. Furthermore, Khama (and his spouse) will also be entitled to state sponsored medical aid and will also be a beneficiary of first class air and rail travel within Botswana. First class air travel will also extend to international trips up to a maximum of 4 trips per annum (including a spouse if accompanying) and per diem for each trip as may be determined by Masisi.
He will also receive entertainment allowance determined by Masisi, telephone expenses as well as water and electricity expenses for the office and residence.
Mowana Copper Mine in Dukwi will finally pay its former employees a total amount of P23, 789, 984.00 end of this month. For over three years Mowana Copper Mine has been under judicial management. Updating members, Botswana Mine Workers Union (BMWU) Executive Secretary Kitso Phiri this week said the High Court issued an order for the implementation of the compromise scheme of December 9, 2021 and this was to be done within 30 days after court order.
“Therefore payment of benefits under the scheme including those owed to Messina Copper Botswana employees should be effected sometime in January latest end of January 2022,” Kitso said. Kitso also explained that cash settlement will be 30 percent of the total Messina Copper Botswana estate and negotiated estate is $3,233,000 (about P35, 563,000).
Messina Copper was placed under liquidation and was thereafter acquired by Leboam Holdings to operate Mowana Mine. Leboam Holdings struck a deal with the Messina Copper’s liquidator who became a shareholder of Leboam Holdings. Leboam Holdings could not service its debts and its creditors placed it under provisional judicial management on December 18, 2018 and in judicial management on February 28, 2019.
A new company Max Power expressed interest to acquire the mining operations. It offered to take over the Mowana Mine from Leboam Holdings, however, the company had to pay the debts of Leboam including monies owed to Messina Copper, being employees benefits and other debts owed to other creditors.
The monies, were agreed to be paid through a scheme of compromise proposed by Max Power, being a negotiated payment schedule, which was subject to the financial ability of the new owners. “On December 9, 2021, Messina Copper liquidator, called a meeting of creditors, which the BMWU on behalf of its members (former Messina Copper employees) attended, to seek mandate from creditors to proceed with a proposed settlement for Messina Copper on the scheme of compromise. It is important to note that employee benefits are regarded as preferential credit, meaning once a scheme is approved they are paid first.”
A savingram the Ministry of Local Government and Rural Development sent to Town Clerks and Council Secretaries explaining why councilors across the country should not have access to their terminal benefits before end of their term has been revealed.
The contents of the savingram came out in the wake of a war of words between counselors and the Ministry of Local Government and Rural Development. The councilors through the Botswana Association of Local Authorities (BALA) accuse the Ministry of refusing to allow them to have access to their terminal benefits before end of their term.
This has since been denied by the Ministry. In the savingram to town councils and council secretaries across the country, Permanent Secretary in the Ministry of Local Government and Rural Development Molefi Keaja states that, “Kindly be advised that the terminal benefits budget is made during the final year of term of office for Honorable Councilors.” Keaja reminded town clerks and council secretaries that, “The nominal budget Councils make each and every financial year is to cater for events where a Councilor’s term of office ends before the statutory time due to death, resignation or any other reason.”
The savingram also goes into detail about why the government had in the past allowed councilors to have access to their terminal benefits before the end of their term. “Regarding the special dispensation made in the 2014-2019, it should be noted that the advance was granted because at that time there was an approved budget for terminal benefits during the financial year,” explained Keaja. He added that, “Town Clerks/Council Secretaries made discretions depending on the liquidity position of Councils which attracted a lot of audit queries.”
Keaja also revealed that councils across the country were struggling financially and therefore if they were to grant councilors access to their terminal benefits, this could leave their in a dire financial situation. Given the fact that Local Authorities currently have cash flow problems and budgetary constraints, it is not advisable to grant terminal benefits advance as it would only serve to compound the liquidity problems of councils.
It is understood that the Ministry was inundated with calls from some Councils as they sought clarification regarding access to their terminal benefits. The Ministry fears that should councils pay out the terminal benefits this would affect their coffers as the government spends a lot on councilors salaries.
Reports show that apart from elected councilors, the government spends at least P6, 577, 746, 00 on nominated councilors across the country as their monthly salaries. Former Assistant Minister of Local Government and Rural Development, Botlogile Tshireletso once told Parliament that in total there are 113 nominated councilors and their salaries per a year add up to P78, 933,16.00. She added that their projected gratuity is P9, 866,646.00.
A surge in consumer spending is expected to be a key driver of Botswana’s economic recovery, according to recent projections by Fitch Solutions. Fitch Solutions said it forecasts household spending in Botswana to grow by a real rate of 5.9% in 2022.
The bullish Fitch Solutions noted that “This is a considerable deceleration from 9.4% growth estimated in 2021, it comes mainly from the base effects of the contraction of 2.5% recorded in 2020,” adding that, “We project total household spending (in real terms) to reach BWP59.9bn (USD8.8bn) in 2022, increasing from BWP56.5bn (USD8.3bn) in 2021.” According to Fitch Solutions, this is higher than the pre-Covid-19 total household spending (in real terms) of P53.0 billion (USD7.8bn) in 2019 and it indicates a full recovery in consumer spending.
“We forecast real household spending to grow by 5.9% in 2022, decelerating from the estimated growth of 9.4% in 2021. We note that the Covid-19 pandemic and the related restrictions on economic activity resulted in real household spending contracting by 2.5% in 2020, creating a lower base for spending to grow from in 2021 and 2022,” Fitch Solutions says.
Total household spending (in real terms), the agency says, will increase in 2022 when compared to 2021. In 2021 and 2022, total household spending (in real terms) will be above the pre-Covid-19 levels in 2019, indicating a full recovery in consumer spending, says Fitch Solutions. It says as of December 6 2021 (latest data available), 38.4% of people in Botswana have received at least one vaccine dose, while this is relatively low it is higher than Africa average of 11.3%.
“The emergence of new Covid-19 variants such as Omicron, which was first detected in the country in November 2021, poses a downside risk to our outlook for consumer spending, particularly as a large proportion of the country’s population is unvaccinated and this could result in stricter measures being implemented once again,” says Fitch Solutions.
Growth will ease in 2022, Fitch Solution says. “Our forecast for an improvement in consumer spending in Botswana in 2022 is in line with our Country Risk team’s forecast that the economy will grow by a real rate of 5.3% over 2022, from an estimated 12.5% growth in 2021 as the low base effects from 2020 dissipate,” it says.
Fitch Solutions notes that “Our Country Risk team expects private consumption to be the main driver of Botswana’s economic growth in 2022, as disposable incomes and the labour market continue to recover from the impacts of the Covid-19 pandemic.” It says Botswana’s tourism sector has been negatively impacted by the Covid-19 pandemic and the related travel restrictions.
According to Fitch Solutions, “The emergence of the Omicron variant, which was first detected in November 2021, has resulted in travel bans being implemented on Southern African countries such as South Africa, Botswana, Lesotho, Namibia, Zimbabwe and Eswatini. This will further delay the recovery of Botswana’s tourism sector in 2021 and early 2022.” Fitch Solutions, therefore, forecasts Botswana’s tourist arrivals to grow by 81.2% in 2022, from an estimated contraction of 40.3% in 2021.
It notes that the 72.4% contraction in 2020 has created a low base for tourist arrivals to grow from. “The rollout of vaccines in South Africa and its key source markets will aid the recovery of the tourism sector over the coming months and this bodes well for the employment and incomes of people employed in the hospitality industry, particularly restaurants and hotels as well as recreation and culture businesses,” the report says.
Fitch Solutions further notes that with economies reopening, consumers are demanding products that they had little access to over the previous year. However, manufacturers are facing several problems. It says supply chain issues and bottlenecks are resulting in consumer goods shortages, feeding through into supply-side inflation. Fitch Solutions believes the global semiconductor shortage will continue into 2022, putting the pressure on the supply of several consumer goods.
It says the spread of the Delta variant is upending factory production in Asia, disrupting shipping and posing more shocks to the world economy. Similarly, manufacturers are facing shortages of key components and higher raw materials costs, the report says adding that while this is somewhat restricted to consumer goods, there is a high risk that this feeds through into more consumer services over the 2022 year.
“Our global view for a notable recovery in consumer spending relies on the ability of authorities to vaccinate a large enough proportion of their populations and thereby experience a notable drop in Covid-19 infections and a decline in hospitalisation rates,” says Fitch Solutions. Both these factors, it says, will lead to governments gradually lifting restrictions, which will boost consumer confidence and retail sales.
“As of December 6 2021, 38.4% of people in Botswana have received at least one vaccine dose. While this is low, it is higher than the Africa average of 11.3%. The vaccines being administered in Botswana include Pfizer-BioNTech, Sinovac and Johnson & Johnson. We believe that a successful vaccine rollout will aid the country’s consumer spending recovery,” says Fitch Solutions. Therefore, the agency says, “Our forecasts account for risks that are highly likely to play out in 2022, including the easing of government support. However, if other risks start to play out, this may lead to forecast revisions.”