Botswana should anticipate the proliferation of new superrich oligarchs as a season of privatising state enterprises looks set to continue beyond Air Botswana.
In an all-round futuristic attitude, the Minister for Transport and Communications; Kitso Mokaila, told the press this Thursday that they might consider privatizing Botswana Railways as a way of shaking off loss making parastatals. Mokaila stated that his desire is to see independent parastatals that generate own income instead of gobbling state funds. He mentioned that in communicating to the Botswana Railways board of directors, he advised them to maintain an open minded line towards privatization of the train company.
“When I wrote to the board, I said to them that if it is possible we should privatize Botswana Railways so that we break new grounds and start transporting goods into West, Central and East Africa.” When probed further, Mokaila stated that he cannot say for certain at the moment whether they will privatize BR stating that they intend to conduct a research beforehand.
Mokaila further said that one of the aspects that will ease his ideal of continental trade is the construction of Kazungula Bridge which is both road and rail in kind. He said that his ministry intends to adopt a forward sighted approach “to see if a train will not pass through the wildlife area of Kasane as we export into Central Africa since there are wildlife issues of migration routes.”
He further revealed that when construction is complete, the Kazungula corridor will service 800 vehicles daily as compared to the 200 that are able to flow into and out of Zambia daily. Deputy Permanent Secretary for Transport in Mokaila’s ministry, Isaac Moepeng, also denied that the country’s South-North railway has reached its end life. The rail line has been washed away by rains numerous times in the recent past, derailing and running trains aground. Mokaila revealed that the recent damage to BR resultant of derailed trains cost government a staggering figure of P 8 million.
Moepeng, however revealed that, with Chinese assistance, in 1985 BR overhauled the then 40 kilogram per meter section of the railway to 50 kilogram per meter upraised on concrete sleepers. He further noted that this meant that government can now move more tonnages of goods on the tracks revealing that the railway still has 32 years of life left in it. Moepeng stated that, in fact, BR is underutilising the railway as they move 2 million tons of goods per annum on a railway that has the aptitude to haul up to 4 million tons.
Regarding Air Botswana, Mokaila conceded that the national carrier had been troubled citing among other reasons, the country’s population and unprofitable routes. He also revealed that his ministry has so far received 17 expressions of interest to take up 52% of the national carrier’s stake. He however declined to name the individuals and companies that stepped up only stating that due process is still underway. He further revealed that they have roped in the services of International Air Transport Association (IATA) to assess the 17 expression of interest for viability, “to look for the best model, avoid job losses and come up with a good airline.”
He also said that the dire situation at the carrier is evident as can be seen with the downscaling of aircrafts from formerly 8 to the current 4. Mokaila also acknowledged that the carrier’s pilots are leaving en masse for better prospects elsewhere, stating that: “I am happy when they leave because they get better opportunities.” Moepeng, for his part, revealed that out of the airliner’s 40 pilots, “10 have left and some are still going.”
Some of the state enterprises that were privatized and offloaded in recent memory include Botswana Telecommunications Corporation (BTC), Water Affairs as well as Bamangwato Concessions Limited (BCL). Air Botswana now joins Botswana Meat Commission (BMC) on the ranks of state companies awaiting privatization while BR could follow soon.
Quantum of Damages
Mokaila, under whose ministry falls the Department of Roads stated that his ministry will compile an assessment of the country’s damaged road network and then make presentations to cabinet. He further stated that the assessment will determine the quantum of the damages which will advise him when he requests funding from cabinet. “There has been road damage after the recent rains while other roads were in a bad state long before the recent rains. Some will need maintenance while some will need rebuilding.”
He further continued to state: “We haven’t measured the cost of damages caused by the rains. After we do that I will go to cabinet to present what I have and how much we need. I will then go to parliament and ask for money because these damages were not budgeted under the NDP 11.” Mokaila also stated that while the Department of Roads has the equipment such as road graders the department seems to be bogged down. He said that to untangle this conundrum, the roads department will look to private contractors to assist them.
“Re bobotlana rele lephata, we have graders but we are not fast,” stated Mokaila. Among some of the shambolic roads he counted include the Mogobane-Lobatse road which he personally inspected, Gaborone-Lobatse road, Francistown-Nata road as well as the Nata-Maun road.
Mokaila also promised to mount a spirited fight against network providers for inflating costs in his ‘national agenda’. “We want to see to it that prices go down. As a national agenda you should decide whether you want to protect big business or you will see to it that you want prices to go down.You shouldn’t be shy about it. You shouldn’t beat about the bush, if we do that we will lag behind. Don’t ask me how,” Mokaila said as he parried off questions from the press.
Government is currently sitting on 4 400 vacant posts that remain unfilled in the civil service. This is notwithstanding the high unemployment rate in Botswana which has been exacerbated by the recent outbreak of the deadly COVID-19 pandemic.
Just before the burst of COVID-19, official data released by Statistics Botswana in January 2020, indicate that unemployment in Botswana has increased from 17.6 percent three years ago to 20.7 percent. “Unemployment rate went up by 3.1 percentage between the two periods, from 17.6 to 20.7 percent,” statistics point out.
Leading commercial bank, First National Bank Botswana (FNBB), expects the central bank to sharpen its monetary policy knife and cut the Bank Rate twice in the last quarter of 2020.
The bank expects a 25 basis point (bps) in the beginning of the last quarter, which is next month, and another shed by the same bps in December, making a total of 50 bps cut in the last quarter. According to the bank’s researchers, the central bank is now holding on to 4.25 percent for the time being pending for more informed data on the economic climate.
An audit of the accounts and records for the supply of food rations to the institutions in the Northern Region for the financial year-ended 31 March 2019 was carried out. According to Auditor General’s report and observations, there are weaknesses and shortcomings that were somehow addressed to the Accounting Officer for comments.
Auditor General, Pulane Letebele indicated on the report that, across all depots in the region that there had been instances where food items were short for periods ranging from 1 to 7 months in the institutions for a variety of reasons, including absence of regular contracts and supplier failures. The success of this programme is dependent on regular and reliable availability of the supplies to achieve its objective, the report said.
There would be instances where food items were returned from the feeding centers to the depots for reasons of spoilage or any other cause. In these cases, instances had been noted where these returns were not supported by any documentation, which could lead to these items being lost without trace.
The report further stressed that large quantities of various food items valued at over P772 thousand from different depots were damaged by rodents, and written off.Included in the write off were 13 538 (340ml) cartons of milk valued at P75 745. In this connection, the Auditor General says it is important that the warehouses be maintained to a standard where they would not be infested by rodents and other pests.
Still in the Northern region, the report noted that there is an outstanding matter relating to the supply of stewed steak (283×3.1kg cans) to the Maun depot which was allegedly defective. The steak had been supplied by Botswana Meat Commission to the depot in November 2016.
In March 2017 part of the consignment was reported to the supplier as defective, and was to be replaced. Even as there was no agreement reached between the parties regarding replacement, in 51 October 2018 the items in question were disposed of by destruction. This disposal represented a loss as the whole consignment had been paid for, according to the report.
“In my view, the loss resulted directly from failure by the depot managers to deal with the matter immediately upon receipt of the consignment and detection of the defects. Audit inspections during visits to Selibe Phikwe, Maun, Shakawe, Ghanzi and Francistown depots had raised a number of observations on points of detail related to the maintenance of records, reconciliations of stocks and related matters, which I drew to the attention of the Accounting Officer for comments,” Letebele said in her report.
In the Southern region, a scrutiny of the records for the control of stocks of food items in the Southern Region had indicated intermittent shortages of the various items, principally Tsabana, Malutu, Sunflower Oil and Milk which was mainly due to absence of subsisting contracts for the supply of these items.
“The contract for the supply of Tsabana to all depots expired in September 2018 and was not replaced by a substantive contract. The supplier contracts for these stocks should be so managed that the expiry of one contract is immediately followed by the commencement of the next.”
Suppliers who had been contracted to supply foodstuffs had failed to do so and no timely action had been taken to redress the situation to ensure continuity of supply of the food items, the report noted.
In one case, the report highlighted that the supplier was to manufacture and supply 1 136 metric tonnes of Malutu for a 4-months period from March 2019 to June 2019, but had been unable to honour the obligation. The situation was relieved by inter-depot transfers, at additional cost in transportation and subsistence expenses.
In another case, the contract was for the supply of Sunflower Oil to Mabutsane, where the supplier had also failed to deliver. Examination of the Molepolole depot Food Issues Register had indicated a number of instances where food items consigned to the various feeding centres had been returned for a variety of reasons, including food item available; no storage space; and in other cases the whole consignments were returned, and reasons not stated.
This is an indication of lack of proper management and monitoring of the affairs of the depot, which could result in losses from frequent movements of the food items concerned.The maintenance of accounting records in the region, typically in Letlhakeng, Tsabong, and Mabutsane was less than satisfactory, according to Auditor General’s report.
In these depots a number of instances had been noted where receipts and issues had not been recorded over long periods, resulting in incorrect balances reflected in the accounting records. This is a serious weakness which could lead to or result in losses without trace or detection, and is a contravention of Supplies Regulations and Procedures, Letebele said.
Similarly, consignments of a total of 892 bags of Malutu and 3 bags of beans from Tsabong depot to different feeding centres had not been received in those centres, and are considered lost. These are also not reflected in the Statement of Losses in the Annual Statements of Accounts for the same periods.