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PPADB reforms public procurement system

The Public Procurement and Assets Disposal Board (PPADB) has introduced public procurement reforms following some qualms from the World Bank about secrecy surrounding the country’s procurement plans.


The PPADB has since moved to introduce the publishing of public procurement plans. The Ministerial Tender Committees (MTC) and District Administration Tender Committees (DATCs) are now required to submit their annual procurement plans with the board for publishing. MTCs and DATCs deal with procurement of goods, services and works which are below P300 million in value. The MTC financial ceiling range from P25 million to P300 million while ceilings for DATCs range from P2 million to P10 million.


In 2013, a World Bank report indicated that lack of publishing of procurement plans by government and other procuring entities exposed the country’s procurement system to abuse and corruption by those in decision making positions. Best practices in public procurement, as set by institutions such as the World Bank and Organisation for Economic Co-operation Development (OECD) requires that the government and other procuring departments should avail all information about upcoming government tenders to allow bidders a fair chance to prepare themselves to participate.


In the past, the knowledge of upcoming government tenders was the preserve of those in decision making positions, giving them the opportunity to collude with others in the private sector by giving them unfair advantage to win the tenders. Other players only got to know of the tenders when they were advertised for bidding, which did not give them ample time to prepare to compete.


According to the OECD, corruption thrives on secrecy. Therefore they want to make transparency and accountability recognised key conditions for promoting integrity and preventing corruption in public procurement. The PPADB has also introduced the whistle blowing policy, which is viewed as key in public procurement to enable stakeholders to be able to report matters relating to improper, unethical and inappropriate conduct in tendering.  


The management of the Tip-Off service was outsourced to Deloitte and Touche, which won the tender in January this year “to enhance the confidentiality of the system”. PPADB Executive Chairperson, Bridget Poppy John has also indicated that the board is working on drafting the Anti-Corruption Policy, further stating that the integrity office is being established to provide more focus on ethical conduct and anti-corruption measures.


In the past, the PPADB admitted to not having qualified human resource in the field of procurement for MTCs and DATCs to execute tenders in an effective manner. Botswana Accountancy College (BAC) has been engaged by the board to offer a Certificate in Public Sector Procurement and Tender Process Management which was developed in collaboration with the PPADB.


The BAC is also working on developing a Master in Procurement and Logistics programme. The University of Botswana was engaged by the World Bank in 2016 to provide technical input in the development. The OECD indicates that public procurement is increasingly recognised as a strategic profession, rather than a simple administrative function that plays a central role in preventing mismanagement, waste and potential corruption, therefore encouraging entities to attract and retain highly skilled professionals.


The World Bank has also underrated Botswana’s public procurement in the area of “Bid opening, Evaluation, and Award,” scoring 43 out of 100 in its latest assessment. Public procurement is viewed as a sensitive subject because it involves the spending of public funds in project which the government is expected to get in value for money.  


Botswana, which is still reforming, is expected to have in place practices such as publishing procurement policies, advanced publication of procurement plans, advertisement of tender notices, disclosure of evaluation criteria in solicitation documents, publication of contract awards and prices paid, establishing appropriate and timely complaint mechanisms, implementing financial and conflict of interest, disclosure requirements for public procurement officials and publishing supplier sanction lists.


However the government advertising ban on private newspapers could be a major dent on the country’s procurement system.  Ministries and other government departments only advertise their tenders in government owned Daily News, contrary to best practices which state that tender notices should be widely advertised.  


The PPADB has a partnership with the OECD which supports governments in reforming their public procurement systems to ensure cost savings and better service delivery. The OECD promotes efficient and effective public procurement systems because it considers public procurement the backbone of a well-functioning government that ensures delivery of quality services to the public.


Botswana’s economy as a developing country means government continues to be the main player and the biggest provider of business to the private sector. Government expenditure through public procurement activities represents about seventy percent of the Gross Domestic Product. This essentially means the well functioning of the economy in Botswana solely rests on the efficiency and the integrity of its public procurement system when compared to most developed countries where public procurement accounts to a less percentage of up to 20 percent.


The primary mandate of PPADB is to adjudicate and award tenders for Central Government and any other institutions specified under the Act for the delivery of works, services and supplies related services. This is coupled with the registration and grading of contractors who so wish to do business with government.

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13 AUGUST 2022 Publication

12th August 2022

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DIS blasted for cruelty – UN report

26th July 2022
DIS BOSS: Magosi

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.

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Stan Chart halts civil servants property loan facility

26th July 2022
Stan-Chart

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.

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