Acting High Court Judge Justice Godfrey Radijeng has this week ordered that the case in which Botswana Federation of Public, Private and Parastatal Sectors Union (BOFEPPPUSU) wanted court to instruct government to come back to the salary negotiation talks as “not urgent.”
Government parties at the Public Service Bargaining Council (PSBC) have refused to continue with the salary talks’ weeks after commencement in October. They were citing a pending court case filed by BOFEPPPUSU at the High Court before Justice Tshepo Motswagole – that will determine and make a ruling once and for all on the “scope of the Bargaining Council” that is currently under dispute.
When making a judgement this week in Lobatse High Court Justice Radijeng stated briefly that the case is “not urgent” and he did not go into the merits.
Speaking to Weekend Post shortly after the case, BOFEPPPUSU, Secretary General Tobokani Rari also confirmed that “the outcome of the court case is that the judge has indicated that the case is not urgent and the issue of the scope is left to be determined by Justice Motswagole in February 10, 2017.”
“We are really disappointed by the outcome. Our view is that the court has really misdirected itself in finding that this case is not urgent. Remember that this is the very case that the Industrial Court found to be urgent because they were basis of urgency of the case in the fact that there is still a salary negotiation pending,” Rari continued.
He said at the Industrial Court when Botswana Public Employees Union (BOPEU) questioned the legitimacy of BOFEPPPUSU the court agreed that the matter is urgent taking into consideration the aspect that the 2016/17 salary talks were and are still pending.
The same case, he added that went to Court of Appeal and the superior court still agreed that the issue is urgent looking into the fact that the 2016/17 wage negotiation were and are still incomplete. “Now it is surprising that a similar case affecting the same salary talks which are still undecided found that there is no urgency on the matter,” Rari complained.
He insisted that: “so we feel that it is unfortunate and disappointing that at the end of the day, court could not determine that this matter is urgent because the matter in our view is holding the awarding on increment of more than 75 000 employees in this Republic.”
It really baffles one’s mind and disappoints that court could arrive at such a decision in a matter that is so grave that affects more than 75 000 public servants who have not got their increment, the BOFEPPPUSU SG maintained.
We have said this several times, he pointed out that now what they have is two sets of public servants in the public service; that is, those that got the 3% and those that did not get the increase.
According to Rari, this is causing a lot of acrimony in the public service so they thought that cause could also determine that the matter have to be treated urgently. He explained that there is a lot of hostility in the public service between government employees themselves; that is, those awarded the 3% and those that did not get it.
“It is also affecting very much the moral of the public service. So like am saying we are really disappointed that the court had arrived at such decision.”The BOFEPPPUSU leader further told this publication that they will weigh options going forward in which they may resort to moving to want to ask Justice Motswagole to expedite the hearing of the case on the scope.
That includes, he said maybe petitioning him to reconsider the date of the hearing which is next year February so that it gets to be done expeditiously to assist them in resolving the case of “scope.” The other option Rari said might also be that, depending on what they will also be advised by their lawyers, they may have to appeal the outcome of the “urgency case” and ask for a leave to appeal the matter.
The union federation leadership will deliberate on the matter this week and thereafter meet their attorney Mboki Chilisa of Collins Chilisa Consultants who will also advise them on the way forward following their defeat.
According to Rari, they will also be writing and appealing to members to realise that they are in a struggle – fighting to preserve a principle and fighting “a coordinated and organised system.”
“We will notify our members that they should not despair. We are not just fighting for the 3% but they should realise that we are fighting for the bigger principle which is to protect the Bargaining Council and the Bargaining process in this country,” the unionist highlighted.
Rari has maintained to Weekend Post that “our strong view is that we cannot let the Bargaining Council be eroded but we should fight and if it means forfeiting the 3% for the purposes of protecting the Bargaining principle and the Bargaining power in this country let it be.”
He said that is why they approached lawyers with the intention to instruct government to come back to the negotiation table because their conduct of refusing to continue on the basis that the federation union has a case at High Court is “an unreasonable conduct.”
When narrating the event that has led to the court case, Rari said they initially started with a verification process as triggered by the court, which found that Manual Workers have got the numbers to sit in the PSBC.
“Therefore that the union being part of BOFEPPPUSU can now get into the Public Service bargaining Council and start negotiating so we then went to back to the Bargaining Council with the intention to negotiate.”
He said the government then indeed brought in the counter proposal of 3% to the Bargaining Council but they wanted to stick to the amount – which by then they have already implemented. Then before they could start negotiating they needed to come up with the rules of engagement and so the process of negotiations did not start yet.
“But it’s normal that before you start negotiating you have to start talking about the rules of engagement. So when we were talking about the rules of engagement they raised the issue of “who are we negotiating for” as BOFEPPPUSU.”
In other words they were saying what the scope of our negotiations is, Rari said adding that we then indicated to them that the scope of our negotiations is our members – that is we are negotiating for members of those unions only.
The members include Botswana Teachers Union (BTU), Botswana Sectors of Educators Trade Union (BOSETU), Botswana Land Board & Local Authorities & Health Workers Union (BLLAHWU), National Amalgamated Central, Local & Parastatal Manual Workers' Union (NACLPMWU).
According to the BOFEPPPUSU SG, the reason why they were saying that is because the Industrial Court Judgement has then ordered that the members of the applicants (BOFEPPPUSU) are not going to be given a 3% but instead will be allocated to the non-members of BOFEPPPUSU and the non-unionised.
So we then stuck to what the Industrial Court has ruled particularly where they were stating that the members of the union Federation are not supposed to get the 3% salary increment and even to this day they have not received, he justified.
He said while still there, the Industrial Court has also asserted that BOFEPPPUSU has a good case about the scope of the Bargaining Council that is before Justice Tshepo Motswagole.
“It is at this point that the government parties at the PSBC stated that they find it difficult to proceed with the negotiations because we have an issue of the scope of the PSBC in court before Judge Motswagole and that is true.”
But what happened is that, he explained that when the Industrial Court gave its judgement it pointed out that the scope of the PSBC is only limited to those employees whose unions are in the Council. He admits that still by then they felt that the Industrial Court in fact has misdirected itself but as it was interdict, “we couldn’t appeal it.”
What we could only do was to register a fresh case so that deal finally with the issue of scope currently before Justice Motswagole, he asserted. If we could stay with that Industrial Court Judgement, the unionist highlighted its implications.
“It meant that every year when we negotiate at the PSBC and for instance let us say BOPEU would still not be in the PSBC, it would mean that every year when we are in the process of negotiating, government may continue to make unilateral increments and that would only apply for BOPEU members and the non-unionised.”
He continued to state that therefore it would also mean that every year the Bargaining Council would become useless because they would continuously do so. “That is why the judgement of the Industrial Court meant – in essence.”
He recounted that they then thought that they can’t live with the judgement because it will render the PSBC powerless and useless. “So we then approached the court and registered a new case in which case we wanted the High Court to finally determine what the Public Service Act and the constitution of PSBC say about the scope of the PSBC, he said.
In our interpretation both guiding documents are very clear that there shall be a PSBC responsible for conditions of the “public service.” He added that to BOFEPPPUSU it meant that the PSBC can determine terms and conditions for “all the public servants” except those non-unionised members like the Botswana Defence Force (BDF), Botswana Police Service (BPS), Directorate on Corruption and Economic Crime (DCEC) and others stated in that category.
Rari emphasised categorically that as BOFEPPPUSU they want the outcome of the negotiations of the PSBC to affect the whole of the Public Service. The government has insisted that owing to the case before Justice Motswagole, they felt that they cannot continue with the salary negotiations. Then they maintained that its either BOFEPPPUSU withdraw the case at court or they do not continue with the salary negotiations.
The federation SG said this became difficult for them to withdraw the case because of what they felt the case means for them and therefore told the government party that they cannot withdraw the case and agreed that they disagree.
“After we agreed to disagree we then approached lawyers to say that we intend to instruct government to come back on the negotiation table because their conduct of refusing to continue on the basis that we have a case at High Court is an unreasonable conduct.”
According to Rari, the reasons that we were advanced was to determine who exactly does the outcome of the Bargaining Council affects. “The thing is when you are admitted in the Council you can make a resolution of any form if parties agree. So there was no reason for them to talk about the matter of scope before court as the Council itself can still make a resolution and that’s what we consistently said.”
The issue of scope guides on the parameters of the Bargaining Council and the court case impending before Justice Motswagole is just for theoretical definition so that it is known – the latitude of the PSBC.
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.”