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Mokaila, Tshekedi’s Big money swap

Following his arrival at the Ministry of Transport and Communications, Minister Kitso Mokaila could find himself handing over Air Botswana to Tshekedi Khama’s Ministry of Environment, Wildlife and Tourism, if what was recently relayed at the parastatal’s board persists.

Mokaila was shuffled from the former Ministry of Energy and Water Resources. The reason advanced for moving Air Botswana to Tshekedi’s ministry is that most of the Air Botswana customers, roughly about 70 percent of them are tourists. This publication has been informed that the Air Botswana board chaired by former Botswana Defence Force (BDF) Commander, retired Major General Tebogo Masire was recently briefed on the possible developments following the re-organisation of Ministries.

The decision is also accompanied by a development that will see a P2.6 billion tender to acquire four jets and turboprops being cancelled and re-started at the new parent Ministry.  The tender process was almost at the final stages of due process. Three companies, Bombadier of Canada; ATR of France; and Embraer of Brazil had entered the race to scoop the lucrative deal. The Acting General Manager of Air Botswana, Agnes Khunwane had mentioned in passing at the Samson Guma Moyo chaired Parliamentary Committee on Statutory Bodies that they intend to acquire new Aircrafts in the near future.

Over a pro-longed period of time, Air Botswana has been using ATRs. The Air Botswana engineers and pilots are trained and upskilled in ATRs. The stock and tools are customised to ATRs. Weekend Post gathers that even this time around, ATR had put a convincing bid and was on the verge of outdoing Bombardier and Embraer. In fact this is the tender that forced former Minister of Transport and Communications, Tshenolo Mabeo into the controversial trips to Brazil, Canada and France to do some form of window shopping for aircrafts. The trip has since invited the wrath of the Parliamentary Committee because Mabeo and his then permanent secretary were found to be not fit to decide on the mode of aircraft to be procured by Air Botswana.

ATR’s PROPOSAL WAS APPEALING 

In its proposal, ATR of France was to also buy back Air Botswana aging fleet at market price. Indications from Air Botswana sources are that the whole fleet has reached end of useful life.  The Board is said to have been impressed with this offer. In addition ATR had pledged to further train Air Botswana engineers and pilots for free on the new Aircrafts in the event that they get the job. The Board had also considered the fact that its staff and the tools for maintenance were compliant with ATRs models. ATR was most likely to get the job to supply the three turboprops.

BOMBADIER WANTS “ALL OR NOTHING”

For its part, Bombardier, which sliced in half the 2016 delivery forecast for its C Series aircraft this week, and said it expected full-year revenue to be at the lower end of its previously announced range, had made it clear that it wanted to do the job as a whole, “all or nothing”. They wanted to supply both the jets and the turboprops. The Board had considered Bombardier for the jets, but following their “all or nothing” demand, they were dropped on the basis that their proposal was inferior to that of ATR when it comes to turboprops. Bombardier, which has agents in Botswana, has in the past supplied the Presidential jet to Botswana. The Department of Wildlife and National Parks operate the KODIAK, also from Bombardier for various logistical missions and departmental duties as well as for anti-poaching and law enforcement.

The setback is the latest for the CSeries program, which took years to get off the ground and has been hit by production delays and cost overruns, causing the Montreal-based plane and train maker to agree to a C$1 billion ($774 million) investment from the Quebec government. The company remains in talks with the Canadian government about further funding.

Bombardier Inc. cautioned that private-aircraft prices will remain under pressure as it posted a wider-than-expected loss, adding to Chief Executive Officer Alain Bellemare’s burdens as he tries to turn around Canada’s largest aerospace company. Reports from Canada indicate that shrinking demand for corporate planes–typically Bombardier’s most profitable business–is weighing on Bellemare as he works to increase profit and cash flow.

The planemaker cut production of its Global 5000 and 6000 business jets last year, and delayed entry into service of another model by two years as sales of large private planes dropped.

EMBRAER WAS CONSIDERED FOR JETS

The Brazilian company is currently doing well in the market and was most likely to be considered for the supply of jets, which is dominantly their stock in trade.

World demand for jet aircraft in the segment of 70-130 seats from 2016 to 2035 will total 6,400 units, according to the forecasts of Brazilian aeronautical company Embraer disclosed at the Farnborough Air Festival in the United Kingdom.

Embraer projects demand for aircraft with between 70 and 90 seats to total 2,300 units while for aircraft with 90 to 130 seats demand is expected to reach 4,100 units, with the overall demand in the period valued at around US$300 billion.

The Brazilian company also said that the world’s fleet of jet aircraft in the segment of 70-130 seats will increase from 2,670 in operation in 2015 to 6,690 in 2035, with the fastest growth of all commercial aviation segments.

AIR BOTSWANA AG GM WITHDRAWS FROM SHORTLIST

As the search for a permanent General Manager at Air Botswana continues, the Board could find itself in a position where they present just one name for consideration to Cabinet. This publication has learnt that Agnes Khunwane withdrew her name from the shortlist of candidates earmarked for the position.

It is understood that she is not happy because she was initially the only candidate left in the shortlist after another set of five fell off on technicalities and lack of business background, but the Board chairman, Masire was unsettled by the prospect of submitting just one name to cabinet for consideration.

The chairman then embarked on a head hunting exercise which led him to former MVA Chief Executive Officer, Cross Kgosidiile. When Khunwane heard of this development she wrote a letter withdrawing her name, pushing the Board back to square one. It is not clear if she will be coerced to rescind her withdrawal or Kgosidiile, a former Air Botswana Finance Manager will be unchallenged before cabinet. The twist into the whole matter is that Kgosidiile left MVA without an explanation for his departure. 

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Government sitting on 4 400 vacant posts

14th September 2020
(DPSM) Director Goitseone Naledi Mosalakatane

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.

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FNBB projects deeper 50 basis point cut for Q4 2020

14th September 2020
Steven Bogatsu

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.

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Food suppliers give Gov’t headache – report

14th September 2020
Food suppliers give Gov’t headache

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.

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