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Leaked: Why BOPEU left BOFEPUSU

An internal communication of the Botswana Public Employees Union (BOPEU) detailing the reasons behind disaffiliating from the Botswana Federation of Public Sector Unions (BOFEPUSU) has been leaked, and it categorically states that “BOPEU and BOFEPUSU” can never work together because they believe in two different things.”  

BOPEU is a founding member, alongside Manual Workers Union (NACLGPWU) or “MWU”, of Botswana Federation of Public Sector Unions (BOFEPUSU). However, in recent months and years the working relationship between BOPEU and BOFEPUSU has ‘irretrievably broken down’ , as illustrated in the following incidents and developments. In December 2015 BOPEU Congress resolved to disaffiliate from BOFEPUSU and to carry out due diligence on Botswana Federation of Trade Unions (BFTU), before a final decision to affiliate to BFTU could be made.

BOFEPUSU Congress of February 2015

The leaked BOPEU communication points to several issues that have arisen which caused a serious strain on relations between BOPEU and BOFEPUSU, “which relations are now irreconcilable”.

Congress Call –  BOPEU says According to clause 3.3.1.3 of the BOFEPUSU constitution the 2015 Congress should have been held in August 2014, with the Congress call issued 90 days prior (i.e. in June 2014), accompanied by an Agenda. BOPEU contends that BOFEPUSU Executive delayed the holding of Congress without any valid reason (e.g. valid reason could be pending audit), until BOPEU threatened, in October 2014, to withhold subscriptions as leverage to compel BOFEPUSU to obey its own constitution. Had it not been for BOPEU’s intervention, in writing and threatening, that a Call to Congress was made by BOFEPUSU Secretary General in December 2014 for February 2015.

“This deliberate avoidance of Congress caused a lot of animosity, political skirmishes and strain on relations between BOPEU and BOFEPUSU. It also indicates the administrative and organisational state of BOFEPUSU,” reads the document.  

BOPEU Motions – In the view of BOPEU, their written motions were not allowed (not permitted for discussion) because they were submitted late, even though the BOFEPUSU constitution allows even for motions from the floor of Congress (special resolutions). They state that most of the motions sought to improve governance and administration of BOFEPUSU and for a review of BOFEPUSU constitution.

“The rejection of the motions illustrated how BOFEPUSU regards BOPEU’s contributions – that BOPEU’s contributions should be excluded at all costs.”  

Annual Audits – BOPEU says according to clauses 11.4.3.1 and 11.4.3.2 of the BOFEPUSU constitution the Secretary General is responsible for “preparation and circulation of financial annual report…and circulation of auditor’s report”. Clause 14.7 makes the carrying out of audits mandatory. BOFEPUSU Executive and secretariat failed to present to Congress Audited Financial Report (or at least Interim financials), in violation of its own constitution and of Section 42 of TUOEA. In addition to delegates’ calling for audited statements at Congress, BOPEU says it has written several letters to BOFEPUSU, in response to BOFEPUSU’s demands for funding, in which BOPEU sought explanation as to why BOFEPUSU cannot comply with the law and its own constitution with respect to auditing. No responses were received.

“It must be noted that Audited financials are required as a main component of Annual Returns to the Registrar of Trade Unions and are a valid ground for de-registration. The old Executive has admitted publicly that BOFEPUSU never carried out an Audit of its accounts since it was formed in 2008. As a result of BOFEPUSU’s continuous failure to account, BOPEU NoB, NEC and GC resolved to withhold monthly subscriptions to BOFEPUSU, to try to compel BOFEPUSU to account. BOPEU’s monthly subs amount to P28,000 pm or P336,000 per annum,” reads the BOPEU internal document.

“BOPEU delegates’ request for audited financials was regarded as a provocation or because “BOPEU is a sell-out”. There was and is still no remorse about failure to account and it seems the omission was deliberate,” concludes the report.

Minutes of 2012 Congress – The Secretary of the BOFEPUSU Executive also failed to submit minutes of 2012 Congress. Likewise, BOPEU delegates’ request for minutes was also regarded as a provocation or because BOEPU is a “sell-out”. Again, it seems the omission was deliberate and to date there is no official record of the 2012 Congress.

Eligibility of Union employees to hold positions on BOFEPUSU Executive: BOPEU delegates tried to raise the issue of whether union employees were eligible to stand for union political positions in the BOFEPUSU Executive, in light of Section 21 of the TUEOA. Again BOPEU’s raising of the issue was viewed as a provocation, especially of Manual Workers Union (MWU), which nominated four (4) of its employees into the Executive. Yet this issue has long term implications on the legality of BOFEPUSU itself, as currently more than half of the BOFEPUSU Executive are union employees. Section 21(1), (2) and (3) of TUEOA read thus;

“No person shall be admitted to membership of a trade union unless he is an employee in an industry with which the trade union is directly concerned. No employee of a trade union shall be admitted to membership of the trade union. Upon a member of a trade union becoming an employee of the trade union, he shall immediately cease to be a member of the trade union.

BOPEU argues that the majority of persons allowed to stand and who currently occupy positions in the BOFEPUSU Executive did not qualify to stand or to be elected. They poke at the eligibility of
Mr Johnson Pikinini Motshwarakgole – Secretary for Labour Affairs – Employee of MWU; Mr Samuel Molaodi – Secretary for Education Affairs – Employee of MWU;  Mr Simon Kgaoganang – Secretary for Gender and Women’s Affairs – Employee of MWU; Mr Johannes Tshukudu – President – Employee of BTU; and Mr Ketlhalefile Motshegwa – Deputy Secretary General – Employee of BLLAHWU.

BOPEU says since union employees are not employed in the industry with which the trade union is concerned (i.e. not workers) they are not eligible to be members and are precluded from paying membership/subscription fees. The above persons are not “members” or “officers” of the affiliate trade unions.  

“Ironically, the same reasoning was used to remove the BLLAHWU President from office (i.e. not paying subscription). Effectively this renders BOFEPUSU an unlawful organisation, saved only by Government’s (Registrar’s) inaction, whether deliberate or due to ignorance.

When this matter was raised at the 2015 Congress some of the above persons demonstrated that they are aware of the provisions of the law and the constitution. The prolonged illegality is therefore deliberate and self-serving.”

“Rather than being embroiled into a political and legal battle it is easier (and wiser) for BOPEU to disaffiliate rather than go through the legal and political battle with BOFEPUSU Executive. It is not worth it,” reads the leaked document.

BOPEU candidates’ nominations and Elections: BOPEU says at nomination time, there was a pattern of predetermined outcomes to reject all BOPEU nominations. BOPEU’s exclusion was also demonstrated in songs composed about BOPEU by delegates from other unions and a general hostile environment.

“The atmosphere was a clear, practical demonstration that BOPEU was unwanted in the family. The celebrations thereafter on social media of how BOPEU has been white washed also added to the confirmation of the attitude.”

Internal relations in the old BOFEPUSU Executive: According to BOPEU, prior to Congress there was a deliberate undermining of the then BOFEPUSU President (BOPEU VP) as an extension of BOPEU’s marginalisation. Some members of the BOFEPUSU Executive held official CEC meetings without her knowledge and participation. One such meeting held at Airport junction mall resolved to make a press release about BOFEPUSU’s endorsement of UDC. When she made a Press Release to correct the position the Secretary General made a counter statement.

“These CEC intra-conflicts also contributed to the current situation. The ‘apology’ by BOFEPUSU Secretary General at the 2014 Annual Convention did not address the fundamental issues  but just an appeal to let ‘bygones be bygones’. No attempt was made to reconcile differences. Instead in 2015 when similar differences have arisen, BOFEPUSU’s Secretary General expresses confidence that BOPEU Congress will agree with them. This kind of self-assurance takes BOPEU members for granted,” reads the internal communique.

Bargaining Council is another area of contention, which has brought irreconcilable difference, is the issue of membership of the Bargaining Council. BOPEU says when the term of office of the previous Council lapsed, BOPEU sought to have its members replaced.

“The view in BOPEU has been that this provided an opportunity to replace political officers with independent skilled negotiators who will have mandates but not vested interest, to reduce political controversy, which was bogging down progress in the Council. It also brought an opportunity to have Government team also replaced. However, BOFEPUSU negotiators wanted to maintain status quo. Their interpretation of the PSBC constitution coincided with that of the employer party,” BOPEU says.  

UNIGEM and other investments – Another cause of differences concerned UNIGEM, says BOPEU. UNIGEM was making losses in a row, at a time when the contract was coming to an end.

“By its own projections UNIGEM was projected to make an accumulated loss of P7m in over 5 years. Yet BOFEPUSU stated that UNIGEM was a profit making entity and spread malicious rumours that BOPEU was going to be given the tender alone as a reward for supporting for BDP in the 2014 elections, through a deal with a certain Mr Chitube, who was being prepared to be the next BDP President. Recently (November 2015) BTU stated the same issue in its annual report, that UNIGEM losses have affected the balance sheet of their investment arm, More Power Investments (Pty) Ltd. BTU was not accused of any BDP links despite holding the same view about UNIGEM as a loss-making entity,” reads the BOPEU document.

“Why was BOPEU expected to carry on with a loss making entity? On the hand BOPEU has not disinvested from BOTUSAFE, which is another joint venture with some BOFEPUSU affiliates, because it is making profit.”

Political affiliation – BOPEU says another source of irreconcilable difference is how each organisation handles the issue of political alignment and /or UDC endorsement. BOPEU says its position is based on a Convention resolution that the union should not align or affiliate to any political party. Though this position is reviewable by Convention or Congress it is binding on BOPEU Executive (NoB and NEC). Any BOPEU official who expresses this position is therefore speaking on behalf of all members.

“On the contrary the group, which now controls BOFEPUSU Executive, prefer that such decisions be regarded as operational rather than policy decisions. They held this same view before the Congress which they continue to maintain: that the issue of political alignment can be changed at any time. Yet they do not have a mandate from members giving them latitude to decide on such a matter,” reads the BOPEU document.

According to the document Clause 3 of BOFEPUSU constitution states that “Congress shall be the sole decision making body of the federation….every matter for consideration by Congress shall be on motion duly seconded…”. It is this very democratic procedure that the dominant group in BOFEPUSU Executive thwarted at the 2015 Congress by blocking BOPEU motions.

“While BOPEU believes that the issue of political alignment is a major policy decision that cannot be made by a few individuals on behalf of members, BOFEPUSU Executive believes that not only do they have a right to make that decision, they could also change it as many times as they wish. The least that BOFEPUSU could do is to refer this contentious issue to the General Council (GC). Thus, the Central Executive has abrogated itself the powers of both the GC and Congress.”

BOPEU says this is one of the main causes of irreconcilable difference between BOPEU and BOFEPUSU. “At the core is the issue of governance, of a federation leadership which believes it should make decisions on behalf of members versus an affiliate which is democratically controlled by members. Not only is conflict inevitable but will be endless.”

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Mowana Mine to open, pay employees millions

18th January 2022
Mowana Mine

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.”

Negotiated estate is P35, 563,000

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Councilors’ benefits debacle-savingram reveals detail

18th January 2022

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.

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Households spending to drive economic recovery

17th January 2022

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.”

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