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Decline in accountability hurts implementation – BIDPA

BIDPA SENIOR RESEARCH FELLOW: Keneilwe Marata

Senior Research fellows at the Botswana Institute of Development Policy Analysis (BIDPA), Gape Kaboyakgosi and Keneilwe Marata have pinpointed key factors that have led to implementation challenges in Botswana. They noted that for public policy goals to be realized, implementation needs to be optimized.


According to the Researchers, these include declining public accountability, lack of commitment to reforming the public sector, and a decline in commitment by state authorities and the declining credibility of the government’s ability to adhere to its policies, among other factors. These challenges emerge as strong bottlenecks to optimal policy implementation.


Lack of commitment to selected policy choices is emerging as an important challenge for project implementation. Kaboyakgosi and Marata posit that since the turn of the new millennium, the government has increasingly created and adopted policies to which it does not adhere.


They cite that policy commitment assists in building state credibility (when dealing with outsiders such as investors), and certainty among the locals. They also give a number of examples that show failure in this respect:

• The failure to privatize Air Botswana after the Government had called for international bidders to buy a stake in the national airliner, including the government spending funds in procuring an international transaction advisor,

• The failure to procure a private sector partner to develop the Botswana International University of Science and Technology (BIUST) campus in Palapye in partnership with the Government, as had been promised. Though the Government’s call for a partner resulted in two such partners posting a P1 million each, the fate of the two bonds of one million Pula each that were posted remain unclear

• Commitment to the Public Private Partnerships (PPP) Policy appears half-hearted. Whereas the policy was adopted by Parliament, there appears to be little enthusiasm for PPPs and there is insufficient explanation why this is so. Thirteen years after the adoption of the Public-Private Partnership Policy and Framework, only two minor undertakings have been carried out under the PPP framework.


According to Kaboyakgosi and Marata, besides the slowing momentum of policy implementation, the policy reversals mentioned above have other costs. They observed that a committee charged with reviewing the implementation failures associated with building the Botswana International University of Science and Technology (BIUST), came up with a number of costs likely to result from policy reversals related to the project.

These include uncertainty of investment returns, impact on investor confidence, and adverse impact on the international marketing of Botswana projects, negative perception of government commitment, and the erosion of reputation in the medium term.


The BIDPA researchers also point out that Botswana appears to be experiencing a steady decline in accountability. Botswana’s public accountability has declined from 75 percent in 1996 to 60 percent in 2010, according to the World Bank Institute, they write. According to Kaboyakgosi and Marata, optimal public accountability ensures that goals are not diverted, and excesses are kept at a minimal, but holding politicians and public servants accountable for their actions (or omissions) is diminishing in Botswana.


“Such a culture pervades the civil service and state owned corporations. In the civil service, the limited capacity for oversight by Parliament and the Office of the Auditor General (OAG) compounds the problem.

Parliament comes into contact with the budget on the day the speech is read by the Minister in charge of finance and development planning. Parliament then has only a month to debate a document that has taken ten times longer to prepare, with little access to the parameters that informed the same budget(s). Similarly, the OAG lacks the authority to enforce some of the decisions it makes in relation to poor management of public resources, leading to repeated malpractice,” wrote Kaboyakgosi and Marata.


The two Researchers poke further by stating that: “Where state owned corporations are concerned, a number of parliamentary inquiries have revealed a worrying trend that points to lack of accountability. Committees set up to investigate poor performance at the Botswana Meat Commission (Republic of Botswana 2013) and the failure of the Palapye Glass Project both conclude that the major causes of failure include poor corporate governance, lack of due diligence, failure to contain prices, and poor project management. Poor accountability results in implementing agents not taking their tasks seriously, misappropriating funds, or changing the goals of policy.”


They are also concerned by the reluctance to reform. Kaboyakgosi and Marata observe that since the turn of the century, Botswana’s rankings in certain policy areas, particularly those concerned with industrial development, diversification, and competitiveness and doing business have been declining steadily. Initially adept at reforming her political, economic, legal and other frameworks, Botswana’s reluctance to reform is becoming more pronounced. The submit that the decline as shown by indicators such as the Doing Business Index (DBI) and the Global Competitiveness Index (GCI) suggests an unwillingness by Botswana to reform policies and laws to respond to a changing world.


“While it is arguable that the DBI shows some growth for the period under review, such growth is minimal, given the urgency to position Botswana as a destination of choice for foreign direct investment. The GCI on the other hand shows a steady decline in performance, from number 56 best countries in the world in 2008 to number 80 by 2011,”they wrote.


Another notable example of a reform process that has been abandoned quietly is the implementation of the results based monitoring and evaluation (RBM) inside the Government. RBM is used to generate information and data needed for evidence based policy making and it facilitates accountability and aids planning.


“Lack of commitment to reform is also evidenced by the failure to empower reform institutions, such as the National Strategy Office and the Public Enterprises Evaluation and Privatization Agency (PEEPA), thus rendering them incapable of driving reform. The NSO, a semiautonomous agency in the Office of the President, whose mandate includes coordinating the Botswana Excellence Strategy (BES), lacks legal authority to undertake certain aspects of its mandate. Similarly PEEPA, formed out of the Privatisation Policy for Botswana to advise the Government on the readiness of state owned institutions for privatization, has no legal basis to implement its mandate because it is a creation of a policy. As a result, neither one of these important agencies is able to enforce its mandate, leaving compliance and implementation to the discretion of the implementing agencies.”

The challenges of policy complexity

Another implementation challenge, according to the two BIDPA Researchers, is the growing complexity of the economy, administration and society. They point out that three challenges characterize complex implementation problems: The capacity to tackle complex problems is often distributed among actors; Complex problems are difficult to predict: many social, political and economic problems are not easy to forecast; and Complex problems often involve conflicting goals.


They insist that while many of the policy challenges facing the Government are complex, many implementation structures are ill-suited to handle complexity. According to Kaboyakgosi and Marata, the result of this is that implementers focus overly on one cause or effect, to the detriment of other equally important causes or effects of these policy challenges.


They buttress that Botswana’s persistent challenges such as poverty, the spread of HIV, slow diversifying economy and high unemployment have multiple causes and effects, so managing them is difficult. Many laws and policies, as well as agencies need to be mobilized to achieve positive outcomes.


In addition, Kaboyakgosi and Marata observed that another important implementation challenge is the propensity, particularly in the public sector, to undertake projects without due assessment of the need for such projects. They point out that projects are developed because of the ability of the Government to procure them than an assessed need for such projects. Examples include the following:

• Both the Francistown and Maun abattoirs to add to the original one at Lobatse resulted in the Botswana Meat Commission losing profitability as its cost structure rose.

• Undertaking the Morupule B Power Plant, BIUST, major dams all within a five year span constrained labour supply and drove construction prices up (MIST 2012), and

• Constructing vocational training colleges (VTCs), led to an over-supply of these, and an undersupply of students and instructors.


The BIDPA researchers state that Supply driven implementation has a number of undesirable consequences. Among these effects are that though undertaken at great financial cost, outputs of such implementation tend to have little relevance to the needs of the nation. Additionally, when projects are implemented without due regard for demand, priority areas are deprived of much needed funds.

“Added to the foregoing, projects implemented without due regard for the demand send wrong signals to the market; businesses tend to mobilize financial and other resources in response to what they see as public sector priorities, only for these to have minimal future sustainability. The consequences of this is that businesses may borrow money from banks, train and employ human resources and purchase materials, only for the Government priorities to change, saddling such businesses with expensive and idle facilities,” they wrote in their paper.


Kaboyakgosi and Marata further indicate that while there appears to be consensus that implementation challenges have become more pronounced in Botswana, there is no explanation for this problem. They state that until recently, lack of finance, which is one of the often cited implementation challenges, has not been a problem in Botswana. “However, this challenge is likely to gain prominence with the decline of mineral revenues. The next section therefore outlines some of the causes of Botswana’s implementation challenges”.


Furthermore, Botswana’s implementation challenges transcend economic and social policies as well as affect the capacity of the state to achieve many of its stated policy aims. According to Kaboyakgosi and Marata, a number of implementation challenges have since become prominent in Botswana and these include the persistence of HIV/AIDS, slow economic diversification, rising youth unemployment, poverty and social inequality.

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Botswana’s development agenda in jeopardy

21st September 2020
Botswana’s-development-agenda-in-jeopardy--water-construction

Stanbic Bank Botswana Quarterly Economic Review indicates that Botswana will fail to meet some of its Vision 2036 targets, particularly unemployment reduction and reaching high-income status.

The report says this is mainly due to the slow economic growth that the country is currently experiencing. This Quarterly Economic Review focuses on the 2020 Budget Speech.

The first paper reviews the entire budget with its key observations being that this budget is prepared as prescribed by the Public Finance Management Act; the priorities it seeks to address are drawn from Vision 2036 and the eleventh

The 2020 budget Speech, which was the maiden speech by the Minister of Finance and Economic Development, Dr. Thapelo Matsheka, and the first after the 2019 general elections, was delivered to Parliament on the 4th of February 2020.

It has been well received by the labour unions, business community, and the public at large as well as international organisations such as the International Monetary Fund (IMF).

It mainly derived its support from key facets including, emphasis on changing the business-as-usual approach to development; outlining the transformation agenda; fiscal reform that minimizes the negative impact on economic development and human welfare, competiveness and the decision to implement the 2019 negotiated and agreed public sector.

The budget’s progress review shows that economic growth was consistent with the NDP 11 projections, with growth of around 4 percent. At this growth rate, the country would neither ascend to a high-income status nor reduce unemployment towards the Vision 2036 target of a single digit.

Simple calculations of this review confirm that the economy will need to grow the Vision 2036’s target of 6 percent over the next 16 years for per capita income to increase from around USD 8,000.00 to above USD 12,000.00 in current prices.

Further, the population is anticipated to grow by only 2 percent per annum.

For this reason, the focal areas for the forthcoming FY’s budget include measures to increase economic growth towards an average of 6 percent per annum.

Economic diversification is reportedly progressing fairly well. The report says, the share of the non-mining private sector in value added has risen to 66 percent in 2018 from to 63 percent in 2015.

The sectoral pattern of growth showed that the performance of services sector (particularly transport & communications, trade, hotels & restaurants, and finance & business services) has been the silver lining and that of mining sector was subdued whilst the utility sector disappointed.

The drive towards the service sector of the economy, especially to low-productivity activities (tourism, public administration, wholesaling and retailing) does not bode well for the country’s development aspirations.

In the previous versions of this Quarterly Review, it was noted that there is need for the rethinking of economic diversification. Since the country’s domestic market is small, it is inevitable that economic diversification not only focus on broadening the product mix, but also the composition of exports and markets.

This understanding of economic diversification has not been embraced by this year’s budget. Consequently, Botswana’s exports are still overwhelmingly diamonds, which means that the rest of economic sectors are still highly dependent on foreign-exchange earnings from diamonds. Thus, “the transformation programme requires a review of the country’s entire ecosystem”.

The budget review of the economic context also depicts that an economy with positive medium-term prospects, with growth expected to recover to 4.4 percent in 2020 from the expected growth of 36 percent in 2019 largely due to faster growth of services sectors and, thereafter, to slow-down to 4 percent in 2021.

These projected growth rates are comparable to those of the IMF staff’s baseline scenario of 4.2 percent in 2020 and 4 percent in 2021. Thus, the business-as-usual scenario produces growth rates that are still too low to achieve Botswana’s development objectives and create enough jobs to absorb the new entrants into the labour market.

Trade tensions between the two major markets for diamond exports, viz., the United States of America and China, is one of the factors that are cited as contributing to, indeed, undermining not only the domestic growth, but also the fiscal position.

Another notable downside risk to both global and domestic growth is outbreak of the coronavirus in China around January 2020. This has been declared as a global health emergency. In an attempt to contain the spread of the novel coronavirus pneumonia, the Chinese authorities have ordered city lockdowns and extended holidays, of course, at the expense of near- term economic growth, according to the new Stanbic Bank Botswana report.

According to Nomura Holdings Inc., fewer migrant workers returned for work than in previous years and business activities have been slow to pick up. The havoc wreaked by the virus on the world’s second largest economy is likely to spill over to the global economy. In fact, it has resulted in a glut in crude oil and, thereby placed oil markets into a contango, i.e., a market structure where near-term prices trade at a discount to future contracts.

It also presents significant risks one of Botswana’s main drivers of economic growth, diversification and foreign exchange earnings. According to the Financial Times (February 13, 2020), Chinese tourists spent $130 billion overseas in 2018. Regardless of whether the growth materializes, the projected domestic growth rate would not transform the economy to a high-income one.

Progress towards reduction of unemployment, to a target of single digit, and poverty and achieving inclusive growth has also been relatively slow, the Stanbic Bank Botswana Review says.

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OP leases Orapa House

21st September 2020
Orapa House

Ministry of Presidential Affairs, Governance and Public Administration (MOPAGPA) has through the Office of the President (OP) proposed to avail Orapa House for use by private training institutions as well as research institutions involved in the area of technology development.

For a very long time the monumental building located in the heart of the city has been a white elephant, despite government purchasing it for nearly P80 million from De Beers in 2012.

However, government has now identified a productive use for the iconic building. “The overall vision is for the building to be transformed into a hub for digital technology research and development to be carried-out by institutions, such as; Limkokwing University, BIUST, BITRI and other relevant stakeholders.”

The decision was taken as government traverse a new path of transforming the economy from a mineral led economy to a knowledge based economy through the promotion of research and innovation. However, the facility will need major maintenance to be carried-out in order to meet the requirements of the proposed change in use.

“The work will include provision of laboratories, work stations, production areas and seminar rooms; audio visual centre, high speed internet connectivity, exhibition areas and offices,” reads the proposal note for the development.

These developments will be done through the refurbishment and maintenance of the main building, workshop, and ablution block, gate house, parking area, grounds, and access control and security service.

“There will be minimal modifications to the structure as it stands. The project is estimated to cost approximately P50, 000, 000,” says the report. In this regard, it is said, the initial scope of the OP facility will be modified to accommodate the envisaged digital technology research and development hub.

With funds needed to improve the building, OP has requested that; “the 2020/21 annual budget provision for Orapa House will need to be increased by P37,500,000 from P2,500,000 to P40,000,000 to kick start the maintenance works.” Funds will be sourced from the projects that have been delayed due to Covid-19 protocols during the 2020/21 financial year.

The building has been a thorny issue for government for years. Initially, OP was expected to move there but the move never materialised. At one point it was a question of whether the Office of the President and the Ministry of Finance and Economic Development were planning to override a decision by Parliament which rejected the proposal to buy Orapa House under the belief that government may be buying its own property. The building was to be bought at a negotiated cost of P79 million.

Again in 2012, Government had wanted to buy Orapa House for a negotiated P79m but the Finance and Estimates Committee of Parliament had rejected the request because of the inconsistencies realised in the supporting documents of the proposed procurement. The valuation of the building was put at P74 million.

The Ministry of Lands and Housing had initially offered De Beers P73, 000,000 as the purchase price. However, De Beers countered with P85, 000,000. On negotiation and converging of the minds, the selling price was finally agreed at P79, 000,000.

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Sad state of Brigades: dumped and ignored!

21st September 2020
Brigades

Auditor General, Pulane Letebele, has expressed discontentment at the worrying and deteriorating state of brigades in the country.

In an audit inspection which was carried out at Tshwaragano Brigade in Gabane, a number of observations showed weaknesses and shortcomings in the conduct of the financial affairs of the institution.

According to Letebele’s report, former students of the brigade had been engaged to carry out maintenance works on the school premises, comprising of painting, tiling, plumbing and electrical works, which covered the period from July 2017 to June 2018.

Although the agreed maintenance period had elapsed, the works had not been completed because of unavailability of funds and this situation had persisted up till the time of inspection in November 2019.

Auditor General says arrangements should have been made in time for funds to be available to complete these relatively minor works even before the works commenced.

Various contractors had been engaged for clearing the bush and for the supply of concrete stones, pit and river sand and hiring equipment for digging the trench towards the construction of an auto mechanics workshop, the report said.

It stated that the cost of services and supplies provided totalled P117 949.80. However, despite the services and the supplies having been paid for, the construction works had not commenced for a long period afterwards, resulting in the trench filling back in.

The audit inquiries had not elicited satisfactory responses as both the institution and the Ministry had not accepted the responsibility for the project, although orders for the provision for the supplies had been made. For their part, the Ministry had stated that they had sub warranted funds for the purchase of porta cabins.

Letebele indicated that it is therefore confusing that a project which is critical to the functioning of an institution such as this one would commence without a well-defined plan.

Furthermore, the accounting and maintenance of records for the supplies items were not of the standard prescribed by the Supplies Regulations and Procedures in that the supplies ledger cards, the main accounting records for Government assets, were not properly maintained for the recording of receipts and issues.

This had resulted in significant discrepancies between physical and ledger balances, while in other instances the supplies items had not been recorded at all.

The report says 24 of the 91 new computers found in the computer laboratory at Kumakwane ABC campus were not recorded anywhere, as were the other computers in the storeroom which could not be counted due to the disorderly storage conditions.

The institution had entered into a contract agreement with a security company for the provision of security services at Tshwaragano Brigade, ABC and Horticulture campuses at Kumakwane for a 2-year period which ended in June 2018, WeekendPost learnt.

After the contract expired in June 2018, an extension was granted till the 30th September 2018. Since then, there has been no security service coverage for the institution to-date. According to Auditor General, in the face of prevailing crimes, it is of paramount importance that government properties be protected by provision of security services at all times.

At Tlokweng Brigade, it was noted that the kitchen staff were working under difficult conditions as the kitchen facilities and equipment, such as the cold room, tilting pot, food warmers and solar power for hot water were dysfunctional. The kitchen roof was leaking and men’s restrooms was not working. All these need to be brought to a reasonable and functional state of repair.

The kitchen staff should use a purpose-designed Rations Ledger for the recording of receipts and issues of foodstuffs to reflect the usage of those items. As far back as 2014 the Department of Buildings and Engineering Services had found that the house occupied by the bursar was uninhabitable on account of structural defects, the report said.

A site visit during the audit had established that the house was indeed unfit for occupation as there were cracks on the walls, power switches were not working and the roof was leaking. On a sadder note, there were a number of finished items of clothing, such as dresses, shirts, and jackets from students’ practical exercises from the Fashion Design Textiles Workshop.

Auditor General shared her take on this, saying: “I have not been able to ascertain the policy on the disposal of products from these practicals. A trace of 103 green acid-proof overalls which had been purchased in August 2018 had indicated that there was no record of these items having been recorded or issued, nor were they available in stock. I was not able to obtain any explanation for this situation.”

Kgatleng brigade was also audited and inspected by Auditor General who observed that the brigade has 26 institutional houses at Bokaa, both old campus and new campus. Some of these houses are very old and dilapidated, with two declared uninhabitable. The condition of the houses is a clear indication of lack of care and maintenance of these properties.

At the time of the audit, there was no contractor engaged for the provision of security guard services at the new campus, after expiry of the previous one in July 2019.  It is hoped that steps would be taken to safeguard the security of the premises and government properties against any acts of hooliganism.

In August 2019, there was a break-in at the electrical and at the plumbing maintenance workshops and a number of high value items, such as drilling machines, bolt cutters, spanners and cables, were stolen. The break-in and theft were reported to the police.

“However, at the time of writing this report I was not aware of the outcome of the police investigation, nor of any loss report submitted in terms of the Supplies Regulations and Procedures,” Letebele said.

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