Water needs P165 billion cash, wastewater needs P5 billion
With Botswana’s dam sites almost exhausted, the Water Utilities Corporation (WUC) needs a whooping P170 billion to contain the water crisis threatening Botswana, WeekendPost can reveal.
In the recent past President Lt. Gen. Ian Khama had sanctioned the WUC to carry out a “comprehensive assessment of water and wastewater situation” in the country, and the results are nerve wrecking – vanishing water sources and huge financial implications.
According to the assembled report, which was then presented to not only Minister of Minerals, Energy and Water resources (MMEWR) but also to a full Cabinet last week, WUC conceded that “the water situation requires immediate attention and will need huge resources.”
A total amount of P170 billion is divided between water and wastewater interventions as well short, medium and long term solutions.
To ameliorate the water problem, the government will need P165 billion cash injection; while solutions aligned to wastewater will call for a total of P5 billion. Botswana’s budget as presented by Minister of Finance and Development Planning Kenneth Matambo this year stood at a sum of P50 billion, surely the country’s budget cannot finance the P170 billion figure hence the need for private involvement to take control of the water situation in the country.
In the 2015 budget, the largest share of the development budget was allocated to the Ministry of Minerals, Energy and Water Resources (MMEWR) at P3.32 billion or 25.7 percent of the budget. “This is meant to allow Government to continue to address the water and power issues facing the country by putting in place appropriate infrastructure,” reads part of the budget.
High placed sources at the WUC told this publication that efforts will be made to rope in the private sector to contribute to the water security situation in the country. “This is a developing process in the country,” one of the sources said. The WUC has advised that the Ministry and Government should consider partners in resolving matters such as Financing Infrastructure, introduction of Public Private Partnerships (PPPs) in the water sector; expertise in Project Implementation and Management; Robust operation and Maintenance; Job creation; and Citizen Empowerment.
Some of the top priority projects, North-South Carrier scheme upgrading works is estimated at P1.53 billion (funding available) and to be implemented from now till February 2017.
WUC is also embarking on the North-South Water Carrier 2.2 pipeline and associated works such as the Gaborone Wastewater reclamation plant and the Chobe/Zambezi Water Transfer Scheme at P66 billion and the implementation period is estimated at seven years but funds are not available. Other projects include Gaborone master plan, Lobatse Master plan, refurbishment of Mambo wastewater treatment works as well as Boteti southern and central cluster which will cost around P4 billion and will be executed over three years.
According to the report, other planned projects include National Water Loss Control Project, Letlhakane Wastewater, North East and Tutume Sub District, and Selibe Phikwe Serule Transfer Scheme which are scheduled to be implemented over a period of three years at a cost of P3 billion.
Reports reaching this publication suggest that Cabinet members were also reminded of key action points such as to “develop and enhance water governance – development of trade effluent agreement, development of the regulator, and enhancement of institutions.” Ministers were also informed that there is need to profile consumers against water quality required, e.g Agriculture and mining need less potable water for their operations.
In addition, “Reinforcing the culture of conversation and demand management is paramount. Huge consumers should recycle, e.g BMC, boarding schools, and, build water efficiency into building codes e.g all households to have rain water harvesting.”
The water situation report also analysed the 16 management centres across the country. The report looked at the national surface and groundwater sources against demand clusters prior to the 2008 water sector reforms. Cabinet was told that “only two management centres of Kanye and Lobatse are in a bad situation while Ghanzi, Tsabong and Masunga require closer monitoring – as their situation is also undesirable.”
Through a map, WUC illustrated that the Maun, Ghanzi, Lobatse and Kanye management centres have acute water supply deficit of more than 30%. “Basically the picture reflects extreme infrastructure deficits generally throughout the country.”
The report highlights that many parts of the country experience serious water loss ranging from 16% to 58% and these include parts of Tsabong, Kanye, Lobatse, Molepolole, Ghanzi, Maun, Kasane, Masunga, Serowe and Mochudi. The only areas that have acceptable water losses are Gaborone, Palapye, Francistown, Selebi Phikwe and Letlhakane management centres.
Records indicate that areas that currently have conventional sewerage systems are: Maun, Gaborone, Kasane, Ghanzi, Francistown, Selibe Phikwe, Tonota, Palapye, Serowe, Mahalapye, Shoshong, Bobonong, Mochudi, Mogoditshane, Tlokweng, Gabane, Lobatse, Goodhope, Jwaneng, Ramotswa and Orapa.
“Out of these only Gaborone, Francistown, Jwaneng and Selibe Phikwe have huge potential for reclamation.” However they need to be refurbished and upgraded to improve efficiency, it is noted in the report.
According to the presentation made by the WUC, Trade Effluent Agreements need to be put in place to ensure pretreatment prior to discharging into the system e.g Botswana Meat Commission (BMC), tannery, poultry, and textiles. Effluent currently being discharged into the environment should be further treated for re-use. It is understood that the total quantity that can be reclaimed from these systems is 50% as minimum of treatment plant capacity.
How North South Carrier could fail As at April 2015, the Gaborone dam was filled at a paltry 2.6% out of the 141.4 maximum capacity and has failed months of supply without inflow. Under normal circumstances, Molatedi dam (10ml), Bokaa dam (28ml), Nnywane dam (2.4ml), Ramotswa well field (5ml), Gaborone dam (74ml) and North-South Carrier 1 (60ml) make the total supply of 179.4ml to Greater Gaborone area. Gaborone peak demand is 145ml.
At present, excluding the Gaborone dam, the total supply of Gaborone water sits at 105.4 ml and therefore on a deficit of 39.6ml. In case, Masama East as a water source is included, the deficit will only be reduced to 19.6ml of deficit.
Moreover Gaborone water sources indicate that by 2016 the total supply of Gaborone water will be at 85ml with a deficit of 60ml. The water will come from Masama East, North-South Carrier, and the Ramotswa Well field.
It is also understood that without the North – South Carrier, by 2019 total available water will stand at 85ml hence a deficit of 112ml. Declining dam levels at Dikgatlhong and Letsibogo will lead to a failing North-South Carrier. Low or no rainfall will lead to Ramotswa not charging at all. But the general water situation will be determined by the amount of rain that falls over this period.
To achieve water security, a strategic shift is needed towards water demand management that both avoids future water shortages and keeps water affordable. Indications are that the available long term alternative is to use water from the Chobe Zambezi and link this with the North South Carrier as well as use water in the Nata River basin. However, both water sources are shared with other states, and the catch would be for Botswana to acquire consent of these countries, if the arrangement is to be carried through.
Botswana’s water demand is expected to be at 229 million cubic meters in 2020 and 286 million cubic meters in 2036. Demand is expected to outstrip supply in the near future hence water authorities are forced to come up with reasonable and plausible initiatives. Agriculture is the biggest water user in Botswana, accounting for 45 percent of all water used with the lowest productivity.
There is also going to be need for efficiency in water allocation – this could be implemented through the establishment of prioritized demand categories and quantities that are exempted for efficiency allocation process, and strict application of water efficiency guidelines to all other users.
Water lost through WUC supply system Research indicates that one quarter of all water supply in Botswana is lost through the WUC distribution system. Industry players recommend that this must be reduced to the 15 percent set by the WUC. But the biggest problem according to the WUC cashflow analysis is that there is no funding available to implement the National Water Loss Control Project.
To implement the Major Villages Network Rehabilitation and Land Servicing, WUC needs P150 million in 2015/16, P417 million in 2016/17, P475 million in 2017/18 and P400 million in 2018/19. In addition Water Pressure Zoning needs an injection of P500 million in the same financial years; while Distribution Storage Reservoirs need P750 million between 2015 and 2019 financial years.
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.
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.
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.