Wednesday, February 21, 2024

BGI, Botswana Life face pension mis-selling probe

In what threatens to be Botswana’s biggest pension mis-selling scandal, Botswana Geoscience Institute (BGI), is accused of conniving with Botswana Life Insurance Limited to mislead Lobatse based parastatal’s Permanent and Pensionable staff into investing in an ill-suited retirement plan.

Botswana Public Employees Union (BOPEU) last month petitioned the Non-Bank Financial Institutions Regulatory Authority (NBFIRAto investigate the standard of advice given by Botswana life Insurance Limited (BLIL) to BGI’s Permanent and Pensionable staff.

The BGI – BOPEU Interim Committee’s letter to NBIFIRA dated 12th April, 2021 however uses stronger language, “we are requesting your office as per the retirement Fund Act to commission an enquiry and an investigation into the unlawful establishment of a retirement fund by BGI management and BLIL management.”

NBIFIRA responded last week, acknowledging receipt of BOPEU’s complaint.

While their advice slips have for years been reflecting deductions towards pension contributions, BGI workers had the shock of their lives recently when they discovered that the state-owned institution does not have a pension scheme, but a retirement annuity.

In a happy work environment where staff has no qualms with being lifers, spending their careers with the same employer, this pension mis sell would not be much of an issue. But BGI is anything but a happy work environment. Sunday Standard investigations have turned up a long history of documented staff grievances which go as far back as former Permanent Secretary to the President, Carter Morupisi to as recent as the area Member of Parliament Thapelo Matsheka.

Aggrieved staff members who started their careers with Botswana Geological Surveys before it was turned into a parastatal as BGI are however stuck in their unhappy work stations because they cannot retire early and cash in 25% of their pensions to start their own businesses.

While a pension scheme allows workers to cash in 25% from their pot when they change jobs or retire early, a retirement annuity binds them to waiting until they reach retirement age before they can access their retirement money.

Sunday Standard investigations turned up information from BOPEU about BGI staff members who are so unhappy that some have been admitted to Sbrana Psychiatric Hospital after threatening to end their miseries by taking their own lives.

Sunday Standard can reveal that an employee who started with Botswana Geological Surveys 27 years ago with a promising future, sent to the United Kingdom for a Higher National Diploma course in Geology and later deployed at the North West Ngamiland Geochem Sampling as a technician, supervising more than 300 workers had a mental breakdown after he was downgraded to a casual laborer/ grounds man cutting grass and his salary slashed by 50% when Botswana Geological Surveys was turned into a parastatal as BGI.

The former footballer who is now battling high blood pressure and a falling marriage wants to break free from BGI, cash from his pension pot and start a business but cannot because BGI does not have a pension scheme. The BGI current annuity retirement plan does not give him that option. And this is not an isolated case, but part of a pattern. In another similar incident, a former Botswana Geological Surveys employee who was employed as a hydrogeology technician supervising Core Sheds was also downgraded to a casual laborer when the government department was turned into a parastatal. The employee who is also reported to be unhappy can also not cash from his pension pot because BGI does not have a pension scheme.

The Auditor General has been auditing the parastatal for years and is believed to have missed the pension mis-selling scandal because BGI misreported in its annual reports that it has a pension scheme.

Responding to a Sunday Standard questionnaire, BGI Board Chairperson, professor Motsoptse Modisi stated that, “many issues raised are part of matters still under discussion at BGI. The board feels that responding now would be pre-empting the outcome of such discussions at this point in time. Other questions touch on personal employment contracts which precludes such sharing with third parties.”

The story continues next week

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