Sunday, January 29, 2023

BMC finally pays farmers

Botswana Meat Commission (BMC) has finally utilized the P120 million which was disbursed to the Parastatal by government as a loan this year to pay farmers whose cattle were sold for slaughter.

BMC Chief Operations Officer Brian Dioka stated that when the loan was approved, BMC was owing farmers in Lobatse the sum of P12 million while in Maun, farmers were owed P7 million.

“Remember that we pay farmers 14 days after slaughter and we found ourselves owing farmers whose turnaround time had lapsed, so as soon as the money came in we addressed those we owed beyond the 14 day turnaround time. We needed to first deal with past due payments and we quickly liquidated those payments. I can assure you that in Lobatse we have paid all farmers and we do not owe any farmer while in Maun we have prepared cheques for everyone, it is just that since we are using cheques the process may be slow,” he said.

Dioka further said even though they continuously pay farmers who bring their cattle for slaughter, they will continue to be owed as they have to wait for the 14 days turnaround time to be paid.

He said cattle in Maun take 30 days to mature before they can be slaughtered and have farmers paid.

“When this loan was approved there were other creditors such as Water Utilities and others and we owed them close to P47 million but I can assure you that we have covered 95% of this debt and I must say that creditors are normally paid within 30 days turnaround time,” added Dioka.

He stated that even though the corporation has the responsibility to pay its creditors including wages it should be understood that just like any other organization they go through cash flow challenges which in most cases warrant them to seek financial assistance from either government or banking facilities.

In 2019 the corporation confirmed to this publication that it owed local farmers from across the country more than P160 million in delayed payments.  Some local farmers had already written letters of demand through their lawyers threatening to take the corporation to court should they fail to meet their demands.

This year, Botswana National Beef Producers Union (BNBPU) welcomed government’s decision to bail out BMC with reservations arguing that government’s subversions to the BMC are not sustainable.

They stated that BMC needed to be released to the farmers to own through a Special Purpose Vehicle where they can recapitalize through farmer contributions.

BNBPU challenged BMC to pay farmers within 2 to 4 days of slaughter.

The Minister of Finance Peggy Serame announced that government was aware that farmers were struggling because of delayed payments for cattle supplied to the BMC.

She stated that to alleviate this, government will provide loan funding to BMC from the public Debt Service Fund, up to a maximum of P120 million.

“This loan will be used for amongst other, enabling BMC to catch up on payment to suppliers, and to provide additional working capital. The disbursement of these funds to BMC will be subject to firm commitment by the commission to fulfil certain conditions,” said Serame.

RELATED STORIES

Read this week's paper