Government has been called on to take back its powers to appoint the Chief Executive Officer of the Botswana Public Officers Pension Fund.
Without consulting the government, the Trustees usurped the powers.
This was against the spirit that all amendments will be made in collaboration with the employer.
The consultants appointed by the Registrar of the Pensions and Provident Funds have also come to the conclusion that asset managers in Botswana are charging exorbitantly high prices. To make matters worse, there is no uniformity or correlation in the structures of the charges by different asset managers even when providing the same service.
This has led to some analysts warning of pensioners being robbed of their pensions by the very people who are supposed to look after such investments.
Sunday Standard can confirm that in a confidential report to the minister of Finance, the Bank of Botswana last year also voiced concerns at the caliber and quality of some asset managers doing business in Botswana.
Botswana attracted all sorts of footloose asset managers after a decision by the government to establish the Botswana Public Officers Pension Fund.
The Fund, which has grown to close to P40 billion, has become a centerpiece of Botswana’s capital market, hence the attention of the Central Bank.
“The fees charged by the asset managers are not uniform but have been negotiated on an individual basis. As the fees charged in 2006 were P122 million, this is high and, hopefully, the new fees will be lower,” opines the Jacques Malan Consultants.
Furthermore, the consultants have advised that BPOPF should review its appointment of all its service providers.
“BPOPF should examine the offshore investments to establish if a more efficient basis can be reached rather than the current basis where there are over 40 offshore managers.”
BPOPF is also urged to “look at all fees for reasonability and renegotiate where necessary.”
“Botswana needs to write its own document on good governance for all funds in the country. In any event, due to the size of the BPOPF, it should write its own document that should apply until there is one for the whole of Botswana. The rules of the Fund need to be rewritten with the objective of replacing any new rules with the original rules where the Employer has been disadvantaged. Obvious changes are that the Employer should appoint the Principal Officer and no Rule amendment can take place without the agreement of the Employer. There should also be set a forum for the Fund and the Employer to meet to resolve each other’s concerns.