Friday, June 5, 2020

How to waste tax payer’s money

Several government departments and some State owned Enterprises have a bad habit of wasting taxpayer money on asinine projects, and a new report by the Auditor General’s office shows that the costly trend continues, writes, SUNDAY STANDARD business editor – VICTOR BAATWENG.

The latest annual Auditor General report released just less than a month ago details page upon page of various ways in which government departments and State Owned Enterprises (SOEs) seemingly wastes taxpayer money each year, possibly adding to the current national deficit. Here are some of the most maddeningly useless government expenditure in the past financial years according to the report.

PALAPYE DPP OFFICE MOVE (P2 million)

The infestation of rats in 2015 at a building leased by the Department of Lands for the Directorate of Public Prosecutions in Palapye is not the only embarrassing big mess. Running away from the rats, the DPP has since spent close to two million Pula in rentals ÔÇô without necessarily occupying the new offices.

In his account of the audit of books and records at DPP ÔÇô Palapye, the Auditor General state that the Palapye DPP office was in an unhygienic and uninhabitable state because of structural defects and rats infestation which had impacted negatively on the comfort of the premises.

“This had resulted in the officers temporarily moving to the Palapye Police Station, leaving their documents and stores in the old building, pending their move to the newly acquired office accommodation. Although the new office accommodation had been identified and a 5-year lease signed, effective from July 2015 to June 2020 at the time of the move to the Police Station, the actual occupation took much longer than had been expected”, reads part of the Auditor General’s notes on DPP Palapye.

The Auditor General further stated revealed that an unnamed contractor who had been engaged to carry out the partitioning in the four months period to June 2016 at a contract price of P6 058 752, did not complete the works until  January 2018 with final cost of P7 281 369 ÔÇô half-way into the lease period. It has also emerged that the rental paid during this period was a whopping P1 834 450 without beneficial occupation by the DPP ÔÇô Palapye.

While the venture to run away from the rats was noble, the Auditor General questions the signing of lease of a building that was far from complete, and was to be occupied for only half of the lease period at such considerable cost in rental payments.

“….the Directorate had alternative, albeit temporary, accommodation”, said the Auditor General.

BOTSWANA POLICE PROPERTY LEASES (P1.2 million)

In finance world, a thorough consideration of value for money begins by officials clearly understanding and expressing the goals and purpose of the procurement. In April 2016, officers at Botswana Police Service leased blocks of flats comprising 236 housing units owned by an unnamed private developer in the Maruapula area in Gaborone. Subsequently, the Police officers then went on to make a proposal to purchase the said flats at a price of P364 million for which the Public Procurement and Assets Disposal Board approval was granted in December 2017.

In her account of the audited books relating to the said flats, the Auditor General says related inquiries had disclosed that the earlier lease had not followed the Public Procurement and Asset Disposal Act requirement of approval by the Ministerial Tender Committee. It emerged that the lease was only facilitated by the Department of Housing.

“The implication is that the process of acquisition of the lease, including the test of whether the rental was competitive, had not been properly evaluated and approved by the appropriate authority, as contemplated by the Act. It could therefore not be ascertained whether Government had received value for money on these leases”, state the Auditor General.

Still with the same law enforcement agency, in May 2017 an agreement was entered into with a private property developer for a 5-year lease of an office block in Francistown, at a quarterly rental of P299 880. Investigations show that as at August 2018, some 15 months into the lease period, the Police had still not moved into the office block.

“I am concerned that rental payments continued to be paid without beneficial occupation of the premises as this constitutes nugatory expenditure”, said the Auditor General ÔÇô Pulane Letebele. Letebele said that the explanation offered was the delay with the installation of a back-up generator.

BHC HOUSES ALTERATIONS (Unknown amount)

When it comes to basic take-home salaries, the pay gap between expatriates’ workers and locals remains unchanged, official labour statistics shows. Botswana’s salaries disparities first came to picture some ten years ago when a study commissioned by the then Ministry of Finance and Development Planning uncovered a pattern of bias in favour of foreigners in appointments to top management positions, salary payments and the award of government tenders.

The “Consultancy on the development of a comprehensive citizen economic empowerment strategy” by Tsa Badiri Consultancy, in collaboration with New Gx Capital of South Africa, turned up facts and figures showing that Botswana’s economic playing field is tilted against Batswana in favour of non citizens. While the Tsa Badiri Consultancy report was made public some ten years ago, it seems there is yet another disparity ÔÇô housing alterations. The auditor general office got shock of its life in 2018 when it discovered that institutional houses belonging to the Botswana Housing Corporation occupied by a team of expatriate doctors had undergone extensive structural alterations to meet the needs of those doctors. A physical inspection of the said houses showed that the alterations have substantially changed the structural character of the houses by inclusion of amenities such as gym rooms, in-door game courts and cross-bridges between the houses.

“I have not been able to appreciate the extent to which the needs and interests of the next occupants had been taken into account, given that these are institutional houses’, read part of the Auditor General’s notes relating to Nyangabwe hospital staff houses.

DEPARTMENT OF HOUSING (P1 million)

 Whether its money, time, or goods, theft by a public servant can cripple a sensitive economy like Botswana’s. This has however not stopped an officer at the Ministry of Lands and Housing who allocated himself 14 pool houses and sublet them, and thereby collecting a total of P805 900 in rental for his personal benefit.

The auditor general said that this happened between in the 2014 and 2018 and is as a result of weaknesses and other shortcomings in the management of these houses.

“While the case is being followed up for the criminal aspect, it has also been referred to Attorney General for assistance in recovering the fraudulently obtained money”, said Auditor General.

It is said that an audit inspection of the accounting records maintained by the Department of Housing on pool houses allocated to Government by Botswana Housing Corporation on rental basis had shown instances of weaknesses and other shortcomings in the management of these houses During the period under review, two instances of fraudulent use of pool houses had been noted.

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