Friday, June 21, 2024

MDCB’s Toby Frears feels the heat over his big-fat salary

If Member of Parliament (MP) for Tati East, also chairman of the Parliamentary Committee on Statutory Bodies and State Enterprises – Samson Guma Moyo was the appointing officer at the Minerals Development Company Botswana (MDCB), its Chief Executive Officer Toby Frears would be on the street by now.

The two men came face to face this week when Frears appeared before the Parliamentary Committee that cross examines accounting officers of State Owned Enterprises (SOEs).

As part of his questions, Moyo quizzed Frears on his appointment to the top post of MDCB. Frears told Moyo and the committee that he was head hunted by the former Minister of Minerals Resources, Green Technology and Energy – Sadique Kebonang. At the time, Frears said he was still working at another state owned entity – Okavango Diamond Company (ODC).

“If I had to powers and authority I would sack you and not because I hate you but because I have a problem with your management style and failure to deliver and mining is the core of the economy of this country,” Moyo told Frears to his face.

Moyo’s attack on Frears comes after the Parliamentary Committee raised concerns about the unsatisfactory performance of MDCB. Amongst other things, the committee says the state owned company is not fulfilling its mandate but with high costs which are linked to high remuneration packages of the senior executives.

The salaries of the executive management of Minerals Development Company Botswana (MDCB) including that of Frears were made public for the first time on Thursday after a tussle by the Parliamentary committee.

According to Frears, MDCB’s headcount is currently at 25 with a bulk of the money paid to the executives. The company’s pay structure shows that the Frears himself  is paid P364, 418 ( basic salary of P200,000, in addition to; P119, 175 in bundled allowances, P43,000 in currency insulation and P2000 for cell phone allowance.

Second on the list is the finance director who earns pay around P178, 223 being basic salary of P128, 750 plus P18,750 as housing allowance, P22, 500 for car allowance, P3750 for entertainment allowance, P800 for international allowance, P1330 for cell phone allowance and P2365 for medical aid). The total cost to the company of the Finance Director including gratuity comes has been estimated at around P216, 814 per month.

Other than high salaries, the Parliamentary Committee raised concerns about multi billions funds that were spent on the BCL liquidation adding up to P1.2 billion to date. There was also a concern on the unclear acquisition and transfers of government shares processes in mining companies.

In his response, Frears said under the provision of Botswana’s legislation, the responsibilities of a shareholder for an entity that is in liquidation are limited as the affairs of the estate fall under the liquidator who reports to the Master of the High court.

He said that following the 5th April 2017 instruction to halt asset transfers, MDCB was subsequently requested in September 2017 to propose redefined mandate and operating model. He said MDCB was informed that concerns had arisen that government’s influence and oversight of investments could be limited by transferring government’s mineral investment to MDCB, that there would be a disruption of strategic divided flows to government and that MDCB was becoming too involved in the operations of investees.

“The mandate remains under review to address the concerns raised and the company has not commenced work to fully develop the company’s strategic plan, operating model and structure,” said Frears.

He further stated that MDCB has commenced setting out scopes of work to define operational baselines of certain existing government mineral asst to be used in assessing investment performance against set benchmarks and investment objectives.

Quizzed on the return of assets, Frears said on account of the proposed redefined mandate potentially resulting in MDCB continuing to hold in the interest of MCM and with BCL in liquidation, only work relating to the transfer of the interest in De Beers Group has progressed. He revealed that MDCB envisages concluding the transfer back of the de Beers interest to the government by the end of the current financial year.


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