Monday, February 26, 2024

UDC’s Selebi Phikwe bailout bill takes shape

Chances of the bill passing are very, very slim but the Gaborone Bonnington South MP, Ndaba Gaolathe, has finalised his Selebi Phikwe Economic Bailout and Diversification Support Fund Bill.

Its backstory is what is now common knowledge. BCL Limited, a copper/nickel mine which has been the lifeblood of not just Selebi Phikwe but an entire region, has had to shut down on account of severe depression in the commodities market. The Fund that Gaolathe proposes through his Private Members Bill is part of plan to bring the town back to life.

In the language of the Bill, the Fund will provide for the capitalisation and recapitalisation of the government’s copper and nickel mining industry and its operations. It will provide the necessary support for the sector’s efficient operation and capacity enhancement as well as for the provision of economic bailout for the town of Selebi Phikwe.

A government-owned company, the Selebi Phikwe Economic Diversification Unit (SPEDU), has been set up to diversify the town and region’s economy away from copper/nickel mining. A fair chunk of the Fund’s money will go towards work that SPEDU has been set up to undertake and to a limited degree has undertaken. Gaolathe’s proposes that the Fund should provide the necessary financial interventions for the economic diversification of the Selebi Phikwe regional economy and fund accelerated road infrastructure projects for the promotion of the linkage of the Selebi Phikwe productive and manufacturing sectors to regional and international markets. He also proposes accelerated funding and promotion of the Selebi Phikwe regional water tourism and water sports infrastructure development; accelerated funding and promotion of the Selebi Phikwe regional fisheries and related agro-processing sector; and accelerated funding of the Selebi Phikwe airport project capacity expansion and upgrading.

Beyond bailing out a town that is now paling into ghostly form, the Bill redefines citizen economic empowerment in as fundamental a way as to possibly eliminate the corruption that now comes standard with virtually every disbursement of government money.

The authority to raise funds is vested in the Minister of Finance and Economic Development. The Bill proposes two methods: by supplementary appropriation of revenues the minister estimates to be sufficient to meet the emergent and exigent public need for expenditure and with the authorisation of parliament, by loan from any international development financier. Acting on the recommendations of the Fund Manager, the minister shall ensure that money from the Fund is “lawfully administered and applied.”

The Bill proposes the establishment of the Directorate to the Special Fund whose members shall be appointed by the minister acting in consultation with the Fund Manager. In addition to implementing the strategic plan, the Directorate shall receive and consider applications for the grant of facilities for investment. Such applications shall be supported by a detailed investment proposal and promote inclusivity and equity by including as beneficiaries, the mine workers’ union and other labour unions, cooperatives, communities, and Botswana citizens in general. In granting approval of a facility in respect of any application proposal, the Directorate shall do so in consultation with the minister. Thereafter, such approval shall be submitted to the Finance and Estimates Committee of the National Assembly. In the event the latter Committee approves any application, it shall subsequently submit its recommendations for the approval of the facility to the National Assembly for its final consideration and approval.

The following shall be eligible to make proposals to the Special Fund for the Grant of a facility for the purpose of equity participation and capitalisation or recapitalization of the government copper and nickel mining operations in Botswana: the Mining Development Company of Botswana, the Botswana Mine Workers Union, any Botswana labour union, any consortium of Botswana labour unions, any community trust of Botswana citizens of the Selebi Phikwe community; a wholly Botswana citizen consortium or pooled investment; a wholly Botswana citizen mining management company; any wholly Botswana citizen competent mining operator or mining company; and any Botswana citizen investor. The Fund Manager and executive appointees serving the Directorate shall have competence in any one or more of the following activities: financial structuring; industry and or business financing; management and business restructuring; economic stabilisation; mining and or the commodities sector; and environmental protection.

This role assigned MPs represents a complete break with convention because parliamentary oversight is never exercised in matters of this nature. In Gaolathe’s Bill, however, MPs have substantial say in how the Fund will be disbursed and there is no doubt that this particular provision will be fiercely resisted by the executive. In addition to MPs approving proposals, all the minister’s appointees to the Directorate “shall not enter upon their duties until approved by the Parliamentary Committee on Statutory Bodies and State Enterprises.” The Fund Manager and the Directorate shall not implement the strategic plan prior to its approval by parliament’s Finance and Estimates Committee and the Parliamentary Committee on Statutory Bodies and State Enterprises. The latter is the one chaired by Tati East MP, Moyo Guma, who has used the power and authority of his chair to haul ministers and CEOs over the coals at the public hearings of the Committee. The Bill proposes that the minister shall supervise the revenues of the Special Fund and shall ensure that a full account of the finances is made to the National Assembly annually for the period of the subsistence of the Fund.

Gaolathe says that the parliamentary vetting he is proposing constitutes the normal course of parliamentary oversight in relation with the work of the executive.  

“This would simply represent parliament asserting its role of keeping the executive in check with a view to bringing out the best in our system,” he says.


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