A budget for the ages: Time to change Botswana’s business plan :: Mmegi Online

0

This statistic has steadily deteriorated, with Botswana ranked among the most unequal countries in the world. Unemployment has steadily increased over the last 15 years to officially reach 24% (unofficially I guess if you remove Ipelegeng and other ‘internship’ programs you probably get close to 35% and maybe be even 45% to 50% if you only look at young people).

The COVID-19 pandemic has also pushed inflation through the roof, with no respite expected as oil prices continue to soar, the Botswana Power Corporation (BPC) continues to push for tariff increases, parastatals like the Botswana Housing Corporation (BHC) are raising rents and food prices continue to rise as incomes stagnate and cutbacks loom.

Botswana’s crown jewels of ‘free’ healthcare and education also continue to deteriorate as the government scrambles to fund the operating budget due to misguided decisions to grant pay rises to the public sector during a pandemic. Real economic growth is stagnant and everywhere you look, it seems like doom and gloom are on the horizon.

The reality is that Botswana is not what it used to be and the sooner we accept that the better.

That said, since the inauguration of President Mokgweetsi Masisi, he has championed big ideas like the National Transformation Plan (led by the National Transformation Team), transforming Botswana into a knowledge economy, accelerating Botswana into the fourth industrial revolution and introducing the reset program. . He also passionately pushed through the Economic Inclusion Act, advocated for more outcomes in specific special economic zones with the aim of accelerating citizen participation in the economy through value chain economic development and encourage policies that increase the wealth of indigenous Batswana. Much of this effort, however, has been dampened by the economic tailwinds the country has faced since the 2008 financial crisis.

This brings me to the point of this article (which is hardly original).

In the 2020 and 2021 budget speeches, the then Minister of Finance and Economic Development, Thapelo Matsheka, lamented that Botswana could not continue on the same course of “business as usual”. Botswana’s economic model is no longer sustainable. Some of the habits and luxuries that we have embedded in our working model during the Presidencies of Their Excellencies Ketumile Masire and Festus Mogae, and then stubbornly persist during the terms of His Excellency Ian Khama, need to be reassessed and padded to accept the Botswana in we now live in: a Botswana with a soaring government wage bill, unsustainable spending growth, declining government revenue, depleted foreign exchange reserves, growing national debt, growing corruption, wasteful shopping, low productivity and little or no real economic growth.

Therefore, the time has come for President Masisi’s ambitious proclamations of transformation to be reflected in the national budget. Here are some specific questions that I hope the Honorable Minister of Finance and Economic Development, Peggy Serame, will address during her speech on February 1, 2022:

1. Build a budget focused on clear priority areas that will promote the growth and competitiveness of the country as a whole. Botswana needs to re-examine itself and focus on the industries that bring the most value in terms of economic growth and employment; then put all his might of resources behind those. Emphasis should be placed on industries in which we have a relative competitive advantage over other countries, such as mining and tourism, and emphasis should be placed on creating chain economies. value around them. Funds should therefore be clearly focused on accelerating special economic zones such as Selebi Phikwe and Pandamatenga. Our budget should reflect job creation. 2. The budget must show a clear message of rationalizing expenditure. Measures to reduce the bloating recurrent budget must be taken and difficult decisions must be made. Can we continue to offer “free” education and health? Can we continue to run a welfare state with things like Ipelegeng and a whole host of other grants and entitlements? When do we start weaning Botswana off those rights and encouraging more cost sharing and then focusing our budget on productive goals that encourage economic growth and, therefore, increased employment? This should also include the rationalization of parastatals and ministries, as promised in the 2020 budget speech. This should not only be done to reduce costs, but also to update the mandates so that they are adapted to the goal, given the challenges we face as a country. Parastatals should not mirror 1980s Botswana (BHC, Botswana Savings Bank, Botswana Building Society, National Development Bank, Botswana Telecommunication Corporation Limited, I’m looking at you) but rather focus on specific business sectors of the times and the future. 3. The budget needs to start reflecting the value, ie showing the element of monitoring and evaluation. Previous speeches tend to omit what has been promised in the past. The government avoids self-assessment and instead focuses solely on future promises. Long-term narratives are therefore difficult to follow unless you consciously read national development plans, but what you will never get are progress reports and challenges. We also fail on the point of value where projects are chosen and undertaken without a clear assessment as to whether they have the greatest value for the general citizenry. For example, the Devil’s Advocate question: Who has the greatest economic value to the whole country? Deploy Internet fiber throughout the country or build a road between Dibete and Machaneng or Serule and Mabeleapudi? In the current system, it’s hard to answer one way or the other because we don’t have clear parameters to answer that question as a country. This cannot go on.

If we are to continue to provide hope for change, improved livelihoods, economic transformation and a culture of “reset”, President Masisi must change everything about the way we work. As we are about to embark on a constitutional review, it is important that we transform the way we plan, execute and monitor. This is not the Botswana of 2005 and we cannot behave as if it is ‘business as usual’ and the budget must be the first thing to reflect that.

*Mphoeng is a director at MP Consultants, a local citizen finance, economics and business consulting firm. Previously, he worked for the University of Botswana as a Lecturer in Accounting and Finance, Botswana Investment Fund Management (BIFM), Standard Chartered Bank and Bank of Botswana.


Source link

Share.

Comments are closed.