- Says litigation is a factor in underspending
- About P64% of budget spent as at January
- Most of ministries have spent less than 20% of their development budget
Underspending of the development budget is a serious concern at Government Enclave, not least because it can play havoc with bookkeeping, the Minister of Finance, Peggy Serame, has said.
Addressing journalists at a press briefing in Gaborone this week, Minister Serame said the government’s financial year is drawing to an end but most ministries have so far spent less than 80 percent of their allocated development budget while some have used less than 20 percent of it. She named the Department of Administration of Justice, the Ministry of Labour and Home Affairs, Parliament, and the Ministry of Youth among those that have used less than 20 percent of their development budget.
“Generally, after we allocate the budget, the recurrent budget, which is the operational budget, we usually spend almost all of it,” Serame told journalists at a briefing on Wednesday. “Of course, we are still concerned whether we are really spending it most efficiently.” She added that the development budget has over time proved to be an issue. “In the 2022/2023 budget, I presented a development budget of over P16 billion. As at 31st January 2023, 65.4 percent had been spent,” she said Minister Serame said, noting that this translates into P10.7 billion.
With almost P11 billion spent in the last 11 months and weeks before the financial year closes, the finance minister said it is practically impossible to spend the remaining balance in the time left. “This worries us because it points to a number of challenges relating to project implementation,” she asserted. “Of course, we continue to refine our methodology, including establishing if we really include projects in the budget that are ready for actual implementation.”
She added that this raises issues of appraisal and prioritisation, and sometimes inaccurate costing. “Sometimes you would need P2 billion for a particular project when you could have budgeted for P1.5 billion,” the minister explained. “Not trying to name and shame, but just to indicate that in terms of the development budget, as at the end of January, there were only two ministries that have spent over 80 percent of their development budget,” she said.
The finance minister noted a number of issues leading to underspending. “One of them is that we believe we budget for projects that are not actually 100 percent ready for implementation,” she said. Another issue is that most projects under the development budget have to go to tender. “There is a good number of projects that end up in litigation and we have projects that have been delayed by up to five years,” she said.
“It is a concern that most of our projects end up in court. This is why in the new Procurement Act, we changed the law such that we do not in the process undermine implementation of development projects.” In addition, Minister Serame said a Public Procurement Tribunal has been set up to quickly deal with such disputes where they arise. She disclosed that her ministry is upgrading the Development Project Monitoring to assist in monitoring the performance of project implementation.
According to the Public-Private Partnership (PPP) Coordinator in the Ministry of Finance, Boniface Mphetlhe, the finance ministry is also taking steps to ensure that monitoring of projects is up to par by capacitating officers. “We have realised that it is not all our officers and project managers who have adequate skills in terms of contract management or even project management,” said Mphetlhe at the same press brifieng. “This will even reduce the number of litigations that we have if the contracts are managed properly,” he said.