21 Aug 2024

The Public Finance Management Act of 2011 gives the minister responsible for finance the power to withdraw funds from any special fund if considered expedient or to be in the best interest of the public.

This was said by Minister of Finance, Honourable Peggy Serame answering a question in Parliament on Monday.

“Such act of authorising expenditure from any special fund for a purpose other than that contained in the written law or trust instrument establishing the Fund is done through an order, that is, Statutory Instrument,” Honorable Serame said.

In addition, she said the minister was also empowered by the Act if they considered a provision or balance in a fund inadequate, to issue additional regulations and provisions to support management and administration of the fund.

She told Parliament that there were 43 special funds of which 21 had been reviewed and aligned with the requirements of the Public Finance Management Act while 19 fund orders were under review and three were established this year.

She said a total balance held by the 43 special funds amounted to over P5.6 billion (P5 626 144 896.74) and their accounts had to be submitted to the Auditor General and Accountant General two months after close of each financial year.

She added that the Auditor General had audited the special funds up to the financial year ended March 31, 2022, except for four.

“It should be noted that the annual statements of accounts for the financial years ended March 31, 2023 and 2024 have not been finalised by the Accountant General due to system challenges, therefore the accounts relating to these periods are yet to be finalised and submitted for audit,” she said.

She said procurement for independent auditors was ongoing at respective ministries for the four special funds that have not submitted audit accounts.

“These are the Levy on Alcohol Beverages, audited financial statements have not been received since financial year ending March 31, 2019. The other are the Levy on Tobacco and Tobacco Products, Copyright and Neighbouring Rights (Levy on Technical Devices) Fund and the National Electrification Fund,” she said.

She further said subsequent to the emergence of the National Petroleum Fund (NPF) challenges in 2018, Cabinet approved four measures that ensured prudent financial management of special funds.

She said management of money in the special funds had been entrusted to the Bank of Botswana as government banker, advisor and fiscal agent.

The minister further said any monies accruing to the fund and not required for immediate use shall be invested in Botswana with interest from such investment accruing to the Fund, as international best practice.

On one hand, the minister informed Parliament that an amount of P2 billion injected into the COVID-19 Pandemic Relief Fund was drawn from 11 special funds.

She said the funds were drawn from Human Resources Development, Roads Levy Collections, Guaranteed Loans Insurance, Levy on Tobacco and Tobacco Products, Tertiary Education Development and Housing Revenue Stabilisation, Finance (Tourism Industry Training), Levy on Alcoholic Beverages, Road Traffic Fines as well as Tourism Development.

Selebi Phikwe West MP, Mr Dithapelo Keorapetse had asked the minister to update Parliament on the amount of money drawn from special funds for the COVID-19 fund seed capital, including how much government had spent from each fund.

Mr Keorapetse also asked the minister to state and explain the position of the financial law on management of special funds, the number of special funds and their current status and funds which had not submitted their financial statements for auditing since 2019. ENDS