02 Apr 2014

The Minister of Labour and Home Affairs, Mr Edwin Batshu, says it is not his intension to review the current rate of severance benefits.

Responding to a question from Lobatse MP, Mr Batshu said the severance benefit payment did not protect an employee upon retirement since the funds received were in most cases utilized for immediate consumption.

“Consequently, my focus is on extending pension coverage to ensure protection of all employees upon retirement,” he added.

However, he said his ministry was carrying out a study on the feasibility of establishing a Broad Based Occupational Pension Scheme in Botswana with the technical assistance of the International Labour Organisation (ILO).

The proposed pension scheme, Mr Batshu said was intended to extend the coverage of pension to all employees in the private and parastatal sectors who were currently paid severance benefit or gratuity in accordance with Section 27 of the Employment Act, Cap. 47:01.

Furthermore, he said the draft report of the study from the ILO consultant had been discussed by the officials of his Ministry and the ILO, and he was waiting for the final report which was expected by the end of April 2014.

“As soon as the report is submitted to my Ministry, consultations with relevant stakeholders and Ministries will commence,” he added.

The outcome of such consultations, Mr Batshu said would be presented to government for consideration.

He added that “it will only be after government’s consideration that my Ministry will know with certainly whether or not the establishment of a proposed Broad Based Occupational Pension Scheme will materialize.”

Mr Nehemiah Modubule had asked Mr Batshu when he would introduce the new payment rate of severance benefits since the current rate had been in force since 1992. ENDS