10 Jul 2013

Parliament has adjourned the debate on National Development Bank (Transition) Bill following a motion by Tati East MP, Mr Samson Guma on July 9.

MP Guma said the debate should be adjourned as there were several issues that needed to be clarified before Parliament could debate the bill, which sought to privatise NDB.

The bill proposed to reserve 30 per cent of the bank’s shares to citizens only, 14 per cent to both citizen and non-citizen investors and five per cent to be allocated to NDB citizen employees through the Employee Share Ownership Plan. Government would retain the controlling stake of 51 per cent of NDB shares.

Mr Guma said he had reservations with the bill and was uncomfortable with its privatisation saying some people had accessed loans from the bank after they lost their cattle to Foot and Mouth Disease. However, he said he was not totally against privatisation of NDB.

Earlier, MP for Kanye North, Mr Kentse Rammidi said he was against the government holding a stake in the entity as it had to be attractive to investors. He said there should be corporate governance rules in place for investors to accrue maximum profits saying some people had been sitting in the NDB board for a number of years such that they were no longer able to come up with fresh ideas.

The Kanye legislator said he was also against the appointment of CEO by a minister. MP for Maun West, Mr Tawana Moremi said the NDB had become crucial to the farmers in the Ngami region after government assisted them to access loans on favourable terms.

He said his fear was that once privatised, the owners would be driven by profits hence in the end this might negatively affect the farmers. However, MP Rammidi made a clarification saying in such matters government could intervene whether the bank was privatised or not.

MP Moremi then said therefore it was important for government to retain a stake in the NDB. He said there should be safeguard in place to ensure farmers received assistance in the privatized entity.

For his part, MP for Gaborone Central, Mr Dumelang Saleshando said investors were weary of putting their money in government-owned entities as government did not always act in best corporate interest but there were always political considerations.

He said the ground rules were not yet available as a fund through which citizens could borrow money to invest in privatized companies has not yet been established. MP Saleshando further said there was no guarantee that the 30 per cent reserved for citizens would not be sold to non-citizens as there were no rules or plans on how to deal with fronting.

He further said it would be difficult for employees not to sell to the market as they would want to sell to the highest bidder who might be people not employed by NDB.

MP for Tswapong North, Mr Prince Maele said staff attraction and retention could be attained through the employee share ownership plan.

Mr Saleshando said still, employees would not be restricted to sell to fellow employees for less than the market value.

MP Maele said he was worried about the quota reserved for staff saying it would be diluted if employees are allowed to sell to non-staff members.

Gaborone Central legislator said the same could happen if employees resign or retire and remain holding their shares.

He said Batswana should be told that it shall be stated that 30 per cent shall be reserved for them at the time of listing. ENDS