06 Sep 2021

Legislators have rejected a motion that called for bailing out of Ngamiland farmers who were unable to repay the 2008 National Development Bank - Foot and Mouth Disease (NDB-FMD) Relief Fund.

The motion tabled by Ngami MP, Mr Caterpillar Hikuama, sought to highlight the losses, which farmers incurred when their cattle died due to drought.

Mr Hikuama said, as a result of the loss, farmers were struggling to raise enough herds to sell in order to repay the debt in addition to self-sustenance.

Mr Hikuama argued that Ngamiland farmers had been through a lot of disasters including severe drought and tick disease that affected cattle populations of 440 000 in Tubu, Gumare and Etsha, among other areas.

He further argued that of the 5 777 loans that were approved at the value of P105 million, there was an outstanding amount of over P51 million as only 1 827 were able to pay, while as at June 2020,  3 880 farmers still owed the bank.

In that regard, the MP appealed for leniency to farmers who borrowed the money but could not raise enough cattle to pay back NDB.

In his response, the Minister of Agricultural Development and Food Security, Mr Karabo Gare, said government would be setting a bad precedent to bail out Ngami farmers since many Batswana owed different forms of debt.

Mr Gare reasoned that following the advent of COVID-19, many Batswana were affected by the pandemic, hence the difficulty to only consider bailing out a small fraction out of many who battled with debts from Citizen Entrepreneurial Agency (CEDA), Youth Development Fund (YDF), among other government agencies.

He further argued that many Batswana were affected by bad debts including those in Selebi Phikwe area who depended on the mine for sustenance, but had since lost their jobs following closure of the mine.

Mr Gare stated that alternatively, individual farmers should request for a relaxed payment plan with NDB, instead of a bail out in that each one of them should state reasons for failure to pay the debt.

The minister also stated that government finance regulations did not allow for such.

MPs expressed divergent views on the motion and those for the motion argued that it was public knowledge that Ngami area once suffered a catastrophe, therefore government should consider some form of special dispensation for the farmers who were unable to pay while those who were against said all Batswana deserved consideration.

Maun East MP, Mr Goretetse Kekgonegile, supported the motion, arguing that it had good intentions given that Ngami farmers faced a peculiar situation than the rest of the country.

Bobonong MP, Mr Taolo Lucas also supported the motion, reasoning that for the past 13 years, Ngami farmers had not been able to pay because they could not raise enough capital with their cattle.

Mr Lucas said the over 3 000 debtors should be bailed out given the merits of their problems especially that Ngami was one of the top five poorest districts.

Tonota MP, Mr Pono Moatlhodi argued that it was a difficult task for government to consider bailing out only a small fraction of Batswana when many were battling with loans from government agencies such as CEDA and NDB.

Mr Moatlhodi said the fact that the money in question was a loan, should therefore be paid since it was not a grant.

Lobatse MP, Dr Thapelo Matsheka argued that bailing people out could lead to what was termed ‘moral hazard,’ whereby people would take debts knowing they would be bailed out.

Dr Matsheka said that could cause economic problems, adding that bail out was only considered for government parastatals and not individuals

Therefore, he argued that debtors should instead engage NDB about their failure to pay.

“One farmer at a time should seek audience with NDB and the bank should be in a position to assess each case,” he said.

Good Hope-Mabule MP, Mr Eric Molale also argued that rescheduling and compassionate grounds were considered by banks if individuals sought assistance.

He further said permission to write off the debt was in order given the reasons advanced and that NDB should be allowed to follow due process to reschedule or consider a write off to some farmers. A total of 34 MPs voted against the motion, 16 voted for it, while 14 were absent. ENDS