22 Nov 2022

Village Development Committees (VDCs) as community structures cannot borrow money from financial institutions as they are not autonomous entities.

Assistant Minister of Local Government and Rural Development, Mr Mabuse Pule told Parliament that, however, they may enter into contracts and transactions on behalf and with approval of the council as according to section 81 (2) of the Local Government Act, 2012.

Mr Pule highlighted that VDCs were legal entities established as per section 81 of the Local Government Act 2012, adding that they were governed by regulations and guidelines issued by the minister.

He further pointed out that VDCs could not sue or be sued as per the law, adding that they transact on behalf of councils, which itself could sue or be sued.

He said any considerations to transform VDCs into community based investment enterprises or any form other than what was currently prescribed by the local government (village or ward Development Committee) regulations 2014, would be considered in future.

Member of Parliament for Sefhare-Ramokgonami, Dr Kesitegile Gobotswang wanted to know about the autonomy of village development committees  and if they had any legal standing that allowed them to sue or be sued.

His question also included whether they could get loans from financial institutions and if they could be transformed into community-based investment enterprises. ENDS