06 Feb 2023

Government has proposed a developmental budget of P21.01 billion for 2023/2024 to invest in economic and social infrastructure necessary to support economic activities.

The development budget, which has increased 27.88 per cent over the 2022/2023 budget, will assist government to stay on track to achieving high-income status by 2036 and sustain livelihoods for most vulnerable groups.

In her 2023 budget speech yesterday, Minister of Finance, Ms Peggy Serame noted that consequently the largest share of the proposed development budget had been allocated to the Ministry of Lands and Water Affairs at P6.07 billion, or 28.89 per cent.

“The funds are for implementation of major water projects including the North South Carrier 2.2 project, which consists of a potable water pipeline from Palapye to Mmamashia,” she said.

Ms Serame said the budget would also finance, among others, the implementation of the ongoing Good Hope Phase 2.2 Water Supply Scheme, Molepolole –NSC (Gamononyane) Water Supply Scheme, Maun Water and Sanitation, Kanye network rehabilitation and Boteti South Central water supply scheme.

She said a small proportion of the budget would also be spent on completion of projects such as the North South Carrier 2.3, Lobatse Water Master Plan, Moshupa Sanitation, Selebi Phikwe-Serule Water Works, and Kasane-Kazungula Water Networks.

The proposed budget will also cater for land servicing projects at Ghanzi, Palapye Extension 10, Maun CBD, Mmopane Block 1, Kasane Plateau, Morwa, Pilane, Ntshinoge, Boseja, Letlhakane, Sowa Block 3 and Metsimotlhabe.

Ms Serame further indicated that the Ministry of Transport and Public Works had been allocated the second largest share of the proposed development budget amounting to P3.17 billion or 15.09 per cent.

Moreover, she said the budget would cater for the ongoing major road projects including; Output and Performance Road Based Contract of Mmankgodi-Jwaneng and Rakhuna-Mabule, Mulambakwena-Tshesebe, completion of upgrading of three Grades Intersections of the KT Motsete Drive at Btv, Rainbow and Game-City roundabouts; as well as final payments for Gaborone-Boatle dual road.

Ms Serame said the proposed budget allocation would also cater for the construction of some roads through either the conventional method or the Development Manager Model. The roads include Mmandunyane-Shashemooke-Borolong-Chadibe-Mathangwane, Mogoditshane-Gabane-Mmankgodi, Boatle-Lobatse, Palapye-Martins Drift, Nata- Kasane, Makalamabedi-Motopi, Nata-Maun reconstruction and Francistown-Nata reconstruction.

Additionally, she said the construction of Rasesa-Artesia and Palapye-Tonota roads would be undertaken through the PPP model.

The proposed budget also covers new projects namely Good Hope-Kgoro-Gathwane, Molepolole Bypass, Medie-Lentsweletau and Modipane-Mabalane, she said.

Other projects to be undertaken include airport maintenance and improvements of surveillance of Botswana airspace as well as Martins Drift Bridge, optimisation of the Dry Port in Walvis Bay and development of inland dry ports.

She said bankable feasibility studies would be conducted for Mmamabula-Lephalale and Mosetse-Kazungula railway lines.

Ms Serame underlined that the third largest share of the proposed development budget at P2.34 billion or 11.14 per cent was for the Ministry of Local Government and Rural Development for implementation of Social Protection Programmes including the revamped Ipelegeng and Remote Area Development.

She said the monthly wages for the Ipelegeng Programme would be increased from P651 to P701 for supervisors and from P567 to P617 for labourers, while old age pension would be increased by P100.

The fourth largest share of the proposed development budget at P1.87 billion or 8.90 per cent was allocated to the Ministry of Defence and Security, mentioning that the funds were primarily for provision of infrastructure, defence and communication equipment for the Botswana Defence Force, Botswana Police Service and the Botswana Prisons and Rehabilitation Services, she said.

The fifth largest share of the proposed development budget went to the Ministry of Minerals and Energy at P1.19 bn or 5.66 per cent.

The bulk of the funds, amounting to P500m went to Botswana Power Corporation with the view to cushioning the losses emanating from lack of cost-reflective electricity tariffs.

Proposed budget for the Ministry of Agriculture is P1.09 billion, while the Ministry for State President will get P1.01 billion and the Ministry of Communications, Knowledge and Technology is proposed to get P876.20 million.

The remaining ministries and departments, she said, would share the balance of P3.39 billion.

Ms Serame said the total cost of the Public Investment Programme in the Transitional National Development Plan was P64.07 billion over two years, including P29.97 billion in the first year of the Plan, 2023/2024, which was substantially more than the development budget presented.

She indicated that if it were feasible, including all of the Transitional National Development Plan projects in the budget would require an additional P8.96 billion  of borrowing in the coming financial year.

Ms Serame said as such a sharp increase would require government to pay higher interest rates on its borrowing, further threatening fiscal and debt sustainability.

She said the total revenue and grants for the financial year 2023/2024 were estimated at P79.79 billion, compared to total expenditure and net lending of P87.38 billion.

“This results in a budget deficit of P7.59 billion, or 3.06 per cent of GDP. 

It is anticipated that this budget deficit will be financed through a combination of financing options. 

The issuance of domestic government securities in the form of bonds and Treasury Bills, is anticipated to provide P3 billion,” she said. Ends