09 Dec 2013

The minister of Transport and Communications Mr Nonofo Molefhi has presented the draft Botswana Postal Services (BPS) (Transition) Bill, 2013; Bill No. 21 of 2013 before parliament for second reading.

Presenting the draft Bill, in parliament, on Wednesday, December 4, Mr Molefhi said the purpose of the draft Bill was to make provision for BPS to apply to the Registrar of Companies to be registered as a company and to continue existing as if it had been incorporated under the Companies Act.

He said, in 2009, government through the Public Enterprise Evaluation and Privatisation Agency (PEEPA) undertook a review of the 2006 strategy for the rationalisation of certain parastatals and public entities. The primary objective of the revised strategy, he said was to optimise utilisation of resources and improve efficiencies in the provision of services among parastatals and public entities through shared institutional services.

Therefore, he said a recommendation which government subsequently approved was made to merge BPS and Botswana Savings Bank (BSB) into a single entity with the capacity to provide public banking and postal services. The proposed changes, Mr Molefhi said affected the ministries of Finance and Development Planning and Transport and Communications, which he said had been directed to implement the recommendations , including making the necessary legislative amendments.

The merging exercise of the two entities, Mr Molefhi said commenced in the fiscal year 2009/10 with the intentions to conclude it the following financial year. However, he said the merger could not be concluded due to the delays in approving the requisite legislation, “one of which is the current Bill I am submitting for second reading.”

“Nonetheless, the merger process is now on course and is scheduled to complete during the fiscal year 2014/15,” he added.

Furthermore, the minister explained that the merger process required the repeal of the establishing Acts of the concerned two institutions and the enactment of transition laws that allows merging entities to continue trading while being converted into companies.

“The enactment of BSB (Transition) Act, 2012 commenced in July 2013 and allowed BSB to be converted into a company, a process which is ongoing,” he said.

However, he added that BPS was established as a commercial organisation of government, which is a less status than a body corporate. For that reason, he said BPS could not be directly converted into a company without elevating its status into a body corporate through a supportive legislation.

“Without a body corporate status, Clause 355 of the Companies Act prohibits its direct convertion into a company,” he added.

He also said the Clause, “only allows statutory corporation established as corporate bodies to transit to company status without winding up their operations.” Consequently, Transport and Communications minister said Clause 3 of the BPS Act was amended to confer the status of a body corporate onto BPS. During its sitting on August 16, 2012, parliament approved the BPS (Amendment) Bill, which confers status of BPS into a body corporate.

Therefore, for that reason, Mr Molefhi emphasised that there was need to enact BPS (Transition) Bill in order for BPS to transit into a company and to enable the merger process to be concluded as scheduled. ENDS