The beleaguered Botswana Meat Commission (BMC) received a major boost from legislators appointed to investigate its operations, when they recommended that the meat company be allowed to monopolise the beef industry in the short and medium terms.
The Parliamentary Special Select Committee was set up to inquire into the operations of BMC and the decline of the Botswana beef industry. The findings of the Committee show there was no detailed marketing and market intelligence competencies in the Marketing Division of BMC to ensure an effective marketing of Botswana Beef, in the domestic and international markets. The findings, which were released this week recommend the retention of the statutory beef export monopoly of BMC in terms of Section 21 of the BMC Act (Cap 74:04) in the short and medium term to allow for a reinvigoration of the national beef sector, and the enhancement of the capacity of BMC to effectively compete in a deregulated and competitive beef export market in the long term.
The MPs also recommended that BMC stops operating the small livestock production sector, in order to open up commercial space and opportunities for small stock producers in Botswana.
The legislators say Agriculture minister Christiaan de Graaff and his Ministry have failed to execute and implement effective animal disease control monitoring, by the poor resourcing of the Department of Veterinary Services with the evident gaps identified by the O.I.E (World Organisation for Animal Health) report of 201l. Among the greatest weaknesses of BMC was the failure to operate a proper and efficient system of financial controls, which was “shambolic” during the years of its decline. Moreover, the BMC had four Chief Financial Officers in (CFOs) in five years. Financial controls must be strengthened and proper incentives provided for the recruitment and retention of competent staff.
The findings show that exclusive focus of BMC and MoA on the EU beef export market has increased the risk faced by Botswana farmers. It is also recommended that BMC introduce a comprehensive reform of the cattle transportation system to ensure greater access for small producers. The legislators say feedlot activities should be undertaken by the Batswana private sector and not by the BMC. At this point the BMC does not have the capacity to fulfil its core mandate of slaughtering cattle and selling beef.
It does not have the capacity for such an expanded mandate and this should be left to the private sector. The Committee recommends that an extensive review of BMC’ cattle purchase prices determination criteria be undertaken to ensure that it is properly implemented and reflects the revenue derived from beef exports to various markets and not just based on the South African Export Parity price. However, the abandonment of export parity constitutes a considerable risk for Batswana cattle farmers as without a specific formula farmers will become ‘residual claimants’ on the BMC revenues after the cost of inefficiencies are paid for as was the case prior to 2006 when EPP was initially introduced.
In yet another move that will soothe the hearts of farmers the Committee recommends that the Department of Veterinary Services (DVS) be transformed into a statutory and independent regulator independent of Ministry of Agriculture and to also enhance its operational capacity. Given the shift in EU policy the new authority should operate on a partial cost recovery basis but with support for low-income farmers.The Committee argues that the DVS needs to show greater flexibility in the application of SPS rules with particular holdings being permitted to supply particular markets, as is the case in other beef exporting countries. For example, feedlots that wish to supply South Africa only should be permitted to use SPS rules applicable to that market including the use of growth promoters. Similarly grass fed organic beef bound for the EU market should be similarly certified.
Such a multi-pronged and flexible approach would maximise the country’s export potential. They recommended that a reform of our national animal disease control infrastructure be made, including among other things, the establishment of cattle quarantines countrywide as part of an animal disease control and monitoring regime to be agreed upon with the European Union. The Committee also proposes that:
• Government should consider ways and means of mitigating possible adverse impacts on our national land tenure systems, through the increased zoning of national land into exclusive land user fenced farms, whose contribution to cattle production is woefully inadequate
• Consider ways and means of implementing constitutional and lawful land expropriation processes in respect of the large tracts of freehold land farms belonging to absentee landlords in the North East District of Botswana, for their use for increased cattle production for the benefit of the Botswana Beef Industry.
• Consider ways and means of creating a special cattle production enclave in the Chobe District by setting up of pastoral production farms through the conversion of some of the land currently utilised for game, to enhance beef production and income generation in the area.
• A special buffer zone be created through the establishment of a corridor of fenced farms along the boundary of the Botswana Zone 7 and Zimbabwe boarder, as a foot and mouth and disease control mitigation measure.
• Law enforcement agencies such as DCEC investigate the substantial allowances paid to BMC Board members in respect of board meetings held outside the country and ancillary allowances paid to them in the period 2006 to 2012.
• Conduct an investigation into the award and execution of feedloting contracts by Botswana Meat Commission during the period 2006 - 2012 to establish if members of the Board or BMC employees violated the law.
• DCEC investigate circumstances pertaining to the contract for the provision of expert financial consultancy services by Siva Ventaka Ponangi Subrahmanga Prasad (Consulting Unlimited) to establish whether the contract execution was tainted by any violations of the law.
• DCEC investigate the awarding of contracts for the Reticulum Bolus by the Department of Veterinary Services over the last decade.
• DCEC investigate BMC’s various land transactions.