Boko’s Fiscal Path Takes Shape

Facing a fiscal deficit likely to be significantly wider than the forecast P8.7 billion and a populace eager for direction, the new Boko administration is taking decisive steps with an announcement of a forensic audit of past spending and a promise of “rigorous cost-cutting” measures.

In one of his initial statements upon taking office, President Duma Boko referenced Mark Twain’s notable quote: “There are three kinds of lies: lies, damned lies, and statistics.” The famous American writer’s remarks highlight how statistics can often obscure harsh realities, an idea echoed by others who stress that well-being cannot be measured solely by economic indicators such as GDP.

President Boko, committed to a human rights-driven approach to the economy, emphasizes the importance of enhancing the lived experiences of Batswana over merely achieving “appealing numbers.” His inaugural State of the Nation Address (SONA) on Tuesday exemplified this commitment, as he articulated his broader economic strategy aimed at “working together to build a robust economy and a thriving society, reinforcing the fabric of the nation for future generations.”

The SONA was notably sparse on detailed figures related to past or future spending, reflecting Boko’s philosophical stand. Nonetheless, the President announced plans for a comprehensive forensic audit intended to trace misuse and other wasteful expenditure from the previous administration. “I have heard your voices. I have seen your messages. You want to know where your tax money has been spent. We will find that out and report back to you,” Boko assured.

He emphasized that this audit is not meant to serve as a ‘witch-hunt’. “We undertake this probe not to vilify individuals but to examine the functionality and efficiency of our existing systems and institutions.” The need for a forensic probe is pressing, given that the public has not seen audited financial reports since at least March 2021. A downturn in diamond sales, compounded by uninhibited spending, has drained government reserves by billions of pula, prompting an increased reliance on domestic capital market loans.

The current system, Government Accounts Budgeting System (GABS), has proven inadequate, casting doubt on fiscal planning as those managing the economy have been operating in uncertainty. The previous administration’s term saw escalating reports of corruption, nepotism, and fiscal mismanagement. President Boko declared, “We will publish a comprehensive review of public finances to identify waste, corruption, and inefficiencies, followed by a plan for corrective actions.”

The new administration has plans to release a “State of Progress” report in February next year, detailing achievements, challenges faced, and plans for subsequent phases of transformation.

Vice President Ndaba Gaolathe, who concurrently serves as Finance Minister, elaborated on the budgetary measures being pursued. He announced that significant amounts of money are lost to mismanagement, neglect, and corruption. “The Ministry of Finance will at the appropriate time announce rigorous cost-saving measures,” Gaolathe stated.

These cost-saving strategies include restraining procurement expenses by establishing standard pricing for essential items and ensuring fair pricing for basic goods and services. The substantial P13 billion development manager model for major public infrastructure projects, including the Francistown-Nata-Maun road, will undergo review amidst indications of inflated costs.

Agricultural initiatives and agreements for rented government buildings are also subject to scrutiny to ensure value for money. The administration had promised to transform certain programmes from the previous era into grants, with Gaolathe noting, “The government is not paying market value for rented buildings.”

A comprehensive review of current budgets is underway to identify which expenditures are essential and determine whether existing projects should be state-funded or able to sustain independently. Challenges remain as the new administration takes charge amidst a tight fiscal situation and the end of the 2025-26 budget process, with budget requests already submitted by various governmental bodies.

Typically, the cabinet would be reviewing a draft budget memo by next month, but Gaolathe must first detail past financial expenditures while adhering to the budget timetable—a necessary step to maintain confidence among investors and citizens alike.

During this period, spending must be curbed, with public finance efficiencies set to be implemented in the following fiscal year. Also critical is monitoring diamond sales for an upturn to provide respite for public finances.

Batswana have high expectations for Gaolathe’s maiden budget due in February, eagerly anticipating witnessing the human rights-focused fiscal strategy. While statistics may be daunting, they will be a necessary component in articulating where past spending has led and the future fiscal pathways being charted by the new administration, balancing the task of being accountable to the past while looking towards the future.