- Opposition says Bidvest deal cancellation a political gimmick
- Transport operators warn Basotho of potential debt trap
OPPOSITION parties have dismissed the government’s termination of a controversial vehicle fleet services contract with Bidvest Bank Limited as a political gimmick meant to appease the electorate ahead of the 3 June 2017 elections.
In turn, transport operators have also warned of a potential debt trap for Basotho who take loans to buy vehicles for leasing to the government since the contracts would only be for one year.
Finance Minister Tlohang Sekhamane announced last Wednesday the cancellation of the controversial vehicle fleet services contract with Bidvest Bank Limited with effect from yesterday.
Government initially awarded Bidvest a six-month contract to run the government fleet from 1 October 2015 to 31 March 2016 after the expiry of the government’s fleet management contract with Avis.
The government had promised to exclude Bidvest from any new tender to find a new fleet management firm to replace Avis.
However, the government cancelled the tender process, preferring instead to enter a new long-term contract with Bidvest, which had not bid for the tender as earlier agreed in light of its enjoyment of the six month contract.
Then Finance minister Dr ’Mamphono Khaketla had said while announcing the deal in June last year that the government would buy 600 vehicles and hire another 600 from ordinary Basotho, with Bidvest only managing the fleet.
She also said the government decided to cancel the tender process because it did not have enough money to continue with the route of hiring vehicles.
However, a joint venture company, Lebelonyane, shortlisted for the tender took the government to court seeking an order to stop the government from engaging Bidvest.
The 48-month contract entered into by the government stipulated that Bidvest Bank Limited would provide “possession, use and enjoyment of the vehicles for the contract period” with the government only having the option to buy the fleet at the end of its contract.
The arrangement contradicted claims by several ministers that the government was buying 600 of the vehicles for its direct full ownership from the onset with the remainder being leased from Basotho.
However, the Bidvest contract clearly stipulated that the government would not “acquire any ownership rights of any nature whatsoever” of the vehicles despite being registered as “owner”.
The controversial fleet contract was one of the root causes of the split in the Prime Minister Pakalitha Mosisili-led Democratic Congress (DC) in November 2016.
A faction loyal to then DC deputy leader Monyane Moleleki accused loyalist of Dr Mosisili in the party of corruptly influencing the awarding of the deal in Bidvest’s favour.
Their ire was mainly directed at Dr Khaketla, whom they accused of disregarding due process in awarding the tender to Bidvest at the expense of joint venture company — Lebelonyane — that had been recommended for the contract.
Dr Khaketla, who was later reshuffled to the Foreign Affairs portfolio, has vehemently denied allegations of corruption and even sued some of her accusers for M6 million.
Mr Moleleki and his faction eventually left the DC to found the Alliance of Democrats in December 2016 after failing to oust Dr Mosisili from the helm of the party.
In his announcement of the cancellation of the Bidvest deal, Mr Sekhamane admitted that the South African financial institution had milked government of millions of maloti and the bills were spiralling to a point where it was difficult to pay them off.
However, the minister did not state the amounts owed and already paid to Bidvest.
Mr Sekhamane indicated that the government would adopt a new policy of hiring Basotho-owned vehicles with the contracts not exceeding 12 months.
He also said the vehicles must have mileage of not more than 30 000 kilometres, under a motor service plan and insured under a comprehensive insurance for the duration of the 12-month contract.
The minister also stated that applications from the following categories of people and their spouses or partners would not be accepted: ministers and deputy ministers, members of parliament, occupants of statutory positions, principal secretaries, all public servants at the level of director and above, chief executives, managing directors and all holders of equivalent positions in government enterprises and parastatals.
On the types and quantities of vehicles needed, Mr Sekhamane said the government required 973 vehicles made up of 147 Sedan 1.4l, 38 sedan 1.6l, four sedans 1.8l, 14 sedans 2.0l, 16 double cab up to 2500cc short wheelbase (SWB) 4×2, 720 double cab up to 2500cc SWB4x4, 32 single cab up to 2500cc long wheel base 4×4, two panel van-2 tonners.
On the payment of the vehicles, Mr Sekhamane said the 203 sedans required would each be paid at the rate of M14 322 per month, the 720 double cab 4×4 vehicles each cost M27 577 monthly, 32 single cabs 4×4 each cost a monthly M21 582, 16 double cab 4×2 each cost a monthly M19 184, while an unspecified number of trucks would each cost a monthly M44 363 and two panel vans would each cost M29 975.
However, opposition parties dismissed the new policy as a smokescreen to score political points for the seven-party coalition government ahead of the elections.
AD Secretary-General Mokhele Moletsane told the Sunday Express yesterday that the government’s volte-face on the vehicle fleet saga had vindicated Mr Moleleki on his claim that the Bidvest deal was a rip-off.
“We had always said through Ntate Moleleki that this deal was tantamount to the fleecing of our country’s finite resources,” Mr Moletsane said.
“In fact, we have lost millions to this scam already. Even before we had the escalated conflict that resulted in the formation of our party, we came out to say that this Bidvest deal with government was too exorbitant.”
Mr Moletsane said it emerged during some of the cabinet meetings he attended as Transport and Public Works deputy minister that Bidvest was overcharging the government.
He said it became clear that “a minister” had a personal interest in continuing the deal which was skewed in favour of Bidvest, without elaborating.
Mr Moletsane said although Mr Sekhamane’s admission was a “milestone”, the government’s policy shift was highly suspect.
“Basotho should punish Ntate Mosisili and his government for letting this daylight robbery take place, they need a harsh verdict.
“This policy shift is intended to deceive people into thinking this shall be very lucrative for them. We need transparency concerning what the minister is offering the public.
“He has not said how he intends to pay for these vehicles, especially because parliament has not approved the use of government funds.”
Mr Moletsane said the government should make it clear to Basotho that the new policy was not the short-term and commercial hire agreement they were used to where the proceeds were very lucrative per month.
“Where the talk is about long-term leasing programmes, there is nothing lucrative and the requirements are very complex. I wonder if our people will be able to meet the standards that the government requires,” he said, adding government was simply leading Basotho down the garden path where they would incur unsustainable debts.
Basotho National Party (BNP) deputy leader Joang Molapo also dismissed the government fleet policy shift as “hypocritical”, saying it was merely intended to gain political mileage for Dr Mosisili’s DC.
“This is not genuine. If they were genuine, they would have taken proper action a long time ago; instead they defended their decision to hire Bidvest.
“It’s a corrupt move on the part of government,” Chief Molapo said.
He claimed the policy could also be a ploy to gain access to vehicles for use at countrywide political rallies “and leave a huge debt burden to be shouldered by the next administration after the elections”.
For his part, All Basotho Convention (ABC) Secretary-General, Samonyane Ntsekele said before they left government in 2015, the ABC had come up with a clear policy to hire vehicles from Basotho “only for Ntate Mosisili and his coalition partners to discard it when they assumed power”.
Dr Mosisili’s DC formed a coalition government with the Lesotho Congress for Democracy, Marematlou Freedom Party, Basotho Congress Party, National Independent Party, Lesotho People’s Congress and Popular Front for Democracy on 4 March 2015 after the 28 February 2015 elections resulted in a hung parliament.
The seven-party governing coalition has since been toppled in a parliamentary no-confidence vote engineered by a four-part opposition bloc consisting of the ABC, AD, BNP and Reformed Congress of Lesotho. King Letsie III dissolved parliament on 6 March 2017 and proclaimed 3 June 2017 as election day.
“We wonder why they are seeking to implement something they should have implemented a long time ago now that we are faced with an election. We saw them disregard the huge public outcry when Bidvest was milking scarce government resources,” Mr Ntsekele said.
“We have it on good authority that the Bidvest deal costs had escalated to the point of tripling what we were paying when we were in government. We cannot be confident of transparency in what they want to do now, since it is coming during an election period.”
He also warned Basotho to be vigilant as the move was “merely about electioneering”, adding players in the transport industry had not been consulted over the formulation of the new policy.
Mr Ntsekele added that ministers who benefitted from the Bidvest deal could purchase vehicles and lease them to government which would falsely claim they had been hired from ordinary Basotho.
The Central, North and South Regions Transport Operators spokesperson, Lebohang Moea said he was shocked to learn of the government’s policy shift as they had not been consulted despite their status as major stakeholders in the transport sector.
Mr Moea said their members had always wanted to lease their vehicles to government but the latter had never shown any interest.
“The policy shift, which was hurriedly cobbled up during the election period, is highly suspect,” he said.
“It was announced a few days before its launch and the expectation is that we should have the vehicles already.”
Mr Moea said most of the envisaged beneficiaries would not have such amounts of money to buy vehicles on hand, and thus need to apply for loans.
“This policy is also faulty in that banks can only agree to grant loans to businesses or individuals if there is a contract that shows they will recover their money. But the minister talks about a one-year contract. This is a sham and we cannot be fooled into accruing debts by these people,” Mr Moea said.
He said a “few consultations” were made with the taxi operators prior to the Bidvest deal but these were quickly stopped when it became apparent that the South African firm was the preferred contractor.
“We ask ourselves whether this is being done to exploit unsuspecting Basotho, especially when parliament has not authorised the use of public funds.
“If we were to purchase vehicles that meet the high standards set by government, we would need to be paid from the first month of being engaged. “But there is definitely no spending approved by parliament. So this is suspicious,” Mr Moea said.