Fight over BPOPF billions
Earlier this year, a damning report compiled by the World Bank and Botswana Institute for Development Policy Analysis (BIDPA)revealed that the Botswana Public Officers Pension Fund (BPOPF)’s operating expenses were higher than those of private pension funds. BPOPF, which is twice the size of all private funds put together was not reaping economies of scale as its operating expenses were at 16 percent of contribution income compared to 14 percent for private funds. BPOPF also received bad press when consultants and fund managers fought publicly for a stake in its billions. The asset market industry also felt tremors when it emerged that one of BPOPF’s fund managers, with close ties to the African National Congress (ANC), was eyeing control of a larger stake in BPOPF billions.
Before that, Ephraim Lletebele a chief executive officer at BPOPF was dismissed under questionable circumstances amid allegations that he was against intrusion by government and ruling party functionaries in BPOPF operations. BPOPF insiders alleged that he was dismissed for refusing to toe the line and a new board of trustees that was deemed more amenable to government was appointed. The dismissed BPOPF boss later sued for reinstatement and damages of P2.7 million. The two parties settled the matter out of court. Towards the end of the year, another tussle broke out over re-election of trade union representatives on the BPOPF board of trustees. Trade union representatives, who had all along been fighting against a perceived take over of the BPOPF by government functionaries, raised alarm when suggestions were made for the old board to be allowed to sit pending finalization of the vetting process for new members.
Trade unions refused to budge and BPOPF was rendered comatose. A panic stricken BPOPF executive warned that such a scenario posed a serious risk to the Fund as there was now a governance gap. BPOPF is the largest pension fund in the country, with more than 150 000 members. As at March 2013, BPOPF’ s assets were valued at P38.7 billion and pensioner assets were valued at P32.9 billion.