The upgrading of Botswana Meat Commission (BMC) in Lobatse is expected to begin in December this year, at a cost of P300 Million, Minister of Agricultural Development and Food security, Patrick Ralotsia has said.
Responding to a Parliamentary question this week, Ralotsia stated that his Ministry was planning to upgrade the Lobatse BMC as it needed urgent attention to meet standards required for an abattoir of its magnitude.
The upgrading, he stated, will happen in a period of five years in a phased manner.
“The total cost of the upgrading of the plant,that is, Abbattoir, Deboning and General Engineering, together with the cannery is estimated at P300 million,” Ralotsia explained.
BMC, which has for many years, enjoyed the beef export monopoly has been operating at a loss in recent years.In fact the Auditor General, Pulane Letebele has noted that, the ability of the Commission to continue is dependent on continued government support as it had accumulated a deficit of P770.12 million during 2016/2017 financial review. During the 2015/2016 review, the Commission’s deficit stood at P535.11 million.
“In the year under review ( 2016/2017, the Group and the Commission recorded a deficit of P222.52 million and P204.05 million, compared to a surplus of P334.09 million and P327.77 million respectively, reported in the previous year,” Letebele noted.
She further pointed out that the BMC group expenditure declined by 9 percent from P1 538.04 million in the previous year to P1 405.89 million in the year under review, while income declined by 36 percent from P1 872.13 million to P1 183.36 million during the same period.
Letebele added that, “the working capital position of the group as at 31st December 2016, showed total current assets of P226.00 million and total current liabilities of P247.46 million, giving a net current liabilities position of P21.46 million, while that of the commission showed current assets of P242.92 million and current liabilities of P305.49 million, resulting in a net current liabilities position of P62.57 million.”
However, Letebele noted that the current BMC group structure included a number of dormant entities, which gave rise to associated costs as they required production of statutory accounts and tax returns.
“Therefore a review is necessary to determine whether or not to liquidate them. In response management (during audit) stated that the process of review had been done since 2012 and some of the dormant subsidiaries were closed from 15 to the current 8. Furthermore, the Commission was working on restructuring,” Letebele revealed.
Just three months ago, government resolved to commercialise BMC as a business entity jointly owned by government and the farmers.