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It’s time to reform our public financial system



HAVING agonized over time about the deterioration in the public financial management system in our country, I decided to write this paper as an opinion piece to share some ideas as we all frantically make efforts to tackle the demons that have stood in our path to economic development and prosperity.

Although I have worked as an independent consultant for the last twenty years, I continue to regard myself as a public servant because of the responsibilities that I have held and continue to hold in some of the state owned institutions, besides having joined the civil service as a Trainer in Accountancy at the Lesotho Institute of Public Administration some forty two years ago.

I still have vivid memories of my employment number and colleagues at the time.  After all, there were only eleven thousand of us in the entire civil service across the country at the time.  This background enables me to analyse and diagnose, from a position of independence and neutrality, the problems that the financial system in Lesotho has endured and is currently faces.

I also have to acknowledge that I am part of the professional accounting fraternity in the country, and in our exploration within that profession of the solutions to the problems that confront the public financial system; this opinion piece may just serve as a contribution within the broad-based reform process undertaken in the country.

Background and factors militating for change
Those of my generation will agree that there is an observable moral degeneration in the country. This is more so if one compares the standards and values that defined our behaviour as we grew up through both the education and employment systems, and what obtains now in the general society.

If we are to introspect a bit, we will all admit that wealth, and the accumulation thereof, has played an increasingly important part in earning people recognizable or even respectable places in society. There is nothing sinful about this.

But most regrettably, the materialistic urge has become so uncontrollably strong that it has assumed a higher importance at the detriment of the need to conform to the basic rules of conduct, especially in the manner that we interact with each other, and especially in handling public resources. That, in a nutshell, is the main point of focus in this article.

Respect for authority, which is a cornerstone for accountability, has been severely compromised.  People in positions of authority are often unable to apply the set rules strictly and fairly or to say anything about their ability to enforce discipline where the rules have been broken. This is because of the open defiance that they have to endure at times.

Respect for rules that govern the administration of public resources has been compromised to the extent that the propensity to override the rules has become a sub-culture. This is largely arising from abuse of the authority by those who have been entrusted with the stewardship role over the public assets.

One is able to make this point with a fair amount of audacity in view of the horror stories that have characterized the proceedings of the Public Accounts Committee (PAC) in the past year.

Listening to the litany of irregularities, outright theft and total disregard for the rules was so nauseating that I almost vomited.  My worry was not that these were not just isolated incidences which could have been easily corrected.

No! It was a general pattern of conduct across the public service.
What amazed me most was the courage with which those junior officers responded to the questions that were asked by the members of the PAC. From their attitude one definitely saw people who were not ashamed of things that they were accused of having committed, and the question that can be asked is how they could be ashamed when this pattern of behaviour cut across the spectrum of the public service.

The rot has deepened to a point where theft is no longer theft in the classical meaning of the word, and has long ceased to be a crime. These servants acted with such impunity because they are aware that nobody could take action against them.  Where there is a general laxity in discipline, nobody can expect anyone to enforce discipline.

In Latin they say: “memo dat guod non habet”, which simply means that “you cannot give what you don’t have”.  There is just no way that an ill-disciplined supervisor can take corrective action on a subordinate that commits an offence.

What we are dealing with here is an endemic disease that will take a strong antidote of correctional measures to rectify, and to the extent that we have allowed these habits to entrench themselves, it will take ages to turn the situation around.

Need to turn the corner – culture change
In spite of having faltered so much along the way, and having committed acts that cannot and should not make us proud, there is still hope that much that can still be done to salvage this country and to return it to its glorious past and place in the league of well-functioning economies, at least on the continent.

One has to applaud the process that has been set in motion to reform the governance system in its entirety in the light of the shortcomings that have given rise to the poor economic performance and especially the constitutional crises that hit us from time to time.

My biggest apprehension, however, is that this noble reform programme will not attain the intended results if it is not underpinned by a commitment to talk to our collective conscience as citizens to change some of the wicked behavioural tendencies which have been acquired and embedded in our routine life over the years.

Let us have the courage to face our demons and decisively deal with corruption, theft, poor discipline, conflicts and other societal ills. For this to happen we need to be taken, as a nation, through a structured process. In the next paragraphs in try to spell out how this can happen.

Culture change programs have been run and successfully implemented in organizations to cultivate new ethos and change of behavioural attitudes in staff as a way of unleashing their potential to improve their performance and service delivery standards.

This by itself would turn out to be a full-fledged project which would need to be run through a series of culture change sessions, to discuss and bring to the fore the real or perceived behavioural practices which should be corrected, and to obtain solemn commitment from all ranks of staff to adopt a new culture that places service delivery as the core objective that will improve the quality of life for Basotho.

This new culture should include a pledge by everyone to follow rules and procedures. It should emphasise the need for action to be taken by those who flout the rules.  Some people call this “consequence management”, and I like that phase because it is unambiguous.

What should be appreciated is in this instance is that there will be consequences where behaviour fails to reach the desired standards that everybody has subscribed to.  Yes, it will take a lot of courage from the ranks of the supervisors and Chief Accounting Officers to implement this but that is what they get paid for.

What we witnessed in the past year as people were hauled before the PAC to account and explain their actions must be applauded as a process of enhancing accountability and pricking their conscience about their duties as stewards to protect and account for the public resources.  That momentum should be maintained.

Of course we accept the fact that the work of the PAC is dependent on the report produced by the Auditor General, which has is lagging behind by two years.

Yet the point is that there is a record being created and from which we can start demanding answers from those entrusted with our national purse.
It is admitted that we need to move to a more pro-active regime where audit of transactions should not wait for the end of the financial year in order for reports to be produced.

This calls for the rationalization of the existing functions of internal audit and year-end audit to put them under one office that will be adequately resourced to carry out surprise checks and keep people on their toes.

The essence of this proposition is for the internal audit function to be beefed up and be placed, just for streamlining purposes, under the office of the Auditor General to provide assurance reports to the general public.  Audit is all about providing assurance to the stakeholders that things are under control.

Changes in the Institutional Framework
The Public Financial Management System can be functionally split into five areas: Planning (also known as Budgeting), Revenue Collection, Commitment and Expenditure, Reporting, Auditing.

The integrity of the system depends on all these components functioning properly. A failure of one of the components impairs the integrity of the entire system.

The creation of the Lesotho Revenue Authority (LRA) as a semi-autonomous and self-accounting unit can be singled out as a success story, judging from the gains that have been made in increasing the efficiency levels in the collection of taxes.

The trouble is that the collected revenue has generally not been put to proper use because of the leakages in the system, resulting often in huge losses. Because the expenditure side of the system is gravely wanting, the integrity of the entire public financial management system has been thrown into doubt. There is a general feeling— fed by ample evidence, that the whole system is not working for the good for the nation.

This will play itself out in a number of ways that will include reluctance of the citizens to pay tax and to comply with the voluntary compliance call made by the revenue authority.

It is in view of the above systemic drawbacks that a proposition is made in this opinion piece and consistent with the recommendations made previously from other quarters, for the National Treasury to be set up as an autonomous and stand-alone entity that will function along generally accepted guidelines of good and commercial accounting practice.

This arrangement will be in synch with the key internal control principle of segregation of duties that prevent the initiator of a transaction from being the executor of the same.

This arrangement will still retain and recognize the Chief Accounting Officers in their responsibilities to approve commitment of expenditures, but the actual disbursement will happen outside their sphere of influence to allow for the necessary cross-checking to occur so as to ensure compliance with the prescribed rules.

The business model contemplated above has worked well with the Millennium Challenge Account (MCA) in Lesotho and in other beneficiary countries, where a completely independent outfit is engaged to handle all matters pertaining to the custody and disbursement of funds.

Similar experiences have also been noted with the Lesotho Highlands Development Authority where approval of expenditure took place under a separate unit from the disbursing office.  The benefits to be derived from operating such a model and granting the National Treasury the operational autonomy could be matched to the gains that have been realized with the creation of the LRA. The MCA, LHDA and the LRA have shown that such a system works. The template is there for the government to follow.

Concluding Thoughts
It is my conviction that this scope of reforms can be initiated and implemented outside the amendment of the Constitution. It will however require the enactment of new legislation, especially when it comes to the creation an autonomous National Treasury.  But as far as I can see all other recommended processes can be handled within the existing legal and regulatory framework

Changing business processes goes along with changing the mind-set of the stakeholders, largely the public servants who have become accustomed to the current ways of doing things.  This is a paradigm shift that calls for all concerned to do things differently, and will need to be supported by a well-defined communication strategy to assure people of a better and more rewarding future as well as the benefits that will flow from the new arrangement. Who should drive this? Consideration should be given to selecting and establishing a team of Champions with a broad range of skills and experience to ensure that the necessary change management is effected properly.

l Bohloa is an accountant, a consultant and a businessman. He is also a member of several boards of directors of several companies and organisations.

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The Joker Returns: Conclusion



Last week I was talking about how jokes, or humour generally, can help get one through the most desperate situations (although it’s like taking a paracetamol for a headache; a much, much stronger resort is faith). I used the example of how Polish Jews, trapped and dying in the Warsaw ghetto, used humour to get them through day by day.

A similar, though less nightmarish, situation obtains in today’s Nigeria. Conditions there are less hellish than those of the Warsaw ghetto, but still pretty awful. There are massive redundancies, so millions of people are jobless. Inflation is at about 30% and the cost of living is sky-rocketing, with the most basic foodstuffs often unavailable. There is the breakdown of basic social services.

And endemic violence, with widespread armed robbery (to travel by road from one city to another you take your life in your hands) and the frequent kidnapping for ransom of schoolchildren and teachers. In a recent issue of the Punch newspaper (Lagos) Taiwo Obindo, Professor of Psychiatry at the University of Jos, writes of the effects of economic hardship and insecurity on his people’s mental health.

He concludes: “We should see the funny side of things. We can use humour to handle some things. Don’t take things to heart; laugh it off.”

Professor Obindo doesn’t, regrettably, give examples of the humour he prescribes, but I remember two from a period when things were less grim. Power-cuts happened all the time — a big problem if you’re trying to work at night and can’t afford a generator.

And so the National Electric Power Authority (NEPA) was universally referred to as Never Expect Power Always. And second, for inter-city travel there was a company called Luxurious Buses. Believe me, the average Lesotho kombi is a great deal more luxurious (I can’t remember ever having to sit on the floor of one of those).

And because of the dreadful state of Nigerian roads and the frequent fatal crashes, Luxurious Buses were referred to as Luxurious Hearses.

Lesotho’s newspaper thepost, for which I slave away tirelessly, doesn’t use humour very much. But there is Muckraker. I’ve always wondered whether Muckraker is the pen-name of a single person or a group who alternate writing the column.

Whatever, I’d love to have a drink with him / her/ them and chew things over. I like the ironic pen-name of the author(s). Traditionally speaking, a muckraker is a gossip, someone who scrabbles around for titbits (usually sexual) on the personal life of a celebrity — not exactly a noble thing to do.

But thepost’s Muckraker exposes big problems, deep demerits, conducted by those who should know and do better — problems that the powerful would like to be swept under the carpet, and the intention of Muckraker’s exposure is corrective.

And I always join in the closing exasperated “Ichuuuu!” (as I do this rather loudly, my housemates probably think I’m going bonkers).

Finally I want to mention television satire. The Brits are renowned for this, an achievement dating back to the early 1960s and the weekly satirical programme “TW3” (That Was The Week That Was). More recently we have had “Mock the Week”, though, despite its popularity, the BBC has cancelled this.

The cancellation wasn’t for political reasons. For decades the UK has been encumbered with a foul Conservative government, though this year’s election may be won by Labour (not such very good news, as the Labour leadership is only pseudo-socialist). “Mock the Week” was pretty even-handed in deriding politicians; the BBC’s problem was, I imagine, with the programme’s frequent obscenity.

As an example of their political jokes, I quote a discussion on the less than inspiring leader of the Labour Party, Sir Keir Starmer. One member of the panel said: “Labour may well have a huge lead in the polls at present, but the day before election day Starmer will destroy it by doing something like accidentally infecting David Attenborough with chicken-pox.”

And a favourite, basically non-political interchange on “Mock the Week” had to do with our former monarch, Queen Elizabeth II. Whatever one thinks about the British monarchy as an institution, the Queen was much loved, but the following interchange between two panellists (A and B) was fun:

A: Is the Queen’s nickname really Lilibet?
B: Yes, it is.
A: I thought her nickname was Her Majesty.
B: That’s her gang name.

OK, dear readers, that’s enough humour from me for a while. Next week I’m turning dead serious — and more than a little controversial — responding to a recent Insight piece by Mokhosi Mohapi titled “A reversal of our traditions and culture.” To be forewarned is to be prepared.

Chris Dunton

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Reading, writing and the art of reflection



There is a close thread that runs through what you reflect on, what you read and what sticks in your mind. It’s almost a cyclic process with regards to how all these processes unfold. Today, in this installment we focus on the thread between reading, reflection and writing.

This appears a bit cumbersome to explain. But let’s simplify it. Let’s begin with a beautiful poem which encompasses what we have so far spoken about. Here we are! The poem is penned by “Tachibama Akemi.” It goes:

It is a pleasure
When, rising in the morning,
I go outside and
Find that a flower has blossomed
That was not there yesterday.

Seemingly, the poem is simple. But, on close analysis, it reflects very deep reflection and thoughtfulness.

The persona, in an existential fashion, reflects all about the purpose and meaning of life and his place in the overall matrix of life.

The persona carefully reflects on nature. This is what makes all this poem rustic and romantic.

The persona thinks deeply about the blossoming flowers and how the process of the growth of flowers appears almost inadvertently.

It is a poem about change, healing, the lapse of time and the changes or vissiccitudes in the life of a person are reflected creatively through imagery and poetry. We all go through that, isn’t it? We all react and respond to love, truth and beauty.

So far everything appears very interesting. Let’s just put to the fore some good and appealing thoughts. Let’s enlarge on reading, writing and reflection.

Kindly keep in mind that thoughts must be captured, told, expressed and shared through the magical power of the written word.

As a person, obviously through keeping entries in a journal, there is no doubt that you have toyed about thoughts and ideas and experiences you wish you could put across.

Here is an example you can peek from Anthony. Anthony likes writing. He tells us that in his spare time he likes exploring a lot. And, more often than not he tells us,

“I stop, and think, and then when I find something, I just keep on writing.”

So crisp, but how beautiful. Notice something interesting here; you need to stop, to take life effortlessly and ponderously, as it were; observe, be attentive to your environment; formulate thought patterns and then write.

To some extent, this article builds on our previous experiences when we spoke at length about the reading process.

But how can you do it? It’s not pretty much different. I can help you from my previous life as a teacher of English Languge.

The most important skill you must cultivate is that of listening, close listening. Look at how people and events mingle.

What makes both of you happy; enjoy it. I am sure you still keep that journal in which you enter very beautiful entries. Reflect about Maseru, the so-called affluent city. So majestic!

How can you picture it in writing!

I am glad you learnt to reflect deep and write. Thank you very much. Kindly learn and perfect the craft of observing, reflecting and writing. Learn that connection. Let’s meet for another class.

Vuso Mhlanga

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The Joker Returns: Part One



Don’t be put off by the title, esteemed readers; what follows has nothing to do with the Batman films. As you will be happily (or unhappily) aware, I am a big fan of jokes. There’s a common understanding that a joke is ruined if you have to explain it, and this is true, but some jokes do need a bit of background explanation. Anyway. I like jokes and I like thinking about how they work.

Many of my favourite jokes have to do with language and the way we use it. For example: “I just bought myself a thesaurus. I similar it very much.”

Other jokes have to do with human behaviour and here it is important, out of respect for others, to avoid jokes that perpetuate stereotypical ideas about gender, race, nationality, and so on. I’m afraid the following joke does depend upon a stereotype (I’ll come back to that), but here goes, after a bit of background information.

In Lesotho you have an insect called a praying mantis — stick-like, bright green, and with great bulging eyes. They are rather lovable, despite the off-putting fact that the female practices insect cannibalism; after mating, she consumes the male. So, now you’ve had your zoological primer, here goes.

Two praying mantises are getting up close and personal. The female says to the male: “before we have sex and I bite your head off, could you help me put up some shelves?”

Apologies to female readers, because, as I said, that joke perpetuates a gender stereotype, namely, that women are good with a vacuum cleaner or a dustpan and brush, but hopeless with a hammer and nails.

There are many jokes that are, as it were, much more serious than that. As I rattled on about in a couple of earlier columns, many of these are satirical — jokes that are designed to point a finger at human folly or even wickedness. In another column, titled “Should we laugh?”, I explored the question “is there any subject that should be kept out of the range of humour?”

Well, apparently not, if we take on board the following account of the Warsaw ghetto.

Historical preface first.

The Warsaw ghetto represents one of the worst atrocities in modern history. In November 1940 the genocidal Nazis rounded up all the Jews in Poland’s capital and herded them into a small sector of the city, which they euphemistically, cynically, dubbed the “Jewish Residential District in Warsaw.”

Here nearly half a million Jews were in effect imprisoned, barely subsisting on tiny food rations. An estimated quarter of a million were sent off to the death camps. An uprising against the Nazi captors was brutally crushed. Around 100 000 died of starvation or disease.

Not much to laugh about there, you might say. But then consider the following, which I’ve taken from the New York Review of Books of February 29th this year:

“In the Warsaw Ghetto in October 1941 Mary Berg, then a teenager, wrote in her diary about the improbable persistence of laughter in that hellish place: ‘Every day at the Art Café on Leszno Street one can hear songs and satire on the police, the ambulance service, the rickshaws, and even the Gestapo, [on the latter] in a veiled fashion. The typhoid epidemic itself is the subject of jokes. It is laughter through tears, but it is laughter. This is not our only weapon in the ghetto — our people laugh at death and at the Nazi decrees. Humour is the only thing the Nazis cannot understand.’”

To be concluded

Chris Dunton

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