A. Corruption and Economic Crimes (Amendment) Bill, 2021
1. The draft Corruption and Economic Crimes (Amendment) Bill, 2021 (the “amendment Bill”) is a Private Members Bill tabled by Honourable D.L. Keorapetse (Member of Parliament for Selibe Phikwe).
2. The general objective of the amendment Bill is to transform the Directorate on Economic Crime from a government department into a statutory corporation (commonly referred to as a “parastatal”) such that it has a legal personality and is capable of suing and being sued.
3. The provisions in the amendment Bill therefore support this objective and follows common clauses used when creating a statutory corporation.
4. The Directorate on Economic Crime (the “Directorate”) was established by an Act of Parliament, the Corruption and Economic Crime Act (Cap: 08:05) (the “Act”, attached for ease of reference).
5. Section 3 of the Act establishes the Directorate as a public office, accordingly applying the Public Service Act (Cap. 26:01) to it, meaning it is a government department.
6. There are many policy considerations that are taken into account when creating a statutory entity, one of the pertinent questions being whether the entity is created as a private or public body.
7. These are as follows:
a. there is a policy preference to curb unnecessary proliferation of statutory corporations. Consequently, a function, activity or power should, if possible, be conferred on an existing department, or another existing government body, rather than on a new body.
b. when establishing a new statutory body, then its purpose, financial, legal and staffing status need careful consideration. It must be clear that there is need for statutory powers to be exercised by a body that is to a large degree independent of government. If functional or operational independence can still be achieved without the need for the creation of a statutory corporation then there is no need to establish one. There are many government departments set up by statutes like the Directorate which have operational independence so a distinction of why that should be departed from needs to be clear.
c. another key factor to consider is whether the statutory entity is income generating or not, the key question being, will the entity be able to sustain its own operations financially without reliance on the public purse? If the entity is going to fully rely on government for its financials then it might as well be part of government.
d. an assessment of the nature of the function of an entity is also carried out, is the entity going to carry out a regulatory, oversight, investment function, etc. All these functions can be undertaken by Government but if a policy decision is made by the Government to do so, they can be outsourced by setting up a corporate body, e.g. Botswana Development Corporation (BDC), or a statutory corporation, e.g. Water Utilities, Civil Aviation Authority, etc.
e. It is a critical decision to be solely made by the Government of the day as to which functions can and cannot be outsourced. The current policy position for Government is that most oversight authorities performing similar functions like the Directorate such as the Ombudsman, Financial Intelligence Agency, Office of the Auditor General, Fusion Agency, etc. are part of government albeit with operational independence.
B. Independence of the Directorate – form and function
The object of the proposed private member Bill is to make the Directorate more independent in form and function and thereby enhance its efficiency. 1. The Directorate is headed by a Director-General appointed under section 4(1) of the Act. Section 4(3) of the Act provides that the Director-General shall not be subject to the direction and control of any person or authority in making decisions or carrying out investigations under the Act. 2. This is a common provisions which exists for other oversight authorities (see section 51A(6) of the Constitution in relation to the Director of Public Prosecutions (DPP), section 124(5) of the Constitution in relation to the Auditor-General, section 4(4) of the Financial Intelligence Act (Act No. 11 of 2019) in relation to the Director of the Financial Intelligence Agency and section 4(4) of the Declaration of Assets and Liabilities Act, 2019 among other public offices created by Acts of Parliament.
3. As shown by the above there is really no justification to transform the Directorate into a statutory corporation as the Act provides for its independence in form and function.
C. Enhancing the efficiency of the Directorate The amendment Bill does not explain how the efficiency of the Directorate will be enhanced by transforming it into a statutory corporation or the inefficiency of the current set-up. There are many statutory corporations controlled by Boards but this does not necessarily translate into efficiency of function neither does employment of staff by governing Boards mean that the staff are or will be more efficient than public officers.
D. Public funds
The amendment Bill proposes that the new Directorate will be financed by money appropriated by the National Assembly and thereby be more independent, it is not clear how total funding by the Government creates independence or how this is different from the current set-up. In the current set up the Public Finance Management Act (Cap 54:01) applies and money is appropriated from the National Assembly for various ministries and departments annually through an Appropriation Act including the Directorate. The same financial reporting and accountability standards being proposed as enhancing independence are applied currently so there is nothing that changes the status quo.
E. Way forward The proposed amendment Bill should not supported because the current Government has the executive powers vested on it by section 47 as read with section 50 of the Constitution. These sections vest the Executive with responsibility to formulate and advice on Government policy. Unless and until a policy decision is taken by Government to transform the Directorate into a statutory corporation we need not support the amendment Bill. As part of the checks and balances required constitutionally, the Executive must first formulate policy and then consult the National Assembly. After the Government has made its decision as to what its policy position is with regards to the Directorate we cannot circumvent this process and force a policy position on it. This also denies other members of the National Assembly an opportunity to be consulted on and comment on the policy by tabling a Bill that already proposes a policy position.