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M108 million lost to MPs loan repayments

…as instability causes two-year parly terms

‘MAJIRATA LATELA

Public accounts committee (PAC) has recommended for a new law to ditch legislators’ loans guarantees having costed Lesotho’s ailing economy a whopping M108 million.

This amount, the government has spent in repayment of loans taken by members of parliament, senate and other statutory position holders after dissolution of the short-lived Eighth and Ninth parliaments.

The legislators and other statutory position holders qualified for M500 000 interest-free loans as part of the benefits, and were supposed to repay them over a five-year period.

The loans are issued by commercial banks with MPs paying a zero percent interest to the loans which government of Lesotho pays on their behalf and furthermore acts as their guarantor to the loans.

After the Eighth and Ninth parliaments hardly took half of their five-year terms, government as the guarantor to the loans had to step in as MPs feared defaulting and not only paid interest but also the remaining debts of the numerous borrowers.

In its report tabled in parliament today, PAC recommended that members of the parliament salaries (Amendment of schedule) regulation, 2019, all sections to statutory loans must be revoked.

“The minister of finance must bring the bill to parliament for repeal within 30 days,” the report reads.

The report shows that by the end of 2014/15, there was an outstanding balance of M31, 472, 844 for guaranteed loans to members of parliament, senate and other statutory position holders which were fully repaid by government in April 2015 after dissolution of the Eighth Parliament.

In the wake of an attempted coup by then army commander Lieutenant General Tlali Kamoli, prorogation of parliament after soured relations between Prime Minister Thomas Thabane and his deputy Mothetjoa Metsing, the Southern African Development Community brokered a peace deal that saw parliament dissolved to make way for a fresh election in 2015.

It continues: “Additional M617, 039 was paid as interest for these loans. The total that the government paid was therefore M32, 089, 883”.

The same repayment of loans for members of parliament, senate and other statutory position holders was done after the dissolution of the Ninth Parliament.

Ninth parliament was dissolved by the King acting on the advice of Prime Minister Pakalitha Mosisili after losing a vote of no confidence in the National Assembly of Lesotho.

The Vote of no confidence came at the height of internecine conflict between Mosisili and his then Democratic Congress Deputy Leader Monyane Moleleki who is now Deputy Prime Minister in Prime Minister Thomas Thabane led coalition government.

The PAC notes the outstanding balance of loans according to the Debt Section in the Ministry of Finance was M61, 345, 162.

However PAC has revealed that Auditor General pointed out that audited outstanding balance for MPs with Constituencies was different from the records kept by the debt section, showing an underestimation of M11, 081, 923.

“It was not only discrepancy; the total balance for the loans was actually, M72, 549, 200 according to the audit findings, not the figures provided by the debt section,” reads the report.

PAC further established that there is a serious doubt about the reliability of records provided by Debt Section.

Auditor General 2016 Report shows that two members of the National Assembly settled their loans in the total of M591, 777.

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