Sat. Jul 20th, 2019

Mahao’s golden handshake nothing out of this world: analysts say

BONGIWE ZIHLANGU

MASERU – Outgoing National University of Lesotho (NUL) Vice-Chancellor Prof Nqosa Mahao’s golden handshake which has raised eyebrows is justifiable as it is in line with international standards and his educational qualifications, analysts have said.

Last month, Mahao agreed to part ways with NUL after the two agreed on a M1 168 666.44 severance package for the Vice-Chancellor, who earns more than the King’s M56, 000 while the Prime Minister earns about M53, 000.

Mahao leaves office at the end of the month after serving as the ninth Vice Chancellor. He enrolled at the National University of Lesotho in 1978 where he completed a Bachelor of Arts in Law in 1982 and a Bachelor of Laws in 1984.

While a student at NUL he was President of the Student Representative Council, representing students in both the University Senate and Council.

Upon completing his studies, he joined the Faculty of Law after a short stint as a Research Assistant at the Institute of Southern African Studies.

He completed a Master of Laws degree at the University of Edinburgh and later a Doctor of Laws at the University of Western Cape.

Subsequently, he enrolled and completed a Postgraduate Diploma in Conciliation and Arbitration with a consortium of universities under the auspices of the International Labour Organisation.

Prof. Mahao has also undergone numerous specialised training courses offered by various universities and organisations.

Collectively the training opportunities equipped him with a range of critical skills in strategic envisioning, change management, staff motivation, business management, essential interpersonal skills, as well as the ability to make critical decisions and cope with stressful situations.

He has extensive managerial and leadership experience spanning more than 17 years having been Head of Department at NUL for two terms between 1996 and 1999 and Pro-Vice Chancellor at NUL from 2001 to 2003.

He has also served as Dean at NUL, University of North West, University of South Africa and University of the Witwatersrand.

He is widely published in constitutional law and jurisprudence.

Political and Economic Analyst Arthur Mokoena Majara told this paper that parastatals which do not get subventions and institutions of higher learning which do set their own salary scales with their boards and councils.

“Parastatals set their own salaries and they are huge because they can afford to. While I may not know who earns what amongst CEOs of such, what I can tell you is that they do not receive any subvention from government and are never allocated money by the Minister of Finance,” Majara said.

“I have been a member of boards of different institutions, such as Lesotho National Development Corporation (LNDC) and others, and all I know is that all parastatals such as Lesotho Flour Mills, do not get subvention from government at all.

“The only subvention they get comes in the form of government-guaranteed loans from financial institutions. They do not get any allocations as do government ministries and departments during budget appropriations,” Majara said.

Instead, Majara said bodies like LNDC and others generate their own income.

For instance, Majara claimed, the LNDC had its own assets and was a shareholder in, among others, Avani Lesotho Hotels, Lesotho Flour Mills, Maluti Mountain Brewery and also owned shopping complexes “from which it collects rent”.

“All the monies they collect from rent and dividends is all channeled towards its purse. That is the money they use to service salaries and other expenditures.

With LNDC, the government comes in in instances where it needs to fund development projects, by guaranteeing loans. Let’s take for instance monies used to develop Lesotho’s textile industry, looking at places like Thetsane in Maseru and Maputsoe,” Majara said.

“This is the money from their altruistic friends. But there are also interest-free loans they get from IMF, World Bank and others, which are channeled towards supporting LNDC’s immediate cash needs. Basically that’s what’s happening.”

He added: “That’s why they are able to pay themselves such huge salaries. Although all the monies they get is supposed to be used to increase their liquidity, they instead spoil themselves with unbelievably high salaries.

“The downside is that the owner of those assets, being government, does not get royalties at the end of the year as they declare small amounts of money because they have blown it on unnecessary spending.”

On institutions of higher learning Majara said while they also received funding from “friends”, their primary support was from government in the form of subvention, which he described as a huge percentage: NUL, Limkokwing, Lesotho College of Education, Lerotholi Polytechnic.

“They get huge funding from government. It’s a huge amount of money. It is safe to say they get money directly from government,” Majara said.

On the salary structures of tertiary institutions which differed starkly from those of government, the analyst said they should be different because those were entities established under the law, constituted bodies that were not part of government.

“Besides the subvention they get from government, universities like NUL also get subvention from other universities, altruism friends, NGOs and different bodies worldwide,” Majara said.

Their salaries, he added, should not be at par with those of the King or politicians such as the Prime Minister because if that was the case, the institutions would not be able to retain experts to teach.

For instance, Majara said, the level of a person with a PhD in Lesotho should not differ from one in Kenya, South Africa or the United Kingdom and that if there was a difference, it should be based on which university one studied.

“If one seeks a job in Lesotho, they would demand a salary similar to what they would get elsewhere in the world. That’s why even if someone from say the US is paid a salary similar to what they would get back home, the housing and other benefits in their package would be sub-standard. Eventually they leave because they are not satisfied,” Majara said.

Majara pointed to cabinet as an example of high salary earners who were also influential in terms of how salaries were set, saying academics’ salaries should not be on the same scale as politicians.

He submitted that the Minister of Finance Dr Moeketsi Majoro who holds a PhD, could not be paid a salary similar to a PhD lecturer at NUL because the lecturer is at par with international bodies and institutions of higher learning, whereas Majoro is a minister despite his qualifications.

NUL salaries, Majara said, were set by the institution’s council adding “they can pay whatever amount of money they want”.

“There is a law specifically for that, just as there’s a law under which the LNDC operates. All these parastatals have their own laws. That means there’s absolutely nothing shocking about Mahao’s severance package. It’s the same as in neighbouring South Africa and internationally, where heads of parastatals earn way above the head of government and cabinet ministers,” Majara said.

Retired MP Sello Maphalla, who served for three consecutive terms, said salary scales for institutes of higher learnings were set by the councils of the respective bodies, in collaboration with the Minister of Education and Training, who then present final decisions reached to cabinet.

The role of parliament, Maphalla said, was to allocate requested funds to the concerned ministry as a lumpsum and that it was each institution’s discretion how the funds were disbursed.

“Once an institution has submitted its needs to the minister and he/she approves, they then present to cabinet for justification. If cabinet approves, all that parliament does is rubber-stamp the decision by releasing the requested funding/subvention, usually during the allocation of the budget to different ministries,” Maphalla said.

“In the case of salary structures, institutions of higher learning set their own salary structures based on the nature of each tertiary’s needs.

“Thereafter, the minister of education will approve the draft and present it to cabinet. If it also approves, then the structure will form part of the annual budget. Like I said, parliament disburses a lumpsum to be broken down by respective institutions based on their need.”

Maphalla added: “Parliament has absolutely no say in such salary structures. It is between the ministers involved and cabinet.”

 

MAHAO SEVERANCE PACKAGE BROKEN

  1. Basic salary for month of June 2019   M72 874.00
  2. Salary adjustment by 5% from July 2019 for five months M76 517.00 per month

 

  • M382 588.50 for five months

 

  1. Total lump sum for six months from June to November M455 426.50

 

  1. Leave pay M232 169.05
  2. Gratuity M266 371.45

 

Benefits (part of the remuneration package)

  1. Official car (fuel for continued use) M40 208.00
  2. Water M9 500
  • Electricity M9 500
  1. Cellphone costs M12 639
  2. DSTV M5 418
  3. Cleaner M8 400
  • Gardener M7 800
  • Housing allowance @ 10% of salary M43 724.40
  1. Membership of Health Clubs M4 600

Other benefits (to be paid by NUL until November 2019

  1. Medical Aid M8 364
  2. Chauffeur: Basic salary M9 650
  • Medical Aid Benefit M2 450
  1. Housing Allowance M965

 

  1. Subtotal benefits M141 789.40
  2. Lump sum payment (subject to tax) M1 168 666.44 (M950 000 after tax) Lesotho News
Please follow and like us:

Leave a Reply

Your email address will not be published. Required fields are marked *

Wordpress Social Share Plugin powered by Ultimatelysocial