The government has embarked on an austerity programme without calling it one, by eliminating supplementary budgets, centralising procurement authority, and forcing ministries to live within their means.
At the centre of this shift is a strict enforcement of expenditure controls. For decades, supplementary budgets had become routine, blunting Parliament’s authority and weakening fiscal discipline. That practice has now ended. “Over the last two financial years, 2024/25 and 2025/2026, no supplementary budget requests have been approved,” Finance Minister Ndaba Gaolathe told lawmakers. “This marks a decisive break from past practices.”
The immediate effect has been a sharp contraction in discretionary spending. Government Purchase Orders, once issued freely across ministries, are now tightly controlled. After procurement authority was centralised in July 2025, average monthly GPO spending fell by 49 percent. The scale of the reduction suggests that a large share of previous expenditure was not essential.
This discipline is being applied even as economic conditions deteriorate. The domestic economy contracted by 2.8 percent in 2024 and remained weak in 2025, largely due to declining diamond activity. Under normal circumstances, governments respond to such slowdowns with stimulus. Botswana is doing the opposite.
The government insists that this is not a temporary freeze but a structural reset. “Fiscal sustainability cannot be achieved without disciplined systems, credible oversight, and a whole-of-society commitment to value for money,” Gaolathe said.
This discipline is being applied even as economic conditions deteriorate. The domestic economy contracted by 2.8 percent in 2024 and remained weak in 2025, largely due to declining diamond activity. Under normal circumstances, governments respond to such slowdowns with stimulus. Botswana is doing the opposite.
The reason lies in the erosion of buffers built during the diamond boom. The Government Investment Account has been run down to historically low levels, leaving little room for counter-cyclical spending. Net financial assets have swung deeply negative, forcing a reassessment of what the state can afford.
Rather than spread the pain broadly, the government has chosen to target process failures. Travel, overtime and procurement have been singled out as areas where discipline was weakest and abuse most likely. The logic is simple: before cutting services or raising taxes, the state must prove it can control itself.
Technology is expected to lock in these gains. A fully digital procurement system is under development, intended to replace manual processes that allow commitments to be made without funding. Once implemented, it is expected to strengthen governance and transparency across the public sector.
The approach is unusual in the region, where fiscal adjustment often arrives late and under duress. Here, the correction is pre-emptive and administrative.
