Money – Finance & Strategy · Editorial

By Moakanyi Magazine · June 2026

Outsourcing was sold to African governments as a way to do more with less – hand cleaning, security and catering to contractors, keep the public payroll lean, pay only for the service. Botswana is now testing the other direction. In June 2026 the minister explained that bringing outsourced services back into government would improve job security and accountability while raising payroll costs.

What makes the statement worth reading closely is its balance. It names a benefit and a cost in the same breath, which is rare in announcements of public-sector reform. That candour is the story as much as the policy: it frames insourcing as a trade the state is choosing to make, not an efficiency it is claiming to discover.

The Case For Insourcing: Accountability And Security

The argument has two parts, and the minister named both. The first is the worker. Contracted staff often sit on short, insecure terms with thin benefits, frequently earning less than the in-house equivalent because the contractor's margin comes out of the same fee; folding them into government converts precarious contract labour into more stable public employment. The second is the state. When a service is delivered in-house, the line of accountability runs directly to the department rather than through a contractor whose incentives and margins sit between the public and the work.

Neither claim is exotic. The recurring complaint about outsourced public services – patchy quality, weak oversight, a contractor optimising for its own margin rather than the service standard – is the standard case for pulling them back in. Where a contract is poorly written or weakly monitored, the saving the state thought it was buying often evaporates into disputes, re-tenders and degraded service. What is notable is that the minister did not pretend the move is free.

Insourcing trades a contractor's margin for a state's responsibility – and its wage bill.

The Cost Side: A Heavier Payroll

Raising payroll costs is the part most reforms leave unsaid, and here it is stated plainly. Bringing services in-house means absorbing wages, benefits and pension obligations that previously sat on a contractor's books. For a government already managing a constrained recurrent budget, that is a real and lasting commitment, not a one-off. A wage on the public payroll is far harder to reverse than a contract that can be allowed to lapse, which means insourcing locks in a fixed cost for years.

The honesty matters because it frames insourcing correctly: as a choice about what the state should carry directly, not as a costless efficiency. The benefits – steadier jobs, cleaner accountability – are bought, not found. Whether they are worth the heavier payroll is a judgement about the value of those two things over time, and reasonable people will weigh it differently depending on how badly the outsourced arrangement was actually performing.

A reform that names its own price is easier to defend than one that hides it.

What It Means For Contractors And The Market

For the firms that have built businesses on government cleaning, security and catering contracts, the direction of travel is a warning to read carefully. If insourcing spreads beyond a pilot, a category of reliable public demand narrows, and contractors who depend heavily on state work will need to diversify toward private clients or specialise where the state cannot easily replicate the capability in-house. The contracts most exposed are the routine, labour-heavy ones; the most defensible are those requiring scarce skills or capital the government would rather not own.

There is a wider lesson for any operator who sells to the state. The outsourcing pendulum swings, and a contract that looks like an annuity today can be insourced tomorrow on grounds of accountability. The durable position is to deliver a service the state genuinely cannot do better itself, at a standard that makes pulling it back in look like a step down rather than a saving.

Public demand is a swinging pendulum; build for the swing back.

The deeper question sits beneath the line item. Insourcing redraws the boundary between what government buys and what it does itself, and that boundary shapes job security for thousands of low-wage workers and the quality of services citizens touch daily. Botswana's choice will be watched less for the payroll number than for whether the promised gains in accountability actually arrive once the contractors are gone – because if the in-house service drifts back to the same patchy standard, the state will have bought a heavier payroll and kept the old problem.

Sources: allAfrica