How Zimbabwe National Roads Administration bosses were let off the hook
Saved under Business, Corruption, Infrustracture, Legal Affairs, News, SOUTHERN AFRICA, Transport, Zimbabwe
Tags: Albert Mugabe, Auditor-General’s Office, Information for Development Trust, National Prosecution Authority, Obert Mpofu, President RG Mugabe, Public Accounts Committee, Public Finance Management Act, Public Private Partnership, State Procurement Board, Transport minister Joram Gumbo, Zimbabwe Anti-Corruption Commission, Zimbabwe National Roads Administration, Zimbabwe Republic Police, Zinara, Zinara CEO Frank Chitukutuku
The first part of this investigative piece done by The Standard in partnership with the Information for Development Trust (IDT) published last Sunday revisited the alleged Zimbabwe National Roads Administration (Zinara) corruption scandal in which the state institution acquired 40 graders at a cost of more than $8 million without going to tender, providing yet unknown detail about the controversial deal. This is the second part of the exposé.
The questionable acquisition of the second batch of graders, just like other forms of alleged corruption at Zinara, grabbed media and public attention. The Auditor-General’s Office, the State Procurement Board (SPB) and Zinara acknowledged that the extra 40 graders were acquired irregularly.
There was a serious breach of corporate governance principles and the Public Finance Management Act and the SPB Act and Parliament in its investigations suspected that the graders were overpriced in order to line individuals’ pockets.
Section 87 of the Public Finance Management Act provides that an accounting officer, authority or an employee of a ministry or public entity may be arrested for financial misconduct when an investigation proves criminality.
Yet relevant authorities failed to take decisive action against the evident flouting of tender procedures by Zinara. Then Zinara CEO Frank Chitukutuku resigned in the middle of the storm and was awarded his terminal benefits.
Since his departure, the former national roads authority boss has somewhat slithered off the public radar.
He was not subjected to any probe for presiding over the scandals at the roads utility and is now enjoying a new lease of life as the CEO at Farm Pride.
In fact, then Transport and Infrastructural Development minister, Obert Mpofu, expressed disappointment at Chitukutuku’s departure despite putting the administration under surveillance for suspected fraud.
Nor has action been taken against anyone from the Abdulla Kassim-led Zinara board which was dissolved in February 2014, and its successor that is currently headed by Albert Mugabe Jnr, a son to President Robert Mugabe’s late step brother.
The period during which Chitukutuku was preparing to leave coincided with what would seem like willingness on the part of authorities to deal with alleged impropriety at Zinara, but hardly so. The then financial director, Thomas Mutizhe, was suspended for alleged professional misconduct on November 27 2014 pending a hearing.
Our investigating team could not establish if Mutizhe appeared for the hearing due to Zinara’s reluctance to respond to questions. But he was subsequently offered a golden handshake that included paying off the former director’s outstanding house mortgage, a Land Rover Discovery and other perks totalling some $400 000, as indicated by state media reports.
Government institutions and departments have the mandatory obligation to act on and adopt corrective responses when red flags on corrupt tendering emerge. In the case of the extra 40 graders that were irregularly procured, these institutions raised the red flag: parliament, the office of the auditor-general (OAG), the transport ministry which is Zinara’s parent ministry, the Zimbabwe Anti-Corruption Commission (Zacc) and the Zimbabwe Republic Police (ZRP).
This is in addition to the Zinara board and its management yet no decisive action was taken.
Section 47 of the Procurement Act gives the SPB powers to annul procurements that are irregular. It also empowers it to condone contraventions or cause violators to rectify the anomalies.
SPB executive chairman, Buzwani Mothobi, said his board conducted its own investigations into the matter and resolved through PBR 0708B of July 2014 that the administrative violation of the regulations be referred to Zacc and the ZRP for further investigations.
“The review by the SPB was an administrative review of the procurement process that was limited to judging on issues related to corruption that were raised by the Parliamentary Portfolio Committee on Public Accounts in March 2014.
“In that case, it is now up to the enforcement agencies to establish whether the administrative violation of the regulations amounted to corruption,” Mothobi said in an interview.
On the other hand, the SPB granted Zinara condonation for flouting tender procedures, after the roads authority wrote to the board on September 4 2014, seeking to be condoned in line with section 26 of the SPB regulations.
However, the SPB admitted that condonation was not punishment but an administrative procedure to regularise procurement that would not have fully complied with the law.
Condonation sanitised the illegal procurement of the 40 extra graders and the deal will not be reversed.
This could have been helped by the fact that none of the competing bidders during the first tender of the 40 graders came forward to challenge the second contract at the Administrative Court or the SPB as provided under sections 42 and 43 of the Stare Procurement Act.
While the current SPB Act stipulates that the SPB is responsible for public procurement and its supervision, it was observed that the same entity could be the policeman, judge, executioner and accused at the same time and it would always be messy for it to supervise its own awards.
In order to ensure that monitoring and evaluation of all public procurement is done in the correct manner, a new Bill will be brought before Parliament (Public Procurement and Disposal of Public Assets Bill) to enhance the integrity of the process in the public sector.
While Mothobi claimed that the SPB had recommended that the grader tender flouting be investigated by Zacc and the ZRP, our investigations showed nothing happened. The Zacc commissioner currently in charge of investigations, Goodson Nguni, professed ignorance over the SPB recommendation that Zinara must be investigated for flouting tender procedures.
“I have never seen the recommendation that you are referring to. Maybe this happened a long time ago,” Nguni said.
A former Zacc commissioner who preferred anonymity and worked for the commission during the time of the Zinara grader scandal also said he was not aware of the recommendations.
“As far as I can remember, we never got any correspondence or recommendations from the SPB pertaining to the graders. We only read about the Zinara graders tender scandal in the media.
“This is not to say that the SPB did not do as it claims. The correspondence could have been misplaced. What matters, though, is that the matter was never brought up for adoption as a case needing investigation,” said the ex-commissioner.
Zacc does not necessarily have to wait for official correspondence before launching an investigation. It can still act on tip-offs from such sources as the media and is obligated by the Anti-Corruption Act (Chapter 9:22) to take action to promote honesty, financial discipline and transparency. Despite all the reported corruption at Zinara, Zacc steered clear.
The commission, instead, launched an exercise to probe Charles Kuwaza and senior management at the SPB for alleged corruption. The probe was aborted, said the former commissioner, because of interference by powerful members of the executive arm of government.
“The problem is that the corruption footprints of the executive and other members of the ruling elite are everywhere. The moment you start investigating as Zacc, you are stopped. There is so much manipulation of issues,” added the ex-commissioner.
Parliament’s Public Accounts Parliamentary Portfolio Committee has a leading role in assessing OAG audit reports, but, unlike in other countries, it does not sit together with the anti-graft body and the police.
The Auditor-General, Mildred Chiri, however, said in an interview that this must not hinder investigations by ZRP and Zacc. “Communication already exists between the Public Accounts Committee, the Zimbabwe Republic Police and the Zimbabwe Anti-Corruption Commission (Zacc),” Chiri said.
Chiri maintained that the OAG had done its job, digging up and exposing irregularities within parastatals through audit reports that included recommendations and were tabled before parliament which would then make follow-ups.
She said it was also the duty of law enforcement agents to make thorough investigations to establish if persons in concerned entities had broken the law.
Parliament, which began its investigations on Zinara before the AG had even tabled her 2014 audit reports on state enterprises and parastatals in 2016, has not yet recommended punishment for Zinara, investigations revealed.
The two committees that looked at the issue were the Public Accounts Committee (PAC) and the Parliamentary Portfolio Committee on Transport.
PAC chairperson, Paurina Mpariwa said her committee had not finished grilling Zinara over the issue of the 40 graders acquired unprocedurally.
“These (AG audit reports) were 2014 audited accounts on SEPs that were released early in 2016, and the committee has not yet summoned Zinara specifically to grill them on the issue of the 40 graders acquired unlawfully.
“The committee has a huge backlog of audited accounts of ministries and SEPs dating as far back as 2013,” Mpariwa said.
The transport portfolio committee washed its hands of Zinara. Its chairperson, Dexter Nduna, said the committee was “constrained” and could not further grill Zinara since they were not a post-audit outfit like PAC.
Nduna’s committee did not make recommendations on action to be taken against Zinara for the illegal manner they acquired the additional 40 graders.
“They appeared before us to be grilled on the tollgates and we ended up asking questions about the graders. They owned up to that they had not followed SPB tender procedures for the last batch of 40 graders, and they were punished for it through condonation.
“They went and got condonation from the SPB, which is an allowable form of redress of a situation that would have occurred,” Nduna said.
Bulawayo South legislator and a member of PAC, Eddie Cross, giving a personal opinion, said sterner measures like arrests should have been taken in the case of the Zinara scandal.
“It seems the (first) tender documents were drafted so as to restrict the number of companies to qualify to supply the equipment. Zinara had no right to extend the initial contract to another 40 units,” Cross said.
He said parliament must be enabled to call in the National Prosecution Authority (NPA) and Zacc to follow up on the graders tender scandal.
On June 16 2015, Zinara board chair, Albert Mugabe, appeared before the transport committee and claimed that the administration was carrying out its own audit of Zinara transactions. If the audit was done, it is still to be made public, and Zinara dodged questions on this and other issues for more than two months.
Mugabe promised to respond to some of the questions and to refer others to the Zinara management as he was not an executive chair. After numerous attempts to have to respond, he was reminded that Section 62 of the constitution stipulates access to information held by the State or any agency of government to the media as long as it is in the interest of public accountability. That seemed to jolt him momentarily, but he never responded.
Questions were also sent to Zinara management through their public relations department after they requested them in writing but they were not responded to.
And it is business as usual at Zinara. It keeps getting tenders, none of its executives have been brought to book and when Zacc tried in 2016, Vice President Phelekezela Mphoko stormed a police station where they were being detained and ordered their release.
The transport ministry seems content just howling about the irregular grader tender. Joram Gumbo, who took over the ministry in late 2014, admitted that Zinara erred.
“They have regularised the relationship through condonation that they sought from the SPB and were granted.
However, condonation does not take away the error from Zinara and Univern.
“It only tries to sanitise the situation so that they do not operate illegally. It does not necessarily mean that their actions were right. They were wrong and should have gone properly to tender,” Gumbo said.
In early 2016, Gumbo visited the Zinara premises and urged the administration to regularise the grader tender and its business deals with Univern, but did not demand the cancellation of the tender.
Cross, however, insisted the ministry must have punished Zinara for disregarding its advice and flouting tender regulations.
Our hands are clean, says Univern
Univern, the company accused of having an incestuous relationship with Zinara, has refuted allegations that its partnership with the parastatal is irregular.
A Univern representative, Musekiwa Khumbula (MK) told our reporter Obey Manayiti (OM) that allegations that his company was involved in a corrupt deal with Zinara were malicious and unfounded. Below are excerpts of the interview.
OM: Can you please explain your partnership with Zinara. How did it come into being and can you also explain the benefits of this relationship so far to both Zinara and Univern.
MK: We enjoy a transparent, professional, win-win public private partnership (PPP) with Zinara. The benefits to both Zinara and Univern include a dramatic increase in compliance and a substantial, defined increase in revenue.
The country has benefitted through the implementation and continued development of world class systems. We believe this partnership, which is mutually beneficial, is the best example of a successful PPP in the country.
OM: There are accusations that you supplied Zinara with graders with snow ploughs. What is your reaction to this?
MK: That accusation is preposterous. Zinara’s motorised graders have clocked more than 237 000 hours and graded more than 130 000km of rural roads network.
The graders are fitted with dozer blades which are essential for effective and efficient clearing of roads. We provide the requisite maintenance and spares to ensure the graders operate optimally.
OM: What is the logic of hosting the Zinara call centre on your premises? Does it not amount to a conflict of interest?
MK: The call centre is owned and operated by Zinara in conjunction with Univern, through the PPP arrangement.
Univern provides software and network support. The call centre is one of the most sophisticated issue management systems in the world, with a proven service delivery and track record to the country.
OM: Can you please explain how you ended up supplying 80 graders to Zinara yet the tender specifically said you must supply 40?
MK: We supplied 40 graders as per tender that we won transparently. After delivering the graders, which were commissioned by President RG Mugabe, we received a purchase order from Zinara for a further 40 graders under the same specifications and prices. And we duly delivered the second batch of the graders. All this was above board.
OM: In March last year Transport minister Joram Gumbo visited Zinara offices and raised concern over the Zinara/Univern deal and ordered the parastatal to regularise the partnership deal. What was wrong with the deal?
MK: Our partnership with Zinara is transparent and conforms to acceptable standards of PPP arrangements.