Zimbabwe could have lost an excess of US$10 billion to public procurement corruption in the past five years, according to estimates by Brian Dube chairperson of the Parliamentary Portfolio Committee on Public Accounts.
Loopholes in public procurement systems that allow for misinvoicing are being red-flagged at a time when the country is gearing towards attaining its vision of an upper-middle income economy by 2030 anchored on massive infrastructure projects which have to go through the tendering processes.
“The country has lost a lot of money,” decried Dube.
“For example, I will tell you from the agricultural sector only, we have lost over US$4 billion, and from the Ministry of Transport through the ZINARA ( Zimbabwe National Roads Administration) processes and all those flaws we have lost also a huge sum of money possibly a US$1 billion or over. We have also lost a lot of money from parastatals that have actually been run down as a result of these systems. In all our parastatals GMB (Grain Marketing Board), ZESA (Zimbabwe Electricity Supply Authority) and all others have also lost billions there. So in total, we can say in a period extending from plus or minus five years we have lost closer to possibly US$10 billion.”
In July 2020, at the height of COVID-19, President Emmerson Mnangagwa fired then Health and Child Care Minister Obadiah Moyo who was facing corruption and criminal abuse of office charges involving illegally awarding a US$60 million contract for the supply of personal protective equipment and COVID-19 test kits to Drax International – a United Arab Emirates-based company.
Following public outcry and criticisms from the opposition over the deal, the government was forced to cancel the contract which saw medical supplies being sold at inflated prices. However, the former minister was later acquitted of the graft charges after the High Court ruled in October 2021 that the charges against Moyo were unclear.
In another worrying incident, late last year, the Parliament of Zimbabwe almost bought 173 overpriced laptops valued at over US$9, 200 each, a deal which had been approved by responsible staffers at the institution, raising questions about the government department’s procurement processes.
The Zimbabwe Anti-Corruption Commission (ZACC) arrested Clerk of Parliament, Kennedy Chokuda in March this year following the awarding of a tender to a local privately owned company, Blinart Investments to supply 173 laptops to the august House with each gadget quoted at US$9,264.49. The contract was cancelled when the Ministry of Finance and Economic Development declined to process disbursement for the inordinately priced gadgets.
Responding to public outcry, Chokuda later issued a statement claiming he was the one who blocked the deal after realising the laptops had been overpriced.
However, Blinart Investments managing director, Elizabeth Muchenje justified the pricing of the laptops before the Parliamentary Public Accounts Committee, arguing they were high-end laptops with seven other accessories per laptop.
She said there was the HP Spectra 32GB laptop, Laptop Stand, Laptop Backup, HDMI Adapter, USB Adapter, Wireless Mouse HP, Laptop pouch, and Microsoft Professional Office 2019, hence the steep price.
Meanwhile, the trial of Chokuda and Parliament’s procurement director Stanley Bhebhe, who are facing charges of criminal abuse of office is set to resume on August 1 pending investigations.
To further suggest that procurement processes in Zimbabwe remain largely shrouded in secrecy the government on May 5 gazetted General Notice 635 declaring that procurement of certain equipment and services by the Health and Child Care Ministry were of national interest and must not be publicly disclosed.
Those comprised among other things, construction equipment and materials, biomedical and medical equipment, medicines and drugs (pharmaceuticals), vehicles including ambulances, laboratory equipment and accessories hospital protective equipment and repairs as well as maintenance services of hospital equipment and machinery. However, following a public outcry over the Statutory Instrument, the government quickly withdrew it with President Mnangagwa saying it had been issued without his authorisation.
Transparency International-Zimbabwe (TIZ), an anti-corruption organisation, believes shrouding public procurement in secrecy promotes wasteful expenditure of public resources. https://www.tizim.org/wp-content/uploads/2021/11/press-statement-Health-sector-Final.pdf
“TIZ takes this opportunity to reiterate to the Government of Zimbabwe on the need to remain alive to basic tenants of public procurement that are: transparency, accountability, fairness, and integrity,” said TIZ in a press statement.
“For TIZ, it is within the public interest that all procurement processes are subject to open and transparent public scrutiny and evaluation to promote accountability and fair bidding processes.
TIZ strongly believes that public confidence in the procurement processes is vital.
“Repeatedly the Auditor General’s reports have pointed out that there are increased corrupt practices that are inherent within the public procurement processes in most public sector institutions,” said TIZ.
“It is disheartening to note that most of the important observations and recommendations from the Auditor General’s audit reports remain outstanding, neither has there been any conclusive prosecution of high-profile corruption cases.”
In its May 2023 Public Resources Management Situational Report (SitRep) , https://zimcodd.org/wp-content/uploads/2023/07/MAY-2023-SITREP-1.pdf the Zimbabwe Coalition on Debt and Development (ZIMCODD) points out that the government continues to violate provisions of the Public Procurement and Disposal of Public Assets (PPDPA) Act on transparency, fairness, honesty, cost-effectiveness and competitiveness in procurement.
“For instance, in May 2023 the government announced a purchase of 32 helicopters from Russia to use for medical, air policing and search and rescue operations at a total cost of US$320 million,” says the report.
“The tender for these helicopters was not publicly flighted and the per unit cost of US$10 million is thrice the market price quoted by Rostec, a Russian helicopter manufacturer. Consequently, paying more for a good/service than its quality or availability just indicates a lack of value for money for taxpayers.
The ZIMCODD report further says: “Again, in 2022, the Treasury complained about the lack of due diligence in tender processes by government agencies. This explains the payment to suppliers by many local authorities for goods/services which never get supplied as evidenced yearly in the Auditor-General’s audit reports.”
Finance and Economic Development Permanent Secretary, George Guvamatanga has also told the Parliamentary Portfolio Committee on Public Accounts that many companies were fleecing the government by overpricing their goods and services, adding they were considering further mechanisms to protect public finances.
Dube, the portfolio chairperson said owing to a lack of transparency in the mining sector a lot of money continues to be lost through illicit financial deals.
“We do not know how much MMCZ (Minerals Marketing Corporation of Zimbabwe) and others have lost but the late former president Robert Mugabe indicated that we had lost US$15 billion. We can’t confirm or deny that because we have not done the audit in that sector to actually verify the figures but a lot of money has been lost.”
He further explained: “The issue is not about loopholes in the procurement systems but the inefficiency in the prosecution and punishment of those who have done wrong. So it motivates others to continue violating the law as long as you do not have those who have done it being punished effectively. It is actually the ZANU-PF tendency of making sure that those who violate the law are actually promoted and protected that has caused this chaos.” Parliament’s recommendations to arrest people and prosecute those found on the wrong side of the law, Dube said, continue to be ignored by relevant arms of the state.
“We just need to change the current attitude and behaviour in the government as well as the commitment towards making sure that we reinforce the laws,” he suggested as the solution.
“Of course, we may need to refine the laws like the Public Finance Management Act to actually tie up some loose ends but that is not the main problem.”
He added that there is a need to empower ZACC, NPA (National Prosecuting Authority), and the judiciary with the necessary resources to execute their mandate without any political interference.
Removing from office those employees who have overstayed in government departments and stopping all cash payments, Dube said could help in reducing corruption in the sector and save the country millions of dollars.
TIZ executive director, Tafadzwa Chikumbu, believes the leakages that have been identified over the years in public procurement are indicative of the corruption risks inherent in the system that needs concerted action from all stakeholders to tackle.
He was however quick to say: “There is not sufficient data for us to ascertain the amounts of money lost through public procurement processes, largely because, some of the deals are not documented and access to information in Zimbabwe continues to be a stumbling block for many CSOs and citizens. Most actors draw on estimations.”
To address the scourge, Chikumbu suggests that there is a need to rethink and redesign some of the country’s implementation approaches towards public procurement.
“Firstly, as much as the laws are existing, there is a need to ensure that implementation frameworks are adhered to and all the stakeholders are involved in ensuring transparency and accountability,” he said.
“Perhaps given the challenges Zimbabwe is currently facing, it will be ideal to start implementing an e-procurement system, institute regular capacity building and training for procurement officers in all the government departments, develop and institute a strict anti-corruption strategy specific to the public procurement institutional system and above all have a supporting political framework that hinges on strengthening institutions,” he added.
ZACC spokesperson, Thandiwe Mlobane said while accurate statistics on Zimbabwe’s losses to procurement corruption are not available, estimates for Africa alone are significant enough, adding the impact of such is felt at both institutional and national levels.
Lack of integrity in some individuals manning public offices, Mlobane said, was the root cause of corruption in public procurement, notwithstanding Zimbabwe has adequate legislation to safeguard against the practice.
“Corruption arises when an individual chooses to act against the purpose and obligations of his/her entrusted office to achieve personal gain or personal collective purpose,” she said. “Where an organisation has weak internal control systems, there is increased risk of procurement fraud occurring. In addition, where there is poor corporate governance and weak oversight, corruption in procurement is a high risk. The Public Procurement and Disposal of Public Assets Act provides guidance to public entities on how to procure goods and services competitively. The legislative Framework is adequate to provide guidance on public procurement.”
Despite allegations of capture by the powers-that-be, the anti-graft commission, Mlobane said was doing its best to combat corruption in the country including in public procurement.
“Through its Investigations Department, ZACC investigates all cases reported to it for prosecution by the National Prosecuting Authority (NPA),” explained Mlobane.
“ZACC also through the NPA investigates corruption for asset recovery to the State. To date, ZACC has forfeited to the State, assets worth USD29 million and arrested over 400 public officials on allegations of corruption including procurement fraud.”
Mlobane said the Procurement and Regulatory Authority of Zimbabwe (PRAZ) provides training for procurement officers as part of an effort to stem misinvoicing and other related corrupt tendencies in the field of public procurement.
“The Public Procurement and Disposal of public assets Act provides for oversight in the procurement process through the Special Oversight Committee (SPOC),” she said.
“ZACC introduced Integrity Committees to ensure that policies and culture of integrity and ethics are infused in public entities. In addition, ZACC is running a programme on the implementation of the Auditor General’s recommendations by all public entities so as to address any red flags that might have been identified by the Auditor General.”
This story was produced by Mandla Tshuma. It was written as part of Wealth of Nations, a media skills development programme run by the Thomson Reuters Foundation. More information at www.wealth-of-nations.org. The content is the sole responsibility of the author and the publisher.
