Transport ministry fails to account for millions

June 24, 2021

The auditor general’s office has revealed, in its latest report, that the Transport and Infrastructural Development ministry failed to account for close to US$8 million dollars meant for departmental projects in 2019.

Brenna Matendere

In  the report, which was presented to Finance minister, Mthuli Ncube, on 30 April 2021 and subsequently tabled in parliament on 14 June 2021, the auditor general, Mildred Chiri, noted that the ministry had transferred ZWL$657 500 000 (US$7.8 million) to the Infrastructural Development Bank of Zimbabwe (IDBZ) but could not demonstrate how the money was used.

The money was purported to fund more than 80 projects yet, during the year under review, the ministry—which was then under the late Joel Biggie Matiza—commissioned only two.

The IDBZ, a successor to the now defunct Zimbabwe Development Bank (ZDB), is meant to promote economic growth through infrastructural development targeting energy, transport, water, information communication technology and housing among other projects.

The infrastructural bank was supposed to facilitate the construction and rehabilitation of roads.

“I noted with concern that there was no evidence on how funds transferred from Ministry of Transport and Infrastructural Development to Infrastructural Development Bank of Zimbabwe (IDBZ) during 2019 amounting to $657 500 000 (US$7.8 million) were utilized as only 2 out of 85 projects were completed,” said Chiri in the report that covered the year ending 31 December 2019.

The failure to provide evidence on how the funds were used meant that the ministry contravened Section 29(4)(b) of the Public Finance Management Act (PFMA), Chapter 22:19.

In March 2020, former Zimbabwe National Roads Administration (Zinara) chief executive officer, Frank Chitukutuku, was alleged to have approved 51 fake contracts that prejudiced the organisation of US$39 million. He has a pending case in court and the state has forfeited some of his assets suspected to have been bought with ill-gotten funds.  

Chiri further noted that “there was no system in place to track on how funds transferred to IDBZ by the Ministry were supposed to be accounted for and monitored”, thereby exposing the ministry to financial abuse.

The ministry did not follow up with IDBZ on the project funds transferred to the bank.

In its response during the audit, the management at the ministry passed the buck to IDBZ, the report indicated.

“The actual payments made to various contractors and suppliers can be accessed from IDBZ as these were the managers of the projects,” said the management.

The auditor general warned that the ministry could be sued for failing to provide contract agreements relating to companies that were engaged to construct and maintain roads. The public auditor did not get the contracts during the review period and said the ministry acted in contravention of sections 80(3) and (4) of the PFMA.

The audit sampled five contractors whose projects were valued at ZWL$ 133 510 479 (US$1.63 million) for which no contracts were availed and “no evidence was availed for the payments of performance security deposits from the contractors.”

Chiri also found out that, during the year under review, the ministry recorded an excess of ZW$ 4 million (US$48,780) on its payroll for 2019, a development that could mean it paid ghost workers.

Turning to the department of roads, Chiri said there were no control accounts to account for a total of ZW$ 1 311 825 (US$ 15, 616) which was recorded as having been paid to creditors.

“There is risk that errors and omissions may go unnoticed hence the accounts payable amount may be materially misstated,” she said.

Chiri was also concerned by the ministry’s failure to present the auditors with the total amount of money spent on road projects.

Obert Chinhamo, the director of the Anti Corruption Trust of Southern Africa (ACT-SA), told Grazers News that Chiri’s report indicated that mismanagement was rife in public entities.

“The report has confirmed that most of the institutions are corrupt and this situation puts the country in a precarious position. The main challenge is that most of the recommendations are not implemented,” he said.

“Failure to take action against all those implicated by the auditor general undermines the government’s purported zero tolerance against corruption. It also means that we are not walking the talk against corruption,” added Chinhamo.

Economist Prosper Chitambara urged government to address the key drivers of corruption.

“What is needed is to address the key drivers of corruption which relate to a number of factors such as weak institutions and the low levels of wages. Addressing that should necessarily entail strengthening key institutions of accountability, especially parliament,” he told Grazers News.

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