News / National
Ministry of Transport faces $7.56 million litigation
03 Jul 2017 at 01:48hrs | Views
THE Government is exposed to litigation by various creditors over a cumulative $7,56 million debt for services rendered to the Ministry of Transport and Infrastructural Development since 2012.
The chairperson of the Public Accounts Committee Ms Paurina Mpariwa revealed this in Parliament last week.
"The audit observed that the Ministry had unpaid invoices amounting to $7,56 million. There was no budget to clear the outstanding debts. As observed in previous audits, there was no system in place to monitor timely payment of creditors exposing Government to potential litigation by creditors," she said.
Ms Mpariwa said the then Permanent Secretary in the Ministry of Transport and Infrastructural Development Mr Munesu Munodawafa informed her committee that the ministry has been consistently discussing with Treasury to release funds to clear outstanding debts to no avail.
"In 2016, the Ministry was given $2 million to settle the outstanding obligations and for 2017, there is a budget allocation of $2,53 million. Due to tight fiscal space, the ministry indicated that Treasury had in situations where the ministry was facing litigation, requested Zinara to meet the ministry's obligations," she said.
Ms Mpariwa said the budget allocations for the Department of Roads were not taking into account the debts.
She said there is a risk that the Ministry would face litigation and Government would lose out more.
"It is also worrisome to the committee that the ministry continue to incur additional debts regardless of its indebtedness which is worsening the situation," said Ms Mpariwa.
The Public Accounts Committee also noted poor budgetary controls within the Ministry of Transport and Infrastructural Development.
It recommended that the Ministry should have engaged Treasury by August 31 on the possibility of taking over the long outstanding debts.
"Though the ministry indicated that payments were made on the first come first served principle, there were situations when those who were contracted late were being paid ahead of those who came in earlier.
"The Ministry said in such cases, there were threats of litigations. In the absence of a transparent system of paying creditors, this could be a source of corrupt practices," she said.
The chairperson of the Public Accounts Committee Ms Paurina Mpariwa revealed this in Parliament last week.
"The audit observed that the Ministry had unpaid invoices amounting to $7,56 million. There was no budget to clear the outstanding debts. As observed in previous audits, there was no system in place to monitor timely payment of creditors exposing Government to potential litigation by creditors," she said.
Ms Mpariwa said the then Permanent Secretary in the Ministry of Transport and Infrastructural Development Mr Munesu Munodawafa informed her committee that the ministry has been consistently discussing with Treasury to release funds to clear outstanding debts to no avail.
"In 2016, the Ministry was given $2 million to settle the outstanding obligations and for 2017, there is a budget allocation of $2,53 million. Due to tight fiscal space, the ministry indicated that Treasury had in situations where the ministry was facing litigation, requested Zinara to meet the ministry's obligations," she said.
Ms Mpariwa said the budget allocations for the Department of Roads were not taking into account the debts.
"It is also worrisome to the committee that the ministry continue to incur additional debts regardless of its indebtedness which is worsening the situation," said Ms Mpariwa.
The Public Accounts Committee also noted poor budgetary controls within the Ministry of Transport and Infrastructural Development.
It recommended that the Ministry should have engaged Treasury by August 31 on the possibility of taking over the long outstanding debts.
"Though the ministry indicated that payments were made on the first come first served principle, there were situations when those who were contracted late were being paid ahead of those who came in earlier.
"The Ministry said in such cases, there were threats of litigations. In the absence of a transparent system of paying creditors, this could be a source of corrupt practices," she said.
Source - chronicle
