Business / Companies
NRZ faces collapse
14 Sep 2011 at 08:34hrs | Views
IN what could turn out to be an embarrassing failure for the shaky inclusive government of national unity, the sole rail transport service provider – National Railways of Zimbabwe (NRZ) is facing collapse after it emerged this week that it is broke and cannot manage to offer services, pay thousands of its serving and retired employees, widows and pensioners.
NRZ, which is one of the major parastatals accused of rewarding big chefs with hefty salaries and allowances that skyrocket to US$10 000 per month, at the expense of improving service delivery came clean this week before the Permanent Secretary in the ministry of Finance, Willard Nungo and his colleague from the Transport, Communications and Infrastructural Development ministry, Patson Mbiriri.
The two government officials were on a tour of NRZ sites that included Makati caution area near Somabhula and Dabuka Marshalling Yards just outside Gweru to gain an appreciation on how NRZ was utilizing the Public Sector Investment Programme funds availed to it, when they learnt of the dilapidated state of the parastatal.
Also in attendance during the tour was NRZ's general manager – Retired Air Commodore Karakadzai who mourned what has been done to save the railway company and described it all as a "drop in the ocean."
To save the crumbling NRZ, government has to invest a staggering US$2 billion, money which the treasury does not have.
The parastatal has to attend to its railway line, general service and payments to its serving, retired employees, widows and pensioners. NRZ is paying its pensioners that include highly-skilled accountants, train-drivers, artisans, managers and clerks a paltry US$17 per month.
Further the parastatal has reportedly failed to pay its van attendants and other workers their salaries for last month and the US$17 each for the 13 000 pensioners nationwide.
The pensioners have joined hands with NRZ widows who also cry foul over being neglected by the parastatal because of the latter's failure to pay them their monthly stipends.
They have accused NRZ of being "cold hearted" as the company has of late also failed to pay the NRZ widows their monthly stipends. The widows have instead been recipients of pay slips indicating that their monies have been deducted to the last cent.
Investigations done by Bulawayo24.com have revealed that the pensioners, most of them who have spent more than three decades working for the once heavily paying parastatal have resorted to vending, gambling and all sorts of money – hunting escapades to subside their upkeep.
NRZ Spokesperson Fanuel Masikati confirmed that the company was facing liquidity problems but those problems have had little effect on its capacity to pay workers and pensioners their salaries.
"We have had financial problems but those problems have not adversely affected our capacity to pay our workers and pensioners. Efforts are underway to address the problems through revamping the system and improving our service delivery," said Masikati.
Also – the NRZ Pensions Fund Chairman Louis Mukwada confirmed that pensioners earn a monthly salary of between US$17 to US$ 650 depending on their grades and positions during their tenure at the parastatal. "Our minimum is US$17 and the maximum is US$650 and that depends on the grade, position and number of years you had working for NRZ," he said.Mr Mukwada could however not be drawn to state which grade earns the US$650.
However pay slips of pensioners at hand who worked for more than two decades as train drivers and middle managers show that they earn US$27 and have a deduction of US$7 for Raimed ( NRZ's Medical Aid Scheme) – leaving them with a low US$ 10 to carter for their families.
Most of these pensioner's have a minimum of about between five and seven dependants – some have extended families. According to the Consumer Council of Zimbabwe mid-year living standards research, the average bread basket of a family of six is US$584.
The revelations come heavily after the Ministry of State Enterprises and Parastatals unearthed a scam showing that NRZ middle managers and other top brass members of the management were earning staggering salaries of between US$2000 –US$10 000 per month.
Said an ex-train driver Mr Agrippa Madlela: "We are in the dark about what NRZ thinks we are eating. I worked for more than 15 years and earn less than US$15 after deductions," he said.
NRZ is singing the blues because as early as January, the company failed to pay its salaries dating back to 2009.Then The Zimbabwe Amalgated Railway Workers Union (Zarwu) president – Charles Dube said the parastatal had only managed to pay workers in the lower grades half of their salaries for January and there "were no indications" as when they would get the remainder.
The upper grades also had no clue as when they would get their full salaries. "Our lowest paid workers get a minimum of US$80 per month," said Dube who added that the representatives of the workers met with the management on January 20 and the latter made an undertaking to solve the problem though noting that it might not be easy because of the parastatal's financial problems.
Railway Association of Engemen president, Norman Sibanda said the NRZ owes members of his union about US$4 000 since 2009 no date has been set for settling the debt.
State Enterprises and Parastals Minister Godern Moyo recently said government is considering opening up the railway network to private players. This he said after its was realized that the NRZ's monopoly is drowning in a ballooning US$ 274 million deficit of depleted fleet and recapitalization costs.
A committee comprising of officials from the State Enterprises Restructuring Agency (SERA) , Ministry of Transport and the NRZ board was set up to formulate viable strategies to resuscitate the ailing sector.
NRZ's service delivery has been in decline over the past decade, from a capacity of 18 million tons per year to down only 5,3 million tones. The embattled parastatal is left with 33 functioning diesel and one electric locomotive out of more than 62 and 10 respectively. About US$ 750 000 and US$20 00 is required to refurbish each locomotive and wagon respectively.Finance Minister Tendai Biti told the media that the railway system was on the verge of collapse as a result of mismanagement and failure to update its systems for more than two decades.
The World Bank once recommended that NRZ should close down two thirds of its railway network to allow for rehabilitation because of the potential disaster it poses.
Finance Minister Tendai Biti told the media that the railway system was on the verge of collapse as a result of mismanagement and failure to update its systems over the past 20 years.Zimbabwe's railway network covers over 300 kilometers and includes signaling and telecommunications.
NRZ, which is one of the major parastatals accused of rewarding big chefs with hefty salaries and allowances that skyrocket to US$10 000 per month, at the expense of improving service delivery came clean this week before the Permanent Secretary in the ministry of Finance, Willard Nungo and his colleague from the Transport, Communications and Infrastructural Development ministry, Patson Mbiriri.
The two government officials were on a tour of NRZ sites that included Makati caution area near Somabhula and Dabuka Marshalling Yards just outside Gweru to gain an appreciation on how NRZ was utilizing the Public Sector Investment Programme funds availed to it, when they learnt of the dilapidated state of the parastatal.
Also in attendance during the tour was NRZ's general manager – Retired Air Commodore Karakadzai who mourned what has been done to save the railway company and described it all as a "drop in the ocean."
To save the crumbling NRZ, government has to invest a staggering US$2 billion, money which the treasury does not have.
The parastatal has to attend to its railway line, general service and payments to its serving, retired employees, widows and pensioners. NRZ is paying its pensioners that include highly-skilled accountants, train-drivers, artisans, managers and clerks a paltry US$17 per month.
Further the parastatal has reportedly failed to pay its van attendants and other workers their salaries for last month and the US$17 each for the 13 000 pensioners nationwide.
The pensioners have joined hands with NRZ widows who also cry foul over being neglected by the parastatal because of the latter's failure to pay them their monthly stipends.
They have accused NRZ of being "cold hearted" as the company has of late also failed to pay the NRZ widows their monthly stipends. The widows have instead been recipients of pay slips indicating that their monies have been deducted to the last cent.
Investigations done by Bulawayo24.com have revealed that the pensioners, most of them who have spent more than three decades working for the once heavily paying parastatal have resorted to vending, gambling and all sorts of money – hunting escapades to subside their upkeep.
NRZ Spokesperson Fanuel Masikati confirmed that the company was facing liquidity problems but those problems have had little effect on its capacity to pay workers and pensioners their salaries.
"We have had financial problems but those problems have not adversely affected our capacity to pay our workers and pensioners. Efforts are underway to address the problems through revamping the system and improving our service delivery," said Masikati.
However pay slips of pensioners at hand who worked for more than two decades as train drivers and middle managers show that they earn US$27 and have a deduction of US$7 for Raimed ( NRZ's Medical Aid Scheme) – leaving them with a low US$ 10 to carter for their families.
Most of these pensioner's have a minimum of about between five and seven dependants – some have extended families. According to the Consumer Council of Zimbabwe mid-year living standards research, the average bread basket of a family of six is US$584.
The revelations come heavily after the Ministry of State Enterprises and Parastatals unearthed a scam showing that NRZ middle managers and other top brass members of the management were earning staggering salaries of between US$2000 –US$10 000 per month.
Said an ex-train driver Mr Agrippa Madlela: "We are in the dark about what NRZ thinks we are eating. I worked for more than 15 years and earn less than US$15 after deductions," he said.
NRZ is singing the blues because as early as January, the company failed to pay its salaries dating back to 2009.Then The Zimbabwe Amalgated Railway Workers Union (Zarwu) president – Charles Dube said the parastatal had only managed to pay workers in the lower grades half of their salaries for January and there "were no indications" as when they would get the remainder.
The upper grades also had no clue as when they would get their full salaries. "Our lowest paid workers get a minimum of US$80 per month," said Dube who added that the representatives of the workers met with the management on January 20 and the latter made an undertaking to solve the problem though noting that it might not be easy because of the parastatal's financial problems.
Railway Association of Engemen president, Norman Sibanda said the NRZ owes members of his union about US$4 000 since 2009 no date has been set for settling the debt.
State Enterprises and Parastals Minister Godern Moyo recently said government is considering opening up the railway network to private players. This he said after its was realized that the NRZ's monopoly is drowning in a ballooning US$ 274 million deficit of depleted fleet and recapitalization costs.
A committee comprising of officials from the State Enterprises Restructuring Agency (SERA) , Ministry of Transport and the NRZ board was set up to formulate viable strategies to resuscitate the ailing sector.
NRZ's service delivery has been in decline over the past decade, from a capacity of 18 million tons per year to down only 5,3 million tones. The embattled parastatal is left with 33 functioning diesel and one electric locomotive out of more than 62 and 10 respectively. About US$ 750 000 and US$20 00 is required to refurbish each locomotive and wagon respectively.Finance Minister Tendai Biti told the media that the railway system was on the verge of collapse as a result of mismanagement and failure to update its systems for more than two decades.
The World Bank once recommended that NRZ should close down two thirds of its railway network to allow for rehabilitation because of the potential disaster it poses.
Finance Minister Tendai Biti told the media that the railway system was on the verge of collapse as a result of mismanagement and failure to update its systems over the past 20 years.Zimbabwe's railway network covers over 300 kilometers and includes signaling and telecommunications.
Source - Byo24News
