Business / Economy
Auditor-General exposes ministers
25 May 2012 at 22:48hrs | Views
THE tale of an economist with power utility, ZESA Holdings, who was
repeatedly questioned over his loss of a cellular phone bought using
taxpayers money helps to underscore the level of thoroughness the
Comptroller and Auditor-General (C&AG), Mildred Chiri exercises when
accounting for public funds.
The economist, who otherwise should have known better, came under intense grilling after he lost three phones in less than 18 months, each being bought for nearly US$500 using government funds.
Sadly, that sternness is not matched anywhere else in government ministries, where most audited reports show that, by and large, ministers, permanent secretaries and heads of parastatals are sleeping on duty.
In more than five reports submitted to Parliament on May 15, the first batch submitted so far this year, one common thread that runs through the audited accounts is the existence of inadequate or lack of asset registers, making losses, damages or theft of State property go undetected.
Where loss of public assets is detected, government ministries have failed to constitute boards of inquiry as required by law for purposes of investigating the circumstances of the loss as well as identify those responsible.
In the reports, Chiri also revealed that a number of ministries had poor record-keeping or did not keep records at all, making it difficult to properly account or collect revenues or identify State debtors.
A case in point is where a US$5 million debt by water defaulters was cancelled in 2009 because the Zimbabwe National Water Authority had no names of the defaulting consumers.
Despite the C&AG's spirited attempts to unravel the plunder of State resources, her efforts have not borne fruit because of the legal requirement compelling her to first submit reports to the Executive for tabling in Parlia-ment, a process that would then lead to the reports being made public.
One grave consequence of that requirement is that most ministers have sat on the reports, denying the public access to vital information in the process.
According to the Audit and Exchequer Act, all audited reports must be submitted to the respective ministers, with a proviso that says they can be handed to the Speaker of the House of Assembly for tabling if the former has not done so within the next seven consecutive sittings of Parliament.
In cases where ministers have not submitted the reports to Parliament, as some of them may not be favourable to them, successive C&AGs have shied away from taking them straight to the Speaker for tabling for fear of straining relations with members of the Executive.
However, this year was different as for the first time in history; Parliament went straight to the C&AG's office and requested the reports, circumventing ministers in the process.
On May 15, the Speaker of Parliament, Lovemore Moyo then tabled the reports that ministers had failed to bring to Parliament.
Among the tabled accounts was one on parastatals and State enterprises that Chiri had handed over to Finance Minister, Tendai Biti on August 12 last year, only to see the light of day last week, thanks to the Speaker's intervention.
In an interview, the deputy clerk of Parliament, Kennedy Chokuda, said following delays by ministers to table the reports, the legislative assembly and the audit office reached an understanding for the Speaker to do the job.
"We wrote to the auditor general. She is empowered to request the Speaker to table the reports. It's provided for in the Public Finance Management Act," said Chokuda.
Nearly all the tabled audited reports contained startling revelations of abuse of public funds as well as failure to safeguard State property.
For example, the board of the Rural Electricity Agency (REA) was exposed for giving board members and staff loans, some to the tune of US$290 000 per person, under questionable circumstances.
No loan agreements were signed and no collateral security was provided, leaving public funds open to abuse and fraud.
In 2010 alone, officials at REA handed themselves US$1,57 million in loans.
As for the Ministry of Justice and Legal Affairs, the C&AG said she could not establish whether or not all the receipts, payments, vehicle accessories and adva-nces were properly accounted for as the ministry did not maintain a cash book, vehicle register, travel and subsistence register.
For six successive years, the Justice Ministry had also not complied with the auditors' recommendation to keep a master asset register.
The C&AG also expressed great concern that the Ministry of Youth, Indigenisation and Empowerment for paying some people who had never taken employment within the ministry.
Saviour Kasukuwere's ministry did not only fail to provide a register of properties in its control but could not produce evidence that ministry officials residing in government properties were paying rentals due to the State.
At the Youth Ministry's Takawira Farm, farming activities requiring bulk water were said to have been affected as a top ministry official had taken an electric motor for "repairs" but there was no voucher or documentary evidence to that effect.
Despite the exposures, impunity within ministries has continued as audited reports remained locked in ministers' offices without reaching Parlia-ment for them to be made public to ensure remedial action is taken.
In terms of Section 106 subsection (1) of the country's Constitution as well as Section 14 of the Audit and Exchequer Act (Chapter 22:03), the C&AG is required to examine all of the State's finances â€" fees, taxes and other revenues from whatever source.
The statute says the C&AG is mandated to examine, inquire into and audit the accounts of all persons entrusted with public moneys or State property to ensure that receipts and disbursements have been accounted for as well as making sure that all reasonable precautions have been taken to safeguard State property and resources.
The issue of the shelving of the reports and difficulties in accessing them also underlines the need for the country to have a Freedom of Information Bill as previously promised by the inclusive government to replace the Access to Information and Protection of Privacy Act which hinders unfettered access to information.
In an interview, Chiri said besides ministries missing statutory deadlines for submitting financial statements as a contributory factor to late release of reports, sometimes ministers fail to take completed ones to Parliament as they would be "busy".
"The main cause of the delays in releasing audited accounts has been failure to submit their financial statements on statutory deadlines. The delays in submission of the financial statements in turn delay my audit and my meeting of my audit statutory deadline," said Chiri.
"However, regarding the 2009 and 2010 annual audit reports, these are ready for tabling. The 2009 report has been ready for tabling since November 2011 but however, the minister has been too busy to table the report in Parliament.
"My office is now up to date and is currently auditing the 2011 financial year."
Economist, John Robertson, said the country has adequate laws to ensure that both the public and media have access to information with regards to what would be coming from the auditor's office, but the only problem is that the laws are not being enforced.
"There was laxity by the audit office regarding bad practices during the Zimbabwe dollar era. Now there is no room for that since dollarisation.
"The laws are there, but what is needed is enforcement," said Robertson.
The chairperson of the Public Accounts Committee (PAC), Webber Chinyadza, agreed.
While the C&AG has done her part in lifting the veil of secrecy around government finances, Chinyadza said there is an entrenched culture of bad practices within government, with no action being taken.
Chinyadza, however, said the PAC would now be proactive in pushing for corrective measures as there are enough safeguards in the country's laws such as the Public Finance Management Act to enforce accountability and public disclosure.
"Recently, we wrote a letter to the Accountant General to follow up with all the ministries regarding some observations that were made.
"There is going to be due process and this time anyone found on the wrong side we will charge them with contempt of Parliament.
"We are going to change the attitude towards accounting, people would be charged with contempt of Parliament," said Chinyadza
The economist, who otherwise should have known better, came under intense grilling after he lost three phones in less than 18 months, each being bought for nearly US$500 using government funds.
Sadly, that sternness is not matched anywhere else in government ministries, where most audited reports show that, by and large, ministers, permanent secretaries and heads of parastatals are sleeping on duty.
In more than five reports submitted to Parliament on May 15, the first batch submitted so far this year, one common thread that runs through the audited accounts is the existence of inadequate or lack of asset registers, making losses, damages or theft of State property go undetected.
Where loss of public assets is detected, government ministries have failed to constitute boards of inquiry as required by law for purposes of investigating the circumstances of the loss as well as identify those responsible.
In the reports, Chiri also revealed that a number of ministries had poor record-keeping or did not keep records at all, making it difficult to properly account or collect revenues or identify State debtors.
A case in point is where a US$5 million debt by water defaulters was cancelled in 2009 because the Zimbabwe National Water Authority had no names of the defaulting consumers.
Despite the C&AG's spirited attempts to unravel the plunder of State resources, her efforts have not borne fruit because of the legal requirement compelling her to first submit reports to the Executive for tabling in Parlia-ment, a process that would then lead to the reports being made public.
One grave consequence of that requirement is that most ministers have sat on the reports, denying the public access to vital information in the process.
According to the Audit and Exchequer Act, all audited reports must be submitted to the respective ministers, with a proviso that says they can be handed to the Speaker of the House of Assembly for tabling if the former has not done so within the next seven consecutive sittings of Parliament.
In cases where ministers have not submitted the reports to Parliament, as some of them may not be favourable to them, successive C&AGs have shied away from taking them straight to the Speaker for tabling for fear of straining relations with members of the Executive.
However, this year was different as for the first time in history; Parliament went straight to the C&AG's office and requested the reports, circumventing ministers in the process.
On May 15, the Speaker of Parliament, Lovemore Moyo then tabled the reports that ministers had failed to bring to Parliament.
Among the tabled accounts was one on parastatals and State enterprises that Chiri had handed over to Finance Minister, Tendai Biti on August 12 last year, only to see the light of day last week, thanks to the Speaker's intervention.
In an interview, the deputy clerk of Parliament, Kennedy Chokuda, said following delays by ministers to table the reports, the legislative assembly and the audit office reached an understanding for the Speaker to do the job.
"We wrote to the auditor general. She is empowered to request the Speaker to table the reports. It's provided for in the Public Finance Management Act," said Chokuda.
Nearly all the tabled audited reports contained startling revelations of abuse of public funds as well as failure to safeguard State property.
For example, the board of the Rural Electricity Agency (REA) was exposed for giving board members and staff loans, some to the tune of US$290 000 per person, under questionable circumstances.
No loan agreements were signed and no collateral security was provided, leaving public funds open to abuse and fraud.
In 2010 alone, officials at REA handed themselves US$1,57 million in loans.
As for the Ministry of Justice and Legal Affairs, the C&AG said she could not establish whether or not all the receipts, payments, vehicle accessories and adva-nces were properly accounted for as the ministry did not maintain a cash book, vehicle register, travel and subsistence register.
For six successive years, the Justice Ministry had also not complied with the auditors' recommendation to keep a master asset register.
The C&AG also expressed great concern that the Ministry of Youth, Indigenisation and Empowerment for paying some people who had never taken employment within the ministry.
Saviour Kasukuwere's ministry did not only fail to provide a register of properties in its control but could not produce evidence that ministry officials residing in government properties were paying rentals due to the State.
At the Youth Ministry's Takawira Farm, farming activities requiring bulk water were said to have been affected as a top ministry official had taken an electric motor for "repairs" but there was no voucher or documentary evidence to that effect.
Despite the exposures, impunity within ministries has continued as audited reports remained locked in ministers' offices without reaching Parlia-ment for them to be made public to ensure remedial action is taken.
In terms of Section 106 subsection (1) of the country's Constitution as well as Section 14 of the Audit and Exchequer Act (Chapter 22:03), the C&AG is required to examine all of the State's finances â€" fees, taxes and other revenues from whatever source.
The statute says the C&AG is mandated to examine, inquire into and audit the accounts of all persons entrusted with public moneys or State property to ensure that receipts and disbursements have been accounted for as well as making sure that all reasonable precautions have been taken to safeguard State property and resources.
The issue of the shelving of the reports and difficulties in accessing them also underlines the need for the country to have a Freedom of Information Bill as previously promised by the inclusive government to replace the Access to Information and Protection of Privacy Act which hinders unfettered access to information.
In an interview, Chiri said besides ministries missing statutory deadlines for submitting financial statements as a contributory factor to late release of reports, sometimes ministers fail to take completed ones to Parliament as they would be "busy".
"The main cause of the delays in releasing audited accounts has been failure to submit their financial statements on statutory deadlines. The delays in submission of the financial statements in turn delay my audit and my meeting of my audit statutory deadline," said Chiri.
"However, regarding the 2009 and 2010 annual audit reports, these are ready for tabling. The 2009 report has been ready for tabling since November 2011 but however, the minister has been too busy to table the report in Parliament.
"My office is now up to date and is currently auditing the 2011 financial year."
Economist, John Robertson, said the country has adequate laws to ensure that both the public and media have access to information with regards to what would be coming from the auditor's office, but the only problem is that the laws are not being enforced.
"There was laxity by the audit office regarding bad practices during the Zimbabwe dollar era. Now there is no room for that since dollarisation.
"The laws are there, but what is needed is enforcement," said Robertson.
The chairperson of the Public Accounts Committee (PAC), Webber Chinyadza, agreed.
While the C&AG has done her part in lifting the veil of secrecy around government finances, Chinyadza said there is an entrenched culture of bad practices within government, with no action being taken.
Chinyadza, however, said the PAC would now be proactive in pushing for corrective measures as there are enough safeguards in the country's laws such as the Public Finance Management Act to enforce accountability and public disclosure.
"Recently, we wrote a letter to the Accountant General to follow up with all the ministries regarding some observations that were made.
"There is going to be due process and this time anyone found on the wrong side we will charge them with contempt of Parliament.
"We are going to change the attitude towards accounting, people would be charged with contempt of Parliament," said Chinyadza
Source - Fingaz