News / National
Bid to block Zinara probe backfires
28 Aug 2017 at 01:26hrs | Views
FOUR senior public officials, including two directors in the Ministry of Transport and Infrastructural Development, have been suspended for trying to block investigations into the abuse of State funds for the rehabilitation of rural roads, it has emerged.
The directors are Ms Angeline Karonga, legal director and Engineer Eric Gumbie, who is director of roads. Ms Karonga and Eng Gumbie also face separate charges of foisting companies in which they are directors as contractors on various road authorities.
Zimbabwe National Roads Administration (Zinara) technical director Engineer Moses Juma and Goromonzi RDC chief executive officer Mr Trust Madhovi have also been suspended.
Government's investigating team was appointed in terms of Section 46 (2) of the Procurement Act after the Office of the President and Cabinet (OPC) directed the State Procurement Board (SPB) to commission an investigation into various contracts flagged in a forensic report on Zinara by Grant Thornton.
The team —comprising officials from the SPB, the Auditor-General's Office and the National Economic Conduct Inspectorate (NECI) — reviewed the procurement process of tender awards under Zinara's special projects valued at $71,5 million and R31,5 million ($2,5 million) covering a five-year period from 2011 to 2016.
It is believed the investigations remain inconclusive as "some officers implicated in the contracts under review" hold influential positions that enable them to frustrate investigators.
Information gathered by The Herald indicates that the suspensions follow letters written by SPB executive chairperson Ambassador Buzawani Mothobi on August 22, 2017 to the Ministry of Transport, Zinara and the Ministry of Rural Development, Preservation of National Culture and Heritage.
The SPB boss specifically recommended the suspension of the officials for being uncooperative during investigations.
Section 46(6) of the Procurement Act provides specific sanctions for anyone who hinders investigations without just cause.
It is alleged that Ms Karonga and Civil Aviation Authority of Zimbabwe (CAAZ) chief executive officer Mr David Chaota are co-directors in Akodec, a company that features prominently as a contractor for road works that were funded by Zinara.
Eng Gumbie's firm, Tencraft, is reportedly involved in some of the questionable tenders.
According to a preliminary report on the investigation of special projects funded by Zinara for various road authorities, which is dated August 21, 2017, Zinara's Engineer Juma was accused of being "at the centre of the improper engagements of various contractors for the implementation of contracts by road authorities".
The 22-page preliminary report - compiled by investigators based on procurement processes at RDCs in Gutu, Zaka and Goromonzi - details how officials seemingly violated tender procedures in order to milk State funds.
Engineer Juma, who was then Zinara regional engineer (Northern), is mainly accused of forcing Gutu RDC council chairperson Mr Daniel Jinga and former roads and works planning chairperson Mr Emmanuel Toperesu to engage a company called Fremus in May 2011 for the rehabilitation of a 31-kilometre stretch of road without the knowledge and consent of council CEO, Mr Alexanda Mutembwa.
When an attempt was made to rescind the irregular contract, it is believed that Engineer Juma threatened to withdraw funding for the project.
Section 30 and 31(2) of the Procurement Act as read with Sections 4,5,6 and 7 of the Procurement Regulations 2002 require a competitive process for the selection of a contractor.
It is alleged that the contract did not have a detailed scope of works nor a contract sum.
The deal also resulted in seemingly irregular payments.
About $150 000 was paid to Fremus by Zinara on February 17, 2011 before the RDC had resolved to adopt the contract.
Overall, Gutu RDC raised interim payment certificates (IPCs) worth $1,7 million that were paid to the contractor, but Zinara's ledger shows that they had made total payments of $2 million, giving a variance of $316 000.
In a normal procurement process, a contractor raises an IPC, which the RDC engineer and CEO certify and approve before it is forwarded to Zinara.
It is only after a road technician from Zinara certifies the work that a payment is processed.
"The variance of $315 722,67 shows an overpayment done by Zinara to Fremus which could be a potential prejudice to the State," reads part of the report.
"Gutu RDC alleged that they never signed IPC 1 and 3 and only managed to provide IPC 2,4,5 and 6. They referred the investigation team to Zinara offices for copies of the missing IPC's which they used to make payments to the contractor. However, Zinara could not provide the team with the supporting documentation they used to make the payments to the contractor."
Accounting officers, through Section 35(1) of the Procurement Act and Section 6 (3) of the Procurement Regulations, are required to retain records for accounting purposes.
Fremus was also reportedly forced on Zaka RDC in September 2011 and again the contract did not have a contract sum or a scope of works.
According to the report, Zinara overpaid for the works by more than $205 000.
It also suspiciously made an additional payment of $156 519 "for the mobilisation of additional works" after Fremus applied for a contract variation on December 31, 2011 to include a 5,1- kilometre stretch on the Chivamba-Chipfunde-Svuure road.
The report says: "A further analysis of the interim payment certificates (IPCs) provided by Zaka RDC had a total of $1 754 635.70, whereas Zinara ledger showed that they had made total payment of $1 844 011.47 to Fremus which gives a variance (overpayment of) $89 365.77."
In 2013, Fremus later wrote a letter to Zaka RDC claiming that they did not factor in Value Added Tax (VAT) charges on their initial contracts, which amounts Zinara duly paid without questioning.
The same procurement violations were observed in Goromonzi RDC, where companies such as Twalumba, Bermipool and Tencraft (Engineer Gumbie's company) were engaged.
The contracts were mainly for five projects – Atlanta Road, Eton-Renari Road, Eton-Remari Road, Bosha and St John Road and resurfacing of Eton.
Again there are suspicions that project costs were inflated.
Crucial documents also remain unaccounted for.
The probe team is also interested in details of the procurement of raw materials (bitumen and aggregates) for two Asphalt plants – in Harare and Bulawayo – that are owned by the Ministry of Transport.
Between 2011 and 2016, more than $25 million was paid to 22 companies for the services, including for expenses directly attributable to the management of the two plants.
Government has doubled its efforts to weed out corruption in the public sector to promote the judicious use of taxpayer's funds.
The directors are Ms Angeline Karonga, legal director and Engineer Eric Gumbie, who is director of roads. Ms Karonga and Eng Gumbie also face separate charges of foisting companies in which they are directors as contractors on various road authorities.
Zimbabwe National Roads Administration (Zinara) technical director Engineer Moses Juma and Goromonzi RDC chief executive officer Mr Trust Madhovi have also been suspended.
Government's investigating team was appointed in terms of Section 46 (2) of the Procurement Act after the Office of the President and Cabinet (OPC) directed the State Procurement Board (SPB) to commission an investigation into various contracts flagged in a forensic report on Zinara by Grant Thornton.
The team —comprising officials from the SPB, the Auditor-General's Office and the National Economic Conduct Inspectorate (NECI) — reviewed the procurement process of tender awards under Zinara's special projects valued at $71,5 million and R31,5 million ($2,5 million) covering a five-year period from 2011 to 2016.
It is believed the investigations remain inconclusive as "some officers implicated in the contracts under review" hold influential positions that enable them to frustrate investigators.
Information gathered by The Herald indicates that the suspensions follow letters written by SPB executive chairperson Ambassador Buzawani Mothobi on August 22, 2017 to the Ministry of Transport, Zinara and the Ministry of Rural Development, Preservation of National Culture and Heritage.
The SPB boss specifically recommended the suspension of the officials for being uncooperative during investigations.
Section 46(6) of the Procurement Act provides specific sanctions for anyone who hinders investigations without just cause.
It is alleged that Ms Karonga and Civil Aviation Authority of Zimbabwe (CAAZ) chief executive officer Mr David Chaota are co-directors in Akodec, a company that features prominently as a contractor for road works that were funded by Zinara.
Eng Gumbie's firm, Tencraft, is reportedly involved in some of the questionable tenders.
According to a preliminary report on the investigation of special projects funded by Zinara for various road authorities, which is dated August 21, 2017, Zinara's Engineer Juma was accused of being "at the centre of the improper engagements of various contractors for the implementation of contracts by road authorities".
The 22-page preliminary report - compiled by investigators based on procurement processes at RDCs in Gutu, Zaka and Goromonzi - details how officials seemingly violated tender procedures in order to milk State funds.
Engineer Juma, who was then Zinara regional engineer (Northern), is mainly accused of forcing Gutu RDC council chairperson Mr Daniel Jinga and former roads and works planning chairperson Mr Emmanuel Toperesu to engage a company called Fremus in May 2011 for the rehabilitation of a 31-kilometre stretch of road without the knowledge and consent of council CEO, Mr Alexanda Mutembwa.
When an attempt was made to rescind the irregular contract, it is believed that Engineer Juma threatened to withdraw funding for the project.
Section 30 and 31(2) of the Procurement Act as read with Sections 4,5,6 and 7 of the Procurement Regulations 2002 require a competitive process for the selection of a contractor.
It is alleged that the contract did not have a detailed scope of works nor a contract sum.
The deal also resulted in seemingly irregular payments.
Overall, Gutu RDC raised interim payment certificates (IPCs) worth $1,7 million that were paid to the contractor, but Zinara's ledger shows that they had made total payments of $2 million, giving a variance of $316 000.
In a normal procurement process, a contractor raises an IPC, which the RDC engineer and CEO certify and approve before it is forwarded to Zinara.
It is only after a road technician from Zinara certifies the work that a payment is processed.
"The variance of $315 722,67 shows an overpayment done by Zinara to Fremus which could be a potential prejudice to the State," reads part of the report.
"Gutu RDC alleged that they never signed IPC 1 and 3 and only managed to provide IPC 2,4,5 and 6. They referred the investigation team to Zinara offices for copies of the missing IPC's which they used to make payments to the contractor. However, Zinara could not provide the team with the supporting documentation they used to make the payments to the contractor."
Accounting officers, through Section 35(1) of the Procurement Act and Section 6 (3) of the Procurement Regulations, are required to retain records for accounting purposes.
Fremus was also reportedly forced on Zaka RDC in September 2011 and again the contract did not have a contract sum or a scope of works.
According to the report, Zinara overpaid for the works by more than $205 000.
It also suspiciously made an additional payment of $156 519 "for the mobilisation of additional works" after Fremus applied for a contract variation on December 31, 2011 to include a 5,1- kilometre stretch on the Chivamba-Chipfunde-Svuure road.
The report says: "A further analysis of the interim payment certificates (IPCs) provided by Zaka RDC had a total of $1 754 635.70, whereas Zinara ledger showed that they had made total payment of $1 844 011.47 to Fremus which gives a variance (overpayment of) $89 365.77."
In 2013, Fremus later wrote a letter to Zaka RDC claiming that they did not factor in Value Added Tax (VAT) charges on their initial contracts, which amounts Zinara duly paid without questioning.
The same procurement violations were observed in Goromonzi RDC, where companies such as Twalumba, Bermipool and Tencraft (Engineer Gumbie's company) were engaged.
The contracts were mainly for five projects – Atlanta Road, Eton-Renari Road, Eton-Remari Road, Bosha and St John Road and resurfacing of Eton.
Again there are suspicions that project costs were inflated.
Crucial documents also remain unaccounted for.
The probe team is also interested in details of the procurement of raw materials (bitumen and aggregates) for two Asphalt plants – in Harare and Bulawayo – that are owned by the Ministry of Transport.
Between 2011 and 2016, more than $25 million was paid to 22 companies for the services, including for expenses directly attributable to the management of the two plants.
Government has doubled its efforts to weed out corruption in the public sector to promote the judicious use of taxpayer's funds.
Source - the herald
