News / National
Finance Minister stirs controversy
22 Dec 2018 at 16:34hrs | Views
Finance and Economic Development minister Mthuli Ncube has divided opinion after appointing his permanent secretary, George Guvamatanga, to the board of the Zimbabwe Revenue Authority (Zimra).
Guvamatanga, who left Barclays Bank under a cloud last year, is among six board members designated to lead the revenue collector after Ncube fired the Willia Bonyongwe-led Zimra board in October.
In appointing Guvamatanga to the Zimra board, Ncube relied on Section 5 of the Revenue Authority Act which says it shall consist of the secretary of the ministry and the commissioner-general and not more than eight other members, subject to sub-section 3, and after consultation with the President.
But legal experts argued yesterday that Section 5 of the Act must be read consistently with section 11(5) of the Public Entities Corporate Governance Act, which says government officials - including permanent secretaries - cannot serve as members of public enterprises' boards.
"Section 5 of the Revenue Authority Act must be read consistently with section 11(5) of the Public Entities Corporate Governance Act, unless of course he argues that Zimra is not a public entity. But this would be absurd because Zimra is indeed a public entity as defined in the Public Entities Corporate Governance Act," said constitutional law expert, Alex Magaisa.
MDC spokesperson Jacob Mafume said Guvamatanga cannot be part of a board that he is supposed to superintend over and punish if the need arises.
"The board reports to him; he cannot be a member of a board that reports to him. Being an ex-officio member does not mean he has no executive powers. The problem is that he will be reporting to himself," said Mafume.
"…He is the one who is supposed to punish the board if it does not perform. They are setting a bad precedence for other ministries and that will only fan corruption — it seems the crusade against corruption by (President Emmerson) Mnangagwa is now dead in the water," he added.
Former Zanu PF spin-doctor-turned critic, Jonathan Moyo also poured scorn at Guvamatanga's appointment yesterday.
Moyo tweeted: "Technocrat @MthuliNcube must check legality of his appointments and lawyer Mnangagwa must check legality of recommended appointments. It's illegal for Guvamatanga, a perm sec, to sit on Zimra board, a public entity!"
The ministry of Finance superintends over Zimra and other key institutions such as the Reserve Bank of Zimbabwe.
In most ministries, their day-to-day activities are the responsibility of the permanent secretary, who is the principal officer.
To all intents and purposes, ministers are just figureheads who act on the guidance of the principal officer.
By appointing Guvamatanga to the Zimra board, Ncube is being rapped for creating an unworkable arrangement whereby the permanent secretary becomes both the player and a referee.
Yesterday, government defended the appointment saying it is actually part of good corporate governance.
Justice minister Ziyambi Ziyambi said Guvamatanga was coming in as an ex-officio member because Zimra collects revenue on behalf of government.
"…this is actually good governance because he is the secretary for finance in the Treasury. Zimra is not a company that is doing business to make a profit but an agency that collects taxes from companies to make a profit," said Ziyambi.
Since his appointment to the high-pressure job, Ncube has raffled feathers.
As part of his austerity measures to bridge a widening budget deficit, Ncube introduced a two percent tax on electronic transactions that significantly increased the cost of doing business by fuelling price increases.
He also stoked controversy by appointing controversial activist Acie Lumumba as chair of a communications taskforce in the ministry, triggering sharp criticism from inside and outside government, with many questioning his judgment in appointing a person with a chequered history littered with scandals that range from graft to leaked sex tapes.
Three days after he assumed the position, Ncube was pressured into withdrawing Lumumba's appointment letter.
The Finance minister has also confused markets over his position regarding the future of bond notes.
The appointment of bureaucrats in the civil service to boards of public enterprises has been a topical issue lately.
In 2014, then president Robert Mugabe's spokesperson George Charamba stirred a hornet's nest after an audit of the Premier Service Medical Aid Society revealed that he was paid US$228 278 in board fees and allowances between 2009 and 2013 in a scandal that became known as salarygate in which top executives of parastatals were earning jaw-dropping perks.
Several government officials, including ministers and permanent secretaries, have been arrested for interfering in boards that fall under their ambits.
Former permanent secretary in the ministry of Mines and Mining Development Francis Gudyanga is currently facing charges of abuse of office after he solely sat on the board of the Minerals Marketing Corporation of Zimbabwe (MMCZ).
Gudyanga, whose cases are still pending before the courts allegedly helped himself to sitting allowances for none existent board meetings of the MMCZ.
Guvamatanga, who left Barclays Bank under a cloud last year, is among six board members designated to lead the revenue collector after Ncube fired the Willia Bonyongwe-led Zimra board in October.
In appointing Guvamatanga to the Zimra board, Ncube relied on Section 5 of the Revenue Authority Act which says it shall consist of the secretary of the ministry and the commissioner-general and not more than eight other members, subject to sub-section 3, and after consultation with the President.
But legal experts argued yesterday that Section 5 of the Act must be read consistently with section 11(5) of the Public Entities Corporate Governance Act, which says government officials - including permanent secretaries - cannot serve as members of public enterprises' boards.
"Section 5 of the Revenue Authority Act must be read consistently with section 11(5) of the Public Entities Corporate Governance Act, unless of course he argues that Zimra is not a public entity. But this would be absurd because Zimra is indeed a public entity as defined in the Public Entities Corporate Governance Act," said constitutional law expert, Alex Magaisa.
MDC spokesperson Jacob Mafume said Guvamatanga cannot be part of a board that he is supposed to superintend over and punish if the need arises.
"The board reports to him; he cannot be a member of a board that reports to him. Being an ex-officio member does not mean he has no executive powers. The problem is that he will be reporting to himself," said Mafume.
"…He is the one who is supposed to punish the board if it does not perform. They are setting a bad precedence for other ministries and that will only fan corruption — it seems the crusade against corruption by (President Emmerson) Mnangagwa is now dead in the water," he added.
Former Zanu PF spin-doctor-turned critic, Jonathan Moyo also poured scorn at Guvamatanga's appointment yesterday.
Moyo tweeted: "Technocrat @MthuliNcube must check legality of his appointments and lawyer Mnangagwa must check legality of recommended appointments. It's illegal for Guvamatanga, a perm sec, to sit on Zimra board, a public entity!"
The ministry of Finance superintends over Zimra and other key institutions such as the Reserve Bank of Zimbabwe.
In most ministries, their day-to-day activities are the responsibility of the permanent secretary, who is the principal officer.
To all intents and purposes, ministers are just figureheads who act on the guidance of the principal officer.
Yesterday, government defended the appointment saying it is actually part of good corporate governance.
Justice minister Ziyambi Ziyambi said Guvamatanga was coming in as an ex-officio member because Zimra collects revenue on behalf of government.
"…this is actually good governance because he is the secretary for finance in the Treasury. Zimra is not a company that is doing business to make a profit but an agency that collects taxes from companies to make a profit," said Ziyambi.
Since his appointment to the high-pressure job, Ncube has raffled feathers.
As part of his austerity measures to bridge a widening budget deficit, Ncube introduced a two percent tax on electronic transactions that significantly increased the cost of doing business by fuelling price increases.
He also stoked controversy by appointing controversial activist Acie Lumumba as chair of a communications taskforce in the ministry, triggering sharp criticism from inside and outside government, with many questioning his judgment in appointing a person with a chequered history littered with scandals that range from graft to leaked sex tapes.
Three days after he assumed the position, Ncube was pressured into withdrawing Lumumba's appointment letter.
The Finance minister has also confused markets over his position regarding the future of bond notes.
The appointment of bureaucrats in the civil service to boards of public enterprises has been a topical issue lately.
In 2014, then president Robert Mugabe's spokesperson George Charamba stirred a hornet's nest after an audit of the Premier Service Medical Aid Society revealed that he was paid US$228 278 in board fees and allowances between 2009 and 2013 in a scandal that became known as salarygate in which top executives of parastatals were earning jaw-dropping perks.
Several government officials, including ministers and permanent secretaries, have been arrested for interfering in boards that fall under their ambits.
Former permanent secretary in the ministry of Mines and Mining Development Francis Gudyanga is currently facing charges of abuse of office after he solely sat on the board of the Minerals Marketing Corporation of Zimbabwe (MMCZ).
Gudyanga, whose cases are still pending before the courts allegedly helped himself to sitting allowances for none existent board meetings of the MMCZ.
Source - Daily News
