News / National
Mthuli Ncube summoned
30 Aug 2019 at 20:25hrs | Views
PARLIAMENT says government finances are in a mess and has summoned Finance minister Mthuli Ncube - as a matter of urgency - to regularise a series of unauthorised expenditures which now include the ZW$10,85 billion supplementary budget which he presented earlier this month.
Legislators also say government - and Treasury's - accounting systems are in a shambles.
The MPs wants Ncube to appear in parliament to "seek condonation of all the unauthorised expenditure incurred since 2014".
Government has been engaging in extra budgetary expenditures without parliamentary approval.
For instance, MPs say government spent ZW$2,7 billion - which was then equivalent to US$2,7 billion in 2017; ZW$3,2 billion in 2018 and recently announced plans to spend ZW$10,85 billion - all without parliament authorisation - on top of the ZW$8 billion 2019 budget.
Parliament's demands and recommendations are contained in a report by the Parliamentary Portfolio Committee (Pac) on Public Accounts titled First Report of the Public Accounts Committee on Compliance Issues for the Ministry of Finance and Economic Development: First Session - Ninth Parliament, obtained by Zimbabwe Independent.
The legislature also wants Ncube to account for state loans and guarantees. MPs have thus given him up to September 30 - in some cases up to tomorrow - to disclose the terms and conditions of all public loans and loan guarantees that have not been published.
The legislators also queried the exact amount of Zimbabwe total debt stock.
Ncube told parliament during his mid-term budget review on August 1 that: "Zimbabwe's total debt stock is estimated at ZWL$66,8 billion as at the end of June. As at the end of June 2019, external public and publicly guaranteed debt position is estimated at US$8 billion (ZWL$58,1 billion, of which almost US$5,9 billion (ZWL$42,7 billion) is accumulated arrears.
"Multilateral institutions are owed a total of US$2,5 billion (ZWL$18,5 billion), of which the World Bank is owed US$1,5 billion (ZWL$10,6 billion), African Development Bank US$702 million (ZWL$5,1 billion), European Investment Bank US$309 million (ZWL$2,2 billion) and other multilaterals US$74 million (ZWL$535 million).
"Total bilateral debt amounted to US$5,5 billion (ZWL$39,6 billion), with Paris Club creditors accounting for US$3,5 billion (ZWL$25,1 billion) and non-Paris Club US$1,6 billion (ZWL$11,3 billion)."
When Ncube presented his 2019 national budget in November last year, he said the country's domestic debt stood at US$9,6 billion, while the total debt was US$17,6 billion. This meant external debt was US$8 billion - which it remains as now. The dramatic change, though, has been on the domestic debt. From US$9,6 billion, it is now a mere ZWL$8,8 billion (US$880 million).
"Consequently, adherence to sound fiscal and monetary policy reforms allowed containment of domestic debt stock which stood at ZWL$8,8 billion as at end June 2019, down from ZWL$9,5 billion as at December 31, 2018," Ncube said.
The Independent scrutinised and analysed Ncube's figures and discovered a staggering US$7 billion grand heist by government on domestic creditors. Further, parliament also wants accountability on a series of violations of the constitution and the law - at least 17 breaches - on public spending, resulting is massive waste of public funds.
The report reveals government's financial systems are dysfunctional and that Treasury finances are in a shambles. It also exposes a series of acts of non-compliance by the Ministry of Finance on expenditure in relation to the constitution and the law.
Laws that the Finance ministry has failed to comply with in the course of public expenditures over the past couple of years include the Public Finance Management (PFM) Act and the Public Debt Management (PDM) Act.
"Government must at all times adhere to the approved budget. The Minister of Finance and Economic Development must as a matter of urgency bring to the National Assembly, bills seeking condonation of all the unauthorised expenditure incurred since 2014. Such condonation must be sought by end of August 2019," the report says.
The report of the Pac committee - chaired by former Finance minister Tendai Biti - gives examples of 17 actions of non-compliance with the constitution and the law on public spending. Among the 17 actions are non-compliance with the provisions of section 300 (3) of the constitution in that Ncube failed to publish, in the Government Gazette, loans contracted and guarantees issued by government within 60 days of their conclusion.
The report also says Ncube did not comply with Section 300(4) of the constitution in that he failed to present to parliament a report on loans raised and guarantees issued by the state and a comprehensive report on public debt. Ncube also failed to comply with section 305(5) of the constitution in that he failed to present in the National Assembly additional or supplementary estimates of expenditure and additional or supplementary bills.
Other acts of non-compliance noted by the report include non-compliance with the provisions of Section 23(1) of the-PFM Act (Chapter 22:19) in that since 2014, the Accountant- General had failed to issue warrants under his hand, authorising accounting officers to incur expenditure up to the limits and for the purposes and subjects to conditions contained therein.
There was also non-compliance with Section 30 of the-PFM Act (Chapter 22:19) in that Treasury failed to withhold funds appropriated to ministries whose functions were assigned to other ministries and to allocate those remaining funds to other ministries or institutions as well as non-compliance with section 11(2) of the Public Debt Management Act in that the limits for government's borrowing were not fixed by the National Assembly by resolution nor by means of a provision in a Finance Bill.
According to the report, the true extent of the country's debt is unknown, with Treasury providing varying figures. As a result, Ncube has been summoned to provide accurate figures. What has worsened the chaos is that the total domestic and foreign debt of US$17,69 billion as at August 2018 reported in the 2019 budget statement was different to the US$9,2 billion reflected in the 2019 budget estimates.
"The Committee also noted that some external debts were improperly classified as domestic debt. Examples include China Nanchang Engineering, China International Water and Electricity Corporation and RBZ-/Zisco/Dutch, Mota Engil and HCCL (Hwange Colliery Company Limited) Creditors and PTA Bank among others," the report says.
"It was further noted that all the loans obtained/debts incurred should have been presented to Parliament for approval as these were acquired outside the budget. The Minister of Finance and Economic Development must cause the terms of loans contracted and guarantees to be published in the Gazette by 30 September 2019. This applies to loans and guarantees that were not previously published."
Among the recommendations made by the committee in its report are that Ncube must present the first report to parliament on the performance of loans and guarantees in 2019 by August 31 2019.
The committee further stated he should present the second report for 2019 and a comprehensive statement of the public debt in Zimbabwe at the time the estimates of revenue and expenditure for the 2020 financial year are laid before the National Assembly.
Ncube was also directed to cause the terms of loans contracted and guarantees to be published in the Government Gazette by September 30, 2019. This applies to loans and guarantees that were not previously published. The committee further said the Accountant-General should prepare a consolidated quarterly financial statement for the first and second quarter of 2019 for tabling in the National Assembly by Ncube as well as a submission to the Portfolio Committee on Budget, Finance and Economic Development for tabling and presentation to the committee by August 31, 2019 - tomorrow. From Page 1
"Zimbabwe's total debt stock is estimated at ZWL$66,8 billion as at the end of June. As at the end of June 2019, external public and publicly guaranteed debt position is estimated at US$8 billion (ZWL$58,1 billion, of which almost US$5,9 billion (ZWL$42,7 billion) is accumulated arrears.
"Multilateral institutions are owed a total of US$2,5 billion (ZWL$18,5 billion), of which the World Bank is owed US$1,5 billion (ZWL$10,6 billion), African Development Bank US$702 million (ZWL$5,1 billion), European Investment Bank US$309 million (ZWL$2,2 billion) and other multilaterals US$74 million (ZWL$535 million).
"Total bilateral debt amounted to US$5,5 billion (ZWL$39,6 billion), with Paris Club creditors accounting for US$3,5 billion (ZWL$25,1 billion) and non-Paris Club US$1,6 billion (ZWL$11,3 billion)."
When Ncube presented his 2019 national budget in November last year, he said the country's domestic debt stood at US$9,6 billion, while the total debt was US$17,6 billion. This meant external debt was US$8 billion - which it remains as now. The dramatic change, though, has been on the domestic debt. From US$9,6 billion, it is now a mere ZWL$8,8 billion (US$880 million).
"Consequently, adherence to sound fiscal and monetary policy reforms allowed containment of domestic debt stock which stood at ZWL$8,8 billion as at end June 2019, down from ZWL$9,5 billion as at December 31, 2018," Ncube said.
The Independent scrutinised and analysed Ncube's figures and discovered a staggering US$7 billion grand heist by government on domestic creditors. Further, parliament also wants accountability on a series of violations of the constitution and the law - at least 17 breaches - on public spending, resulting is massive waste of public funds.
The report reveals government's financial systems are dysfunctional and that Treasury finances are in a shambles. It also exposes a series of acts of non-compliance by the Ministry of Finance on expenditure in relation to the constitution and the law.
Laws that the Finance ministry has failed to comply with in the course of public expenditures over the past couple of years include the Public Finance Management (PFM) Act and the Public Debt Management (PDM) Act.
"Government must at all times adhere to the approved budget. The Minister of Finance and Economic Development must as a matter of urgency bring to the National Assembly, bills seeking condonation of all the unauthorised expenditure incurred since 2014. Such condonation must be sought by end of August 2019," the report says.
The report of the Pac committee - chaired by former Finance minister Tendai Biti - gives examples of 17 actions of non-compliance with the constitution and the law on public spending. Among the 17 actions are non-compliance with the provisions of section 300 (3) of the constitution in that Ncube failed to publish, in the Government Gazette, loans contracted and guarantees issued by government within 60 days of their conclusion.
The report also says Ncube did not comply with Section 300(4) of the constitution in that he failed to present to parliament a report on loans raised and guarantees issued by the state and a comprehensive report on public debt. Ncube also failed to comply with section 305(5) of the constitution in that he failed to present in the National Assembly additional or supplementary estimates of expenditure and additional or supplementary bills.
Other acts of non-compliance noted by the report include non-compliance with the provisions of Section 23(1) of the-PFM Act (Chapter 22:19) in that since 2014, the Accountant- General had failed to issue warrants under his hand, authorising accounting officers to incur expenditure up to the limits and for the purposes and subjects to conditions contained therein.
There was also non-compliance with Section 30 of the-PFM Act (Chapter 22:19) in that Treasury failed to withhold funds appropriated to ministries whose functions were assigned to other ministries and to allocate those remaining funds to other ministries or institutions as well as non-compliance with section 11(2) of the Public Debt Management Act in that the limits for government's borrowing were not fixed by the National Assembly by resolution nor by means of a provision in a Finance Bill.
According to the report, the true extent of the country's debt is unknown, with Treasury providing varying figures. As a result, Ncube has been summoned to provide accurate figures. What has worsened the chaos is that the total domestic and foreign debt of US$17,69 billion as at August 2018 reported in the 2019 budget statement was different to the US$9,2 billion reflected in the 2019 budget estimates.
"The Committee also noted that some external debts were improperly classified as domestic debt. Examples include China Nanchang Engineering, China International Water and Electricity Corporation and RBZ-/Zisco/Dutch, Mota Engil and HCCL (Hwange Colliery Company Limited) Creditors and PTA Bank among others," the report says.
"It was further noted that all the loans obtained/debts incurred should have been presented to Parliament for approval as these were acquired outside the budget. The Minister of Finance and Economic Development must cause the terms of loans contracted and guarantees to be published in the Gazette by 30 September 2019. This applies to loans and guarantees that were not previously published."
Among the recommendations made by the committee in its report are that Ncube must present the first report to parliament on the performance of loans and guarantees in 2019 by August 31 2019.
The committee further stated he should present the second report for 2019 and a comprehensive statement of the public debt in Zimbabwe at the time the estimates of revenue and expenditure for the 2020 financial year are laid before the National Assembly.
Ncube was also directed to cause the terms of loans contracted and guarantees to be published in the Government Gazette by September 30, 2019. This applies to loans and guarantees that were not previously published. The committee further said the Accountant-General should prepare a consolidated quarterly financial statement for the first and second quarter of 2019 for tabling in the National Assembly by Ncube as well as a submission to the Portfolio Committee on Budget, Finance and Economic Development for tabling and presentation to the committee by August 31, 2019 - tomorrow.
Legislators also say government - and Treasury's - accounting systems are in a shambles.
The MPs wants Ncube to appear in parliament to "seek condonation of all the unauthorised expenditure incurred since 2014".
Government has been engaging in extra budgetary expenditures without parliamentary approval.
For instance, MPs say government spent ZW$2,7 billion - which was then equivalent to US$2,7 billion in 2017; ZW$3,2 billion in 2018 and recently announced plans to spend ZW$10,85 billion - all without parliament authorisation - on top of the ZW$8 billion 2019 budget.
Parliament's demands and recommendations are contained in a report by the Parliamentary Portfolio Committee (Pac) on Public Accounts titled First Report of the Public Accounts Committee on Compliance Issues for the Ministry of Finance and Economic Development: First Session - Ninth Parliament, obtained by Zimbabwe Independent.
The legislature also wants Ncube to account for state loans and guarantees. MPs have thus given him up to September 30 - in some cases up to tomorrow - to disclose the terms and conditions of all public loans and loan guarantees that have not been published.
The legislators also queried the exact amount of Zimbabwe total debt stock.
Ncube told parliament during his mid-term budget review on August 1 that: "Zimbabwe's total debt stock is estimated at ZWL$66,8 billion as at the end of June. As at the end of June 2019, external public and publicly guaranteed debt position is estimated at US$8 billion (ZWL$58,1 billion, of which almost US$5,9 billion (ZWL$42,7 billion) is accumulated arrears.
"Multilateral institutions are owed a total of US$2,5 billion (ZWL$18,5 billion), of which the World Bank is owed US$1,5 billion (ZWL$10,6 billion), African Development Bank US$702 million (ZWL$5,1 billion), European Investment Bank US$309 million (ZWL$2,2 billion) and other multilaterals US$74 million (ZWL$535 million).
"Total bilateral debt amounted to US$5,5 billion (ZWL$39,6 billion), with Paris Club creditors accounting for US$3,5 billion (ZWL$25,1 billion) and non-Paris Club US$1,6 billion (ZWL$11,3 billion)."
When Ncube presented his 2019 national budget in November last year, he said the country's domestic debt stood at US$9,6 billion, while the total debt was US$17,6 billion. This meant external debt was US$8 billion - which it remains as now. The dramatic change, though, has been on the domestic debt. From US$9,6 billion, it is now a mere ZWL$8,8 billion (US$880 million).
"Consequently, adherence to sound fiscal and monetary policy reforms allowed containment of domestic debt stock which stood at ZWL$8,8 billion as at end June 2019, down from ZWL$9,5 billion as at December 31, 2018," Ncube said.
The Independent scrutinised and analysed Ncube's figures and discovered a staggering US$7 billion grand heist by government on domestic creditors. Further, parliament also wants accountability on a series of violations of the constitution and the law - at least 17 breaches - on public spending, resulting is massive waste of public funds.
The report reveals government's financial systems are dysfunctional and that Treasury finances are in a shambles. It also exposes a series of acts of non-compliance by the Ministry of Finance on expenditure in relation to the constitution and the law.
Laws that the Finance ministry has failed to comply with in the course of public expenditures over the past couple of years include the Public Finance Management (PFM) Act and the Public Debt Management (PDM) Act.
"Government must at all times adhere to the approved budget. The Minister of Finance and Economic Development must as a matter of urgency bring to the National Assembly, bills seeking condonation of all the unauthorised expenditure incurred since 2014. Such condonation must be sought by end of August 2019," the report says.
The report of the Pac committee - chaired by former Finance minister Tendai Biti - gives examples of 17 actions of non-compliance with the constitution and the law on public spending. Among the 17 actions are non-compliance with the provisions of section 300 (3) of the constitution in that Ncube failed to publish, in the Government Gazette, loans contracted and guarantees issued by government within 60 days of their conclusion.
The report also says Ncube did not comply with Section 300(4) of the constitution in that he failed to present to parliament a report on loans raised and guarantees issued by the state and a comprehensive report on public debt. Ncube also failed to comply with section 305(5) of the constitution in that he failed to present in the National Assembly additional or supplementary estimates of expenditure and additional or supplementary bills.
Other acts of non-compliance noted by the report include non-compliance with the provisions of Section 23(1) of the-PFM Act (Chapter 22:19) in that since 2014, the Accountant- General had failed to issue warrants under his hand, authorising accounting officers to incur expenditure up to the limits and for the purposes and subjects to conditions contained therein.
There was also non-compliance with Section 30 of the-PFM Act (Chapter 22:19) in that Treasury failed to withhold funds appropriated to ministries whose functions were assigned to other ministries and to allocate those remaining funds to other ministries or institutions as well as non-compliance with section 11(2) of the Public Debt Management Act in that the limits for government's borrowing were not fixed by the National Assembly by resolution nor by means of a provision in a Finance Bill.
According to the report, the true extent of the country's debt is unknown, with Treasury providing varying figures. As a result, Ncube has been summoned to provide accurate figures. What has worsened the chaos is that the total domestic and foreign debt of US$17,69 billion as at August 2018 reported in the 2019 budget statement was different to the US$9,2 billion reflected in the 2019 budget estimates.
"The Committee also noted that some external debts were improperly classified as domestic debt. Examples include China Nanchang Engineering, China International Water and Electricity Corporation and RBZ-/Zisco/Dutch, Mota Engil and HCCL (Hwange Colliery Company Limited) Creditors and PTA Bank among others," the report says.
Among the recommendations made by the committee in its report are that Ncube must present the first report to parliament on the performance of loans and guarantees in 2019 by August 31 2019.
The committee further stated he should present the second report for 2019 and a comprehensive statement of the public debt in Zimbabwe at the time the estimates of revenue and expenditure for the 2020 financial year are laid before the National Assembly.
Ncube was also directed to cause the terms of loans contracted and guarantees to be published in the Government Gazette by September 30, 2019. This applies to loans and guarantees that were not previously published. The committee further said the Accountant-General should prepare a consolidated quarterly financial statement for the first and second quarter of 2019 for tabling in the National Assembly by Ncube as well as a submission to the Portfolio Committee on Budget, Finance and Economic Development for tabling and presentation to the committee by August 31, 2019 - tomorrow. From Page 1
"Zimbabwe's total debt stock is estimated at ZWL$66,8 billion as at the end of June. As at the end of June 2019, external public and publicly guaranteed debt position is estimated at US$8 billion (ZWL$58,1 billion, of which almost US$5,9 billion (ZWL$42,7 billion) is accumulated arrears.
"Multilateral institutions are owed a total of US$2,5 billion (ZWL$18,5 billion), of which the World Bank is owed US$1,5 billion (ZWL$10,6 billion), African Development Bank US$702 million (ZWL$5,1 billion), European Investment Bank US$309 million (ZWL$2,2 billion) and other multilaterals US$74 million (ZWL$535 million).
"Total bilateral debt amounted to US$5,5 billion (ZWL$39,6 billion), with Paris Club creditors accounting for US$3,5 billion (ZWL$25,1 billion) and non-Paris Club US$1,6 billion (ZWL$11,3 billion)."
When Ncube presented his 2019 national budget in November last year, he said the country's domestic debt stood at US$9,6 billion, while the total debt was US$17,6 billion. This meant external debt was US$8 billion - which it remains as now. The dramatic change, though, has been on the domestic debt. From US$9,6 billion, it is now a mere ZWL$8,8 billion (US$880 million).
"Consequently, adherence to sound fiscal and monetary policy reforms allowed containment of domestic debt stock which stood at ZWL$8,8 billion as at end June 2019, down from ZWL$9,5 billion as at December 31, 2018," Ncube said.
The Independent scrutinised and analysed Ncube's figures and discovered a staggering US$7 billion grand heist by government on domestic creditors. Further, parliament also wants accountability on a series of violations of the constitution and the law - at least 17 breaches - on public spending, resulting is massive waste of public funds.
The report reveals government's financial systems are dysfunctional and that Treasury finances are in a shambles. It also exposes a series of acts of non-compliance by the Ministry of Finance on expenditure in relation to the constitution and the law.
Laws that the Finance ministry has failed to comply with in the course of public expenditures over the past couple of years include the Public Finance Management (PFM) Act and the Public Debt Management (PDM) Act.
"Government must at all times adhere to the approved budget. The Minister of Finance and Economic Development must as a matter of urgency bring to the National Assembly, bills seeking condonation of all the unauthorised expenditure incurred since 2014. Such condonation must be sought by end of August 2019," the report says.
The report of the Pac committee - chaired by former Finance minister Tendai Biti - gives examples of 17 actions of non-compliance with the constitution and the law on public spending. Among the 17 actions are non-compliance with the provisions of section 300 (3) of the constitution in that Ncube failed to publish, in the Government Gazette, loans contracted and guarantees issued by government within 60 days of their conclusion.
The report also says Ncube did not comply with Section 300(4) of the constitution in that he failed to present to parliament a report on loans raised and guarantees issued by the state and a comprehensive report on public debt. Ncube also failed to comply with section 305(5) of the constitution in that he failed to present in the National Assembly additional or supplementary estimates of expenditure and additional or supplementary bills.
Other acts of non-compliance noted by the report include non-compliance with the provisions of Section 23(1) of the-PFM Act (Chapter 22:19) in that since 2014, the Accountant- General had failed to issue warrants under his hand, authorising accounting officers to incur expenditure up to the limits and for the purposes and subjects to conditions contained therein.
There was also non-compliance with Section 30 of the-PFM Act (Chapter 22:19) in that Treasury failed to withhold funds appropriated to ministries whose functions were assigned to other ministries and to allocate those remaining funds to other ministries or institutions as well as non-compliance with section 11(2) of the Public Debt Management Act in that the limits for government's borrowing were not fixed by the National Assembly by resolution nor by means of a provision in a Finance Bill.
According to the report, the true extent of the country's debt is unknown, with Treasury providing varying figures. As a result, Ncube has been summoned to provide accurate figures. What has worsened the chaos is that the total domestic and foreign debt of US$17,69 billion as at August 2018 reported in the 2019 budget statement was different to the US$9,2 billion reflected in the 2019 budget estimates.
"The Committee also noted that some external debts were improperly classified as domestic debt. Examples include China Nanchang Engineering, China International Water and Electricity Corporation and RBZ-/Zisco/Dutch, Mota Engil and HCCL (Hwange Colliery Company Limited) Creditors and PTA Bank among others," the report says.
"It was further noted that all the loans obtained/debts incurred should have been presented to Parliament for approval as these were acquired outside the budget. The Minister of Finance and Economic Development must cause the terms of loans contracted and guarantees to be published in the Gazette by 30 September 2019. This applies to loans and guarantees that were not previously published."
Among the recommendations made by the committee in its report are that Ncube must present the first report to parliament on the performance of loans and guarantees in 2019 by August 31 2019.
The committee further stated he should present the second report for 2019 and a comprehensive statement of the public debt in Zimbabwe at the time the estimates of revenue and expenditure for the 2020 financial year are laid before the National Assembly.
Ncube was also directed to cause the terms of loans contracted and guarantees to be published in the Government Gazette by September 30, 2019. This applies to loans and guarantees that were not previously published. The committee further said the Accountant-General should prepare a consolidated quarterly financial statement for the first and second quarter of 2019 for tabling in the National Assembly by Ncube as well as a submission to the Portfolio Committee on Budget, Finance and Economic Development for tabling and presentation to the committee by August 31, 2019 - tomorrow.
Source - the independent
