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Parly urged to scrutinise loan agreements

by Staff reporter
25 May 2021 at 07:19hrs | Views
LEGISLATORS have been urged to scrutinise loan agreements entered into by government after President Emmerson Mnangagwa recently signed the Constitution of Zimbabwe Amendment (No 2) Bill into law.

The constitutional amendments that were effected included provisions to do with Parliament's power to scrutinise loan agreements.

Initially, there was a proposal that clause 23 of the Bill would clip Parliament's powers to scrutinise loans so that it only scrutinises State-toState loans, and not those entered into with non-State institutions such as banks.

The contentious clause was then repealed and substituted with clause 21, which now asserts that any international treaty entered into by the President or under his authority with one or more foreign organisation or entities and imposes fiscal obligations on Zimbabwe does not bind Zimbabwe until it has been approved by Parliament.

Civic organisations such as the Zimbabwe Coalition on Debt and Development (Zimcodd), which were vociferous in opposing the initially proposed clause 23 of the constitutional amendment, has urged legislators to exercise their watchdog role by interrogating financial activities in the public sector.

In a statement, Zimcodd said this entailed careful scrutiny of the budget, as well as all loan agreements entered into outside the budget process as stipulated by section 300(3) and (4) of the Constitution.

Section 300(3) of the Constitution reads: "Within 60 days after the government has concluded a loan agreement or guarantee, the minister responsible for Finance must cause its terms to be published in the Gazette," while section 300(4) reads: "The minister responsible for Finance must (a) at least twice a year, report to Parliament on the performance of (i) loans raised by the State; and (ii) loans guaranteed by the State."

The civic organisations said failure by Parliament to scrutinise international treaties and loan agreements would worsen the country's debt situation.

Zimcodd said MPs should take advantage of the substituted clause 21, which strengthens Parliament's oversight role, allowing it to scrutinise international treaties and loan agreements.

"It remains incumbent upon Parliament to effectively exercise its oversight role on the Executive in order to safeguard the principles of separation of powers, public accountability and good governance, bearing in mind that independent and democratic parliamentary oversight is a key tenet of representative democratic systems and constitutional order, and Parliament must now be more interested in the Finance Bill," Zimcodd said.

The watchdog body also urged the public to be involved in civic programmes so that they demand accountability in the use of public funds in order to achieve social and economic justice.

Zimcodd said good parliamentary oversight on loan agreements would reduce the country's debt burden.

Recently, Finance minister Mthuli Ncube brought a US$10,6 billion Condonation Bill before Parliament to seek forgiveness for over-expenditure.

Source - newsday

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