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Govt delays payment to contractors

by Staff reporter
05 Dec 2022 at 05:05hrs | Views
The delays in paying contractors is a result of the due diligence which the government has to carry out after some of them were charging extortionate prices, a cabinet Minister has said.

Minister of Presidential Affairs and Monitoring Implementation of Government Programmes Jorum Gumbo said this last week after touring the Gwayi-Shangani water pipeline project as well as the National Railways of Zimbabwe (NRZ) coach and wagon refurbishment centre.

The government in August this year directed all Ministries, departments and agencies (MDAs) to suspended payments to service providers as part of efforts to halt a slump in the local currency which was fuelling hyperinflation.

Finance and Economic Development permanent secretary George Guvamatanga issued the directive after the Treasury had noticed that some of the contractors were submitting invoices of cash for goods and services using parallel market rates.

The MDAs are required to seek approval from Treasury for current and future contract pricing and share with it their due diligence on existing charges.

"I have taken note of the challenges that are impeding the smooth implementation of the project. In particular, my attention has been brought to the fact that the contractors were last paid at the beginning of the year and that the advance payment for the contractors and pipe procurement are always not being disbursed in time," said Gumbo.

"Allow me to point out that Government has been fighting the scourge of extortionate pricing by service providers including some contractors, which leads to distortions in the economy.

"As a result, slight delays have been experienced in payment to service providers because Government has to carry out due diligence process."

The Second Republic is implementing the construction of the Gwayi-Shangani Dam and pipeline which was first mooted in 1912 but failed to take off under previous successive administrations.

When complete, the pipeline will have the capacity to convey in excess of 160 000 mega litres of water to the city of Bulawayo annually.

Gumbo urged local communities to participate in the project through taking up employment opportunities in various aspects of its implementation.

"In my view, community participation promotes a strong sense of ownership for the project. The rapid development that we seek to achieve through the 100-Day Cycle Programme can only be achieved if communities are allowed to actively participate in the projects as opposed to being passive beneficiaries," he said.

Touring to the NRZ, Gumbo said a lot still needed to be done to turn round the fortunes of the entity.

He said it was critical that the NRZ be resuscitated as Zimbabwe was located centrally in the region, which made it easier to move bulk cargo between countries.

Source - New Ziana.