Demand accountability, transparency in public sector

Source: Demand accountability, transparency in public sector – NewsDay Zimbabwe July 12, 2017

THE Auditor-General’s (AG) 2016 reports of audited financial statements of State enterprises and parastatals (SEPs) stirred public excitement as hidden issues of rampant abuse of public funds by government departments and parastatals were unravelled.


But, the question is: Then what after the disclosures? The government has always failed to act on the revelations and those implicated for corruption have never been arrested.

Of keen interest in the 2016 audit reports were revelations by the AG that some of the mines that are supposed to be cash cows for the national fiscus were actually technically insolvent according to their financial statements.

Jena Mines, wholly-owned by the government, recorded a $4,7 million-loss before tax and has liabilities outstripping its current assets by $17,6 million, which means their balance sheet is unhealthy.
AG Mildred Chiri raised doubts on the mine as a going business concern.

Another case is that of the Zimbabwe Mining Development Corporation (ZMDC), which spent $25 228 in board expenses within two years, yet they did not have an existing board, incurring a net loss of $10 million in 2011, which increased to $56 million in 2013. Its current assets were said to outstrip its current liabilities by $131 million.

Given such scenarios, where government entities continue to be loss-making and lacking accountability and transparency, civic society groups, including the Zimbabwe Environmental Law Association (Zela), feel citizens need to scrutinise the AG’s audit reports and recommendations by parliamentary portfolio committees to the executive so they can demand answers and accountability.

At a Zela workshop held on Friday, director Shamiso Mtisi said civic society needs to interrogate the AG’s reports and help the office to hold to account SEPs abusing public funds.

“Citizens have a constitutional right to participate in access to information on the AG’s reports and to hold to account decision-makers and SEPs because the Constitution is very clear on issues of financial probity, transparency and accountability,” he said.

“Parliament and civic society must be able to identify the missing gaps in the AG’s reports. Zela has started working on a programme to develop a system of monitoring the AG’s reports so that we track implementation of recommendations made in the reports. We also need to look at how we can make the AG’s reports reader friendly.”

Although the AG’s reports have recommendations on how ministries and parastatals can maintain financial discipline, all audit reports produced since 2011 have raised the same issues of misuse of funds.

Zela economic and governance officer, Mukasiri Sibanda, said there was need to point out the recurrent abuses.

“However, some of the issues raised in the AG’s reports cannot stand as evidence in a criminal court of law. While we celebrate the AG Chiri for meeting her mandate in timeously producing 2016 audit reports, we also need to realise that there are some SEPs that have remained truant and have not been bringing forward their financial records for scrutiny by the AG,” he said.

Sibanda said citizens and civil society must then demand truant SEPs oblige with the Public Finance Management Act and publish their financial statements for public scrutiny, transparency and accountability.

“We need to look at aspects of timeliness of the information from the AG’s reports, credibility and accessibility of financial statements of the SEPs. For example, the latest financial statements from ZMDC are for the years 2011 and 2012, and what do we do with that old data?” he said.

“The financial statements of these parastatals are not publicly accessible and we still do not have a complete picture of their books. For example, ZMDC got an adverse opinion from the AG because their share certificates and joint venture certificates could not be found. There was no information on the value of their mineral rights — and how does one negotiate a contract when the value of the mineral resources is unknown?”

Sibanda said the AG also could not get proof of how much diamonds were sold by Anjin and this was proof of lack of transparency in the mining sector.

“However, it is not too late for the people of Zimbabwe and civic society to go back and demand information of how much diamond exports were made and that financial statements must be published. If the AG’s Office has such challenges in getting financial statements, what more us as ordinary citizens?” he queried.

Sibanda said Zimbabwe’s ballooning debt situation can, to a large extent, be accredited to loss-making SEPs in the mining sector.

He pointed out some shortcomings in the AG’s reports, saying there is need for a special audit minerals agency with expertise to audit mining revenue.

The reasons, Sibanda said, were that the 2016 AG reports failed to look at issues of environmental degradation in the mining sector.

Mabvuku-Tafara MP, James Maridadi said whenever Parliament sits to scrutinise the AG’s reports and quiz government officials and parastatal bosses, officials from the AG’s Office and Finance ministry will be present.

“We have been calling for that, the Zimbabwe Republic Police officers and the Zimbabwe Anti-Corruption Commission must sit with the committee (Public Accounts Committee) so that when they note issues of fraud, they begin to investigate. In countries like Kenya, their police fraud squad sits with the Public Accounts Committee (PAC) and as soon as the AG’s reports are discussed they begin to investigate,” he said.

The opposition legislator, who also sits in the PAC, said other shortcomings were that the committee’s investigations ended up being talk shows, with no implementation of their recommendations by ministries and SEPs.

“The problem in Zimbabwe is our toxic politics. Special audits can be made at SEPs, but it is the government that is being audited, and the government will never allow itself to be audited. The ZRP also need someone to file a complaint, and so it means that someone must rise from the PAC and report government officials suspected of fraud,” he said.

Policy analyst, Richard Mambeva, said it is high time citizens demanded their rights and got involved with policy-makers to demand accountability and transparency in public funds.

“The aim of civic engagement is to stimulate demand from citizens to put pressure on the State and private sector to meet their obligations to demand quality services. Citizen’s influence in setting of development priorities ensures that government policies are people-centred and ensure the needs of citizens are met,” he said.

Mambeva said there is need for citizens’ engagement to publicise the AG’s reports whenever they are tabled before Parliament so that they know how resources are allocated and used.