Recover $35m, says House

Source: Recover $35m, says House | The Herald July 7, 2016

Lloyd Gumbo Senior Reporter
The Parliamentary Portfolio Committee on Public Accounts says Government must recover about $35 million that was loaned to State parastatals and enterprises through the Infrastructure Development Bank of Zimbabwe in 2010.

The committee chaired by MDC-T MP for Mufakose Paurina Mpariwa, made these recommendations in its third report on the findings by the Auditor-General on the 2014 appropriation accounts for the Ministry of Finance and Economic Development presented in Parliament last week.

“Out of a total of $70 460 000 loaned out to various institutions through the IDBZ Bank since year 2010, only an amount of $21 628 420 had been repaid at the time of audit,” said the committee.

“The Accountant-General advised that the entities will require major policy reforms aimed at improving their income generating capacity.

“Notably, National Railways of Zimbabwe (NRZ) got $5 million, Civil Aviation Authority of Zimbabwe (CAAZ) $18,1 million, the Zimbabwe National Water Authority (ZINWA) $7 million and Registrar General’s Office $3,5 million and had not made a single contribution towards repayment.

“The Zimbabwe National Road Authority (ZINARA) got $10,3 million and had paid back $1,7 million. Going forward, every entity benefiting from the fiscus will be required to set up a sinking fund with clear indications on repayments.”

The committee said given that the IDBZ was not a going concern, it could not understand why Government did not disband it.

“The committee recommends that Treasury should by September 31, 2016, provide an explanation to the committee why it was maintaining IDBZ given its perennial financial woes.

“Furthermore, of the institutions highlighted, save for the Registrar-General’s Office and ZINARA, all had going concern issues and Government should with immediate effect, stop lending funds to non-performing entities.

“Government should with immediate effect institute recoveries from entities such as ZINARA since it was collecting a lot of revenue,” said the committee.

The committee also found that Treasury made direct payments to some service providers worth about $180 million on behalf of line ministries.

“Treasury informed the committee that such payments were made on the strength of confirmation by directors of finance in line ministries, service providers and the Zimbabwe Revenue Authority (ZIMRA).

“On the other hand, line ministries alleged that such payments were made without their knowledge and as a result, they were not able to capture the payments on their books.

“The challenge posed by direct payments is that they violate the principle of double entry in that only the PFMS reflects the transactions while ministries sub-Paymaster General accounts are not charged with the expenditure,” said the committee.