Zinara rot: Govt takes action

via Zinara rot: Govt takes action | The Herald January 7, 2015

Government has directed the Zimbabwe National Roads Administration board to take over the day-to-day management of the authority to stamp out the rot in the debt-ridden parastatal.This follows reports of alleged gross misappropriation of funds and lack of good corporate governance which left Zinara with a cumulative debt of $40 million as of November last year.

Transport and Infrastructural Development Minister Dr Obert Mpofu confirmed yesterday that he had given the board permission to take over operations.

He said activities by the management were severely compromised and needed close monitoring.

“This is per instruction. We have directed the board to monitor the activities of management on a regular basis as instructed by Cabinet. We as ministers have been directed to monitor the activities of boards on a regular basis and how else can you do that without getting the people that are expected to do that job away from the scenario?

“These are public institutions and the public is entitled to know what is happening, but not through mysterious informants. We want functional boards not passive boards. That is why there is activity in Zinara now. You can’t compare Zinara of now to that of yesterday. The little activity that is happening in this economy is from our side,” said Dr Mpofu.

The Herald had asked Zinara board chairman Mr Albert Mugabe why board members were frequenting the authority’s Highlands offices daily and “having endless meetings.”

“Your question insinuates that Mr (Moses) Juma (acting Zinara CEO) is redundant,” said Mr Mugabe.

“He is very active. We are there on oversight policy and to make sure the direction we want to go is being followed. It’s his ship, he is steering it in the direction we want to go but to say we are running…”

Minister Mpofu interjected and said: “There is nothing wrong with  that. You are doing it and I authorised it.”

Sources yesterday said the board had taken over the managerial roles to the extent of “approving day-to-day payments and instructing the authority where to buy fuel and other consumables from.”

“They are also refusing to settle other accounts, which would be in very dangerous state in terms of age analysis and also in terms of the accounts lapsing. The board members are now giving instructions directly to management and overriding the acting CEO. He has been rendered useless,” said the source.

Despite being in arrears, Zinara collects around $130 million annually from road access fees, vehicle licensing, transit fees and fuel levy.

Corporate governance experts said it was “indecorous” and “dangerous for the board to run the parastatal as it could end up conniving with management to abuse funds and resources.

“Remember there have to be checks and balances and who will supervise the board?” said one expert.

“There has to be a gap with the board formulating policies and giving guidance while management should implement those policies to add value to the shareholder investment. What if there is connivance between the management and the board.”

The corruption at the parastatal has seen Zinara director of administration, Mr Precious Murove, being implicated in a case in which the authority entered into a contract with Univern Enterprises in November 2012 for the supply of 40 graders valued at $8 million.

In an apparent violation of the Companies Act, Mr Murove signed the contract on behalf of Univern while former chief executive Mr Frank Chitukutuku represented Zinara.

Mr Murove’s conduct raised ethical and procedural questions as the law stipulates that it is wrong for the receiver of a service to sign on behalf of the service provider.

It has also emerged that a company owned by Mr Murove was offering cleaning services at Zinara offices, further casting doubt on the authority’s corporate governance.

Mr Murove has been evasive since Monday, at one time he said he had prepared a statement for this paper but it was not delivered.

 

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