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Analysis

Auditor-General lays bare shocking govt corruption

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AUDITOR-GENERAL (AG) Mildred Chiri’s 2019 reports tabled in parliament last week exposed, yet again, a litany of corporate governance failures in government departments, parastatals and local authorities, resulting in the loss of billions of taxpayer dollars.

DUMISANI NYONI

For instance, Chiri’s report on Appropriation Accounts and Fund Accounts for the year ended 31 December 2019 reveals that President Emmerson Mnangagwa’s government gobbled up nearly ZW$7 billion in unauthorised expenditure owing to a lack of accountability in line ministries.

The figure exceeded the approved budget of ZW$580 655 000, thereby contravening section 305(5) of the constitution. In 2018, the figure stood at ZW$2 billion, as the government, which was supposed to spend ZW$4.6 billion from the consolidated account, ended up blowing ZW$7.1 billion.

The AG’s reports laid bare the deep-seated corruption and maladministration at the heart of the government’s shoddy financial management.

In a law-abiding society, the dictates of accountability would see to it that the officials implicated in corruption and maladministration are investigated and brought to justice. In many instances, there is sufficient evidence for prosecution.

But year in and year out, the AG’s reports reveal serious irregularities which are swept under the carpet, showing the government’s lack of will to fight corruption.

The failure by the government to adhere to legal provisions on the sanctioning of excess expenditure by Parliament substantiates the lack of political will to deal with challenges of poor corporate governance, according to the Zimbabwe Coalition on Debt and Development (Zimcodd)’s analysis of the last AG report.

Zimcodd said there is the need for watertight public finance management legislation which provides for the sanctioning of those found on the wrong side of the law.

Public finance expert Stevenson Dhlamini said there is a lack of commitment in implementing the recommendations of the AG which are meant to ensure transparency and good governance, among other constitutional imperatives.

For instance, the report reveals that out of the 356 recommendations made by the AG in 2018, only 26% were fully implemented, 25% partially implemented and 49% were not implemented at all.

The same trend can be witnessed from the 435 recommendations made in 2017 where 25% were fully implemented, 19% partially implemented and 56% not implemented at all.

“The enabling legislation is that both the constitution and the Audit Office Act do not avail to the AG powers to compel and make it mandatory for ministers and government departments to observe and comply with the instructions of Treasury,” Dhlamini said.

He said appointments to important posts are made on the basis of politics instead of meritocracy in most of Zimbabwe’s parastatals. This is the remain why these state entities are failing to cooperate or fail to submit returns to the AG.

“The Zimbabwean public sector is very much politicised as evidenced by the presence of ex-military officers serving as parastatal bosses and as a result these have been regarded as retirement zones,” he said.

“Public sector politicisation has two main effects to sound public sector auditing and the first one is that it erodes the sense of obligation to comply with the regulations and the second one is that it reduces the Auditor-General’s effectiveness in the exercise of his or her duties by inducing fear to objectively scrutinise these entities precisely because those at the helm are politically connected,” Dhlamini said.

He said due to lack of enforcement mechanisms, there has been a re-occurrence of similar or identical irregularities in most government ministries as well as state-owned enterprises as matters or audit reports are swept under the carpet.

“Such a scenario is a clear indication that observations of the Auditor-General and recommendations are not being implemented at all,” he said.

“The law does not provide enforcement mechanisms with regard to audit recommendations and this impacts negatively on the ability of the audit office in producing the annual reports as well as meeting statutory deadlines for tabling of such reports in Parliament.”

Dhlamini said audit recommendations must state a clear, convincing, and workable basis for implementation. Their utility and continued relevance should be re-evaluated as follow-up actions progress, he said.

Auditor-General Chiri said she noted variances between the schedule of unallocated reserve transfers from Treasury and the received transfer schedules of the same from the individual line ministries.

The variances needed to be reconciled. She said she raised this issue in her prior year reports, but the malpractice is recurring.

The AG also said the Finance ministry made direct payments to various ministries without proper documentation, a practice open to manipulation.

The Health ministry was also red-flaged for unsupported expenditure and paid money to suppliers of goods and services without supporting documents.

Economist Prosper Chitambara said the AG’s findings show that there is a lot of work that needs to be done in terms of strengthening institutional capacity within government in general.

“I think weak institutions have resulted in some of these leakages that the report is alluding to. So, we need to ensure that we have strong public institutions and infrastructure that are actually able to disincentivise or to close those loopholes,” he said.

“Here we are talking of issues of institutions that ensure there is transparency, especially in terms of the financial management and obviously also strengthening the role of Parliament to hold the executive to account. For me, it’s a question of institutions. That’s where we get it wrong or right,” Chitambara said.

Independent economist John Robertson said if the report had come out in 2020 and swift penalties had been applied, the behaviour last year and this year might have improved enormously.

“Such a long delay in issuing the 2019 report means that behaviour will not have changed in 2020 or this year so far,” Robertson said.

“If the new administration is to make a difference to the trustworthiness of public sector employees as well as politicians, it will have to react much faster to any signs of corruption or inefficiency. Speedy and decisive action, accompanied by severe penalties, will combat this behaviour very effectively,” he said.

Dhlamini said the Zimbabwe Anti-Corruption Commission should be armed with prosecuting powers guaranteed by the constitution while the judiciary should be independent and must be able to interpret the law without fear or favour.

This, he said, would help combat corruption.

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