ED warns dodgy public sector suppliers

Chris Mahove

President Emmerson Mnangagwa (pictured) has warned Public Sector suppliers who price their goods and services using black market rates that the long arm of the law will soon catch up with them and they risk both black-listing and arrest.

President Mnangagwa, writing in his weekly column, ‘Non but Ourselves’ in a local weekly, singled out players in the fuel and hospitality industries as well as big companies participating in government tenders.

“A quick check has revealed the bulk of our fuel needs are being met from private players. Ordinarily that should not be a problem, provided the pricing is right. This has not always been the case, and in most cases has been grossly abused. The pricing of fuel coupons by these private players has been based on extortionate huge mark-ups, and on black market rates of anything between $900 to $1000 per USD.

“Meekly, the Public Sector, which accounts for over 70 percent of fuel purchases in the market, has been a price-taker! Even players who obtain their fuel from our NOCZIM at official rate and at prices gazetted by our own ZERA have been abusing ministries, departments and agencies using the same extortionate pricing formulae. That way, billions of dollars have been paid out to these devious suppliers,” he said.

He said it was gross imprudence on procurement by the Public Sector that it used lots of fuel which was often bought from private fuel suppliers through a coupon system, despite the fact that the Public Sector had arms which dispensed and sold fuel to the public.

“What these extortionate suppliers then do is to pay off NOCZIM at gazetted prices, and using the official exchange rate. The rest of the monies from such extortionate sales then find way into the black market, thus precipitating the exchange rate turbulence that has been buffeting the whole economy,” he said, adding that this had made Government an accessory in the flouting of its own laws in the market.

President Mnangagwa said travel agents and hoteliers were also abusing the facility by charging government officials flying from Harare to Victoria Falls $699 000 or more a-piece for tickets using the black-market rate.

“At the official rate, this amounts to more than US$1 500 a ticket to Victoria Falls! This is close to what it costs an air traveller in economy class to fly to Europe! Meanwhile, Air Zimbabwe, the sole carrier of Government delegations, only charges about US$300 a ticket! The issue is what happens to the huge difference? It finds its way into the black market,” he said.

He said a random check had shown that such abusive pricing in respect of procurements of goods and services by the Public Sector was more of a rule than an exception, thus, destabilizing the country’s financial services, with the Public Sector being an unwitting player.

“I have now directed the Fiscal Ministry to send back all invoices from Government ministries, departments and agencies for thorough re-validation before payment. Any accounting officer who allows such pricing malpractices to escape their gaze will be deemed criminally negligent and thus personally liable in terms of our Public Finance Management Act (Chapter 22:19),” he said.

The President said government had also acted against big companies participating in government tenders, as part of its bold, corrective measures, adding those who continued to be dodgy risked being blacklisted.

“In future, we will not hesitate to blacklist such wrongdoing companies from Government tenders. Their association with Government must place their actions above any reproach. No public resources will be used to finance economic hitmen and women,” he said, adding there were no scared cows.

President Mnangagwa said many things had been going wrong in the public sector, which should be leading by example, given that its buying power accounted for 70 percent of the demand for goods and services in the country’s economy.

“Much worse, it is the governing sector! With such a preponderant procurement role in the Economy, and such high responsibility to show exemplary conduct, it goes without saying that what the Public Sector does, or fails to do right, impacts the whole economy, whether for better or for worse. I am determined that the impact of the whole Public Sector on the National Economy remains wholesome and supportive, indeed inspiring to all actors,” he said.

ED warns dodgy public sector suppliers

Chris Mahove

President Emmerson Mnangagwa (pictured) has warned Public Sector suppliers who price their goods and services using black market rates that the long arm of the law will soon catch up with them and they risk both black-listing and arrest.

President Mnangagwa, writing in his weekly column, ‘Non but Ourselves’ in a local weekly, singled out players in the fuel and hospitality industries as well as big companies participating in government tenders.

“A quick check has revealed the bulk of our fuel needs are being met from private players. Ordinarily that should not be a problem, provided the pricing is right. This has not always been the case, and in most cases has been grossly abused. The pricing of fuel coupons by these private players has been based on extortionate huge mark-ups, and on black market rates of anything between $900 to $1000 per USD.

“Meekly, the Public Sector, which accounts for over 70 percent of fuel purchases in the market, has been a price-taker! Even players who obtain their fuel from our NOCZIM at official rate and at prices gazetted by our own ZERA have been abusing ministries, departments and agencies using the same extortionate pricing formulae. That way, billions of dollars have been paid out to these devious suppliers,” he said.

He said it was gross imprudence on procurement by the Public Sector that it used lots of fuel which was often bought from private fuel suppliers through a coupon system, despite the fact that the Public Sector had arms which dispensed and sold fuel to the public.

“What these extortionate suppliers then do is to pay off NOCZIM at gazetted prices, and using the official exchange rate. The rest of the monies from such extortionate sales then find way into the black market, thus precipitating the exchange rate turbulence that has been buffeting the whole economy,” he said, adding that this had made Government an accessory in the flouting of its own laws in the market.

President Mnangagwa said travel agents and hoteliers were also abusing the facility by charging government officials flying from Harare to Victoria Falls $699 000 or more a-piece for tickets using the black-market rate.

“At the official rate, this amounts to more than US$1 500 a ticket to Victoria Falls! This is close to what it costs an air traveller in economy class to fly to Europe! Meanwhile, Air Zimbabwe, the sole carrier of Government delegations, only charges about US$300 a ticket! The issue is what happens to the huge difference? It finds its way into the black market,” he said.

He said a random check had shown that such abusive pricing in respect of procurements of goods and services by the Public Sector was more of a rule than an exception, thus, destabilizing the country’s financial services, with the Public Sector being an unwitting player.

“I have now directed the Fiscal Ministry to send back all invoices from Government ministries, departments and agencies for thorough re-validation before payment. Any accounting officer who allows such pricing malpractices to escape their gaze will be deemed criminally negligent and thus personally liable in terms of our Public Finance Management Act (Chapter 22:19),” he said.

The President said government had also acted against big companies participating in government tenders, as part of its bold, corrective measures, adding those who continued to be dodgy risked being blacklisted.

“In future, we will not hesitate to blacklist such wrongdoing companies from Government tenders. Their association with Government must place their actions above any reproach. No public resources will be used to finance economic hitmen and women,” he said, adding there were no scared cows.

President Mnangagwa said many things had been going wrong in the public sector, which should be leading by example, given that its buying power accounted for 70 percent of the demand for goods and services in the country’s economy.

“Much worse, it is the governing sector! With such a preponderant procurement role in the Economy, and such high responsibility to show exemplary conduct, it goes without saying that what the Public Sector does, or fails to do right, impacts the whole economy, whether for better or for worse. I am determined that the impact of the whole Public Sector on the National Economy remains wholesome and supportive, indeed inspiring to all actors,” he said.

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