The Sunday Mail
Vision 2030
Allen Choruma
What has been lacking in Zimbabwe in the past is the political will to effectively fight corruption, observe the rule of law and apply the law without bias, fear or favour.
Parastatals play a pivotal role in the economic development of Zimbabwe.
Key infrastructure and service provision is dominated by parastatals in areas such as health, roads, aviation, rail, water and sanitation, power generation and distribution, revenue collection, tourism, telecommunications, agriculture, education, financial services, and so on.
The term parastatal is used in this article in the broader context to include State-owned enterprises (SOEs) and other public institutions.
The recent wave of corruption scandals, poor performance, abuse of national resources and poor service delivery from most parastatals supports the call for parastatal reform and transformation, as the nation seeks to achieve Vision 2030’s developmental milestones.
In the past, the biggest challenge to parastatal reform has been the slow pace of implementing the reforms. There has been much talk and less action.
Vision 2030 cannot be achieved unless Government, through the State Enterprises Restructuring Agency (Sera), takes a decisive, aggressive and unwavering position in transforming parastatals and implementing robust turnaround strategies to ensure that they do not continue to make perennial losses and haemorrhage State resources that could ideally be used to support social services and developmental programmes.
The fight against corruption should be the harbinger of parastatal reform and the transformation agenda. Unless we deal with corruption effectively, the parastatal reform and transformation agenda will remain a pie in the sky.
Corruption remains the single biggest threat to reforming these entities.
Corruption
Corruption in most parastatals has reached alarming levels and the media has done a sterling job in exposing it. The Zimbabwe Anti-Corruption Commission (Zacc) has not made much progress in bringing corrupt parastatal executives and management before the courts for prosecution.
Although there has been a lot of talk about corruption, we have not had high-profile corruption cases successfully prosecuted.
In most instances, police investigations have been weak, resulting in criminal cases on abuse of office and corruption being thrown out by the courts due to lack of sufficient evidence for successful prosecution. Police investigations can only be effective if Zacc works closely with the police and other State agencies such as the National Prosecuting Authority (NPA), who are constitutionally mandated to fight corruption.
Laws and Institutions
Zimbabwe has sufficient laws and institutions to fight corruption in all sectors — public and private — and within the broader Zimbabwean society.
At institutional level, we have the Judiciary (courts), the Zimbabwe Republic Police (ZRP), Zimbabwe Anti-Corruption Commission (Zacc) and the National Prosecuting Authority (NPA).
There is also a Special Anti-Corruption Unit (Sacu) within the Office of President and Cabinet (OPC), which is also designed to deal with corruption. Within the NPA, there is the Asset Forfeiture Unit, which was established in terms of Section 27A of the National Prosecuting Authority Act.
The Financial Intelligence Unit (FIU) was established under the Money Laundering and Proceeds of Crime Act (Chapter 9:24) and operates under the Reserve Bank of Zimbabwe (RBZ).
The FIU’s responsibility is primarily to scrutinise suspicious financial transactions within banking and financial services with the objective of curbing illicit financial activities and money laundering.
In terms of legal instruments, we have the Prevention of Corruption Act (Chapter 9:16); Zimbabwe Anti-Corruption Commission Act (Chapter 9:22); National Prosecuting Authority Act (Chapter 7:20); Money Laundering and Proceeds of Crime Act (Chapter 9:24); Exchange Control Act (Chapter 22:05); Presidential Powers (Temporary Measures) (Amendment of the Money Laundering and Proceeds of Crime Act and Exchange Control Act) Regulations, 2018 (SI 246 of 2018); and the Criminal Law (Codification and Reform) Act (Chapter: 9:23), among others.
SI 246 of 2018 — Presidential Powers (Temporary Measures) cited above — empowers Government to seize assets of people who fail to disclose the source of their wealth. The regulations allow authorities to make an ex-parte application to the High Court for Unexplained Wealth Order (UWO) in respect of any property presumed to be “tainted”.
The High Court may grant the UWO if it is satisfied that the requirements for making the order are fulfilled.
Therefore, Zimbabwe’s failure to make significant progress in fighting corruption is not because of inadequate institutions and laws to fight corruption. These are in place. Zimbabwe sticks out in Southern Africa as having a robust institutional and legal framework to fight corruption.
What has been lacking in Zimbabwe in the past is the political will to effectively fight corruption, observe the rule of law and apply the law without bias, fear or favour.
Laws to fight corruption have in the past been applied selectively and in a biased manner; thus compromising the effectiveness of existing measures to fight corruption. What is encouraging is that His Excellency, President Mnangagwa, has set the “right tone from the top” on the need to fight corruption.
The institutions entrusted with the legal authority to expose, investigate and prosecute cases of corruption have the Presidential support to do so and therefore there is no excuse for not using our institutional and legal framework to fight corruption in Zimbabwe.
Government reforms
Transforming and reforming parastatals is broader and extends beyond fighting corruption.
Sera, for example, in October 2017 issued “Turnaround Strategy and Entity Self-Assessment Guidelines for adoption by SOEs and Parastatals”.
These guidelines are meant to improve disclosures and reporting standards in parastatals in areas such as governance, turnaround strategies, financial performance, debt restructuring, revenue enhancement and cost containment, among others.
The following are some of the parastatal reform measures that Government has already announced:
- Governance: enhancing governance through enactment of the Public Entities Corporate Governance Act (Chapter 10:31).
- Director Database: Corporate Governance Unit: Office of President and Cabinet (OPC) is creating a directors’ database (pool) for parastatal board appointments.
- Recapitalisation Programme: (for example, NRZ, Zesa).
- Liquidation: outright liquidation of selected parastatals (for example, National Glass, Kingstons)
- Mergers: (for example, Powertell, Zarnet and Africom), JVs, absorption into ministries: (for example, Ziana).
- Privatisation: (for example, TelOne, NetOne, POSB, IDC, CSC, Zupco, Agribank).
- Oversight: increased oversight over financial performance and service delivery.
Other reforms
In addition to Government-driven parastatal reforms, the reform agenda should be broadened to include the following:
- Publishing annual financial statements in mainstream media and other public platforms.
- Convening Annual General Meetings.
- Public selection of directors of parastatals, through advertisements, co-ordinated by the Corporate Governance Unit in the Office of President and Cabinet (OPC).
- Limit tenure of CEOs of parastatals to ten years (that is a maximum of two five-year tenures).
- Performance-based contracts for CEOs and senior executives and management.
Parastatal boards should be properly constituted as a matter of public policy.
The appointment of directors is an even more rigorous exercise in parastatals because the directors will be called to preside over public assets and resources. Parastatal directors should be appointed through a formal and transparent process to ensure that such directors have the requisite qualifications, skills, competencies, experience and independence.
Parliament
In the interests of public policy, Parliament, through its Parliamentary portfolio committees, should exercise its oversight role over parastatals more effectively.
Parliament should be more assertive and ensure that parastatals stick to their statutory mandates and that they are governed in line with best practices to safeguard public resources and enhance service delivery and economic development.
Parliament should also ensure that the Auditor-General’s reports are taken seriously and that recommendations are actioned.
In conclusion, parastatal reform and transformation should be accelerated to ensure that these entities serve their statutory objectives of advancing social and economic development goals while at the same time operating viably and efficiently without burdening the fiscus and taxpayers.
Allen Choruma can be contacted on [email protected]
