The Committee observed the following developments on site: two temporary housing structures and partial clearing of the ground. The following work for which payments had been released and not yet completed included: a proper access road, basic ablution facilities, communication network, electricity, water sitting and borehole drilling and storage.
Within the contract, it is a requirement that “monthly progress reports shall be prepared and submitted to the Employer….”In this case, Intratrek was supposed to submit monthly reports either as hard copies or in electronic form to ZPC of the work done. It is the Committee’s position that this was not done at all. ZPC just made payments blindly without due care on whether the money was being used for its intended purpose. In some cases, two trenches of money totalling 700 000 were released in one day and in some cases monies were released a few days apart. It is the Committee’s position that the rate and frequency at which the money was released was very suspicious. It violates basic principles of the public finance management. Section 298 (d) of the Constitution states that “public funds must be expended transparently, prudently, economically and effectively’. This should be read together with section 44 of the Public Finance and management Act which implores upon an accounting officer of a public entity to “prevent irregular expenditure, fruitless and wasteful expenditure, losses resulting from criminal conduct and expenditure not complying with operational policies of the public entity”.
It is the Committee’s position that Mr. Chivayo may have failed to get a bank guarantee because of his previous criminal conviction. At the same time, it boggles the mind on why Mr. Chivayo failed to get guarantee from his technical partner Chint Electric, which he boasted was a multi-million dollar company with a footprint across the globe.
3.4 Corporate Governance at ZESA Holdings
The ZPC has the responsibility of managing the generation of electricity in the country as outlined in the Electricity Act Chapter 13:05. However, the Committee noted with concern that the ZPC and ZESA Holdings Board and its management were found wanting in the evaluation, execution and monitoring of this project. These were the areas of concern:
3.4.1 Discord between the ZPC Board and the Management
It was clear to the Committee during the oral evidence sessions that there was discord between the management and the Board. Firstly, the Managing Director, Mr. Gwariro released over $5.6 million for pre-commencement works without the knowledge of the Board. Secondly, the Managing Director was given legal advice by the Board Secretary of ZPC on the de-merits of engaging Intratrek given the previous conviction of its director Mr. Chivayo. Instead the Managing Director acted against the sound legal advice and engaged Intratrek as its contractor. Furthermore, the Committee was informed that the Managing Director acted without consulting the Board because of pressure from politicians that included former Ministers of Energy, Mr. Mavhaire, Mr. Mangoma, Mr. Mutezo and Dr. Undege. However, Mr. Mutezo who appeared before the Committee denied exerting any influence to advance the interest of Mr. Chivayo. It was also clear from the Finance Committee Chairperson of the ZPC Board that the release of money was done without its knowledge and approval and could also be the reason why money was being paid in installments rather than a wholesome payment.
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