The rot in Zimbabwe’s Ministry of Transport

4.1.2.1 The Committee recommends that the Ministry should submit to Parliament the reconciliations with the supporting documentation by 1stAugust, 2017.

4.1.3  Understated Expenditure

The Audit observed that Treasury made direct payments to service providers amounting to $2 762 669 on behalf of the Ministry while the Appropriation Account submitted by the Ministry reflected an amount of $2 590 004 for direct payment resulting in a variance of $172 695.

The Permanent Secretary informed the Committee that the Ministry had investigated and found out that the direct payments made by Treasury as per Treasury records were correct and the payments were made to ZINWA. The matter has therefore been addressed to the Committee’s satisfaction.

4.1.4 Suspected Fraud

An Internal Audit Report revealed that between January 2012 and May 2014, the Ministry suffered a loss of $181 950 through fraudulent activities perpetrated by an Accounts Clerk at the Victoria Falls station. The Accounts Clerk resigned when the fraud was uncovered to avoid prosecution. At the time of concluding the audit, no action had been taken by the Ministry whereas Treasury Instruction 0435 requires that a police report be made immediately after preliminary investigation into such kind of loss pointing to criminal action.

The Permanent Secretary informed the Committee that the fraud had not been detected until after the audit. The Ministry suspected that there was connivance between the Vehicle Inspection Department (VID) official and a bank employee.  It was a question of under-banking which was concealed by the two individuals involved which went on for some time. The Permanent Secretary also indicated that the official absconded from work after the matter was reported to the Police. He went further to state that the Ministry had instructed Pension Office to stop disbursement of terminal benefits accruing to the former employee as part of efforts to recover the defrauded funds. However, terminal benefits were far too little considering the amount in question.

To strengthen internal controls, the Permanent Secretary informed the Committee that the Civil Service Commission had appointed two accountants to perform receipting duties and prevent such function from being performed by Vehicle Inspection Department inspectors as was the practice.

The Committee noted with concern that no proper care was being taken by the Ministry to safeguard public funds. Where under qualified personnel are entrusted with public funds, the Committee expects the Ministry to ensure constant supervision. The fact that the Ministry admitted that it took long for it to detect the fraud, points to lack of supervision in the Ministry. There is a danger that Government might be losing a lot of funds through such fraudulent activities.

4.1.4.1 The Committee recommends that since the terminal benefits are not adequate to cover the stolen funds, the Accounting Officer should by 31stJuly, 2017report the matter to the Police to ensure that the culprit is brought to book.        

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