By Bernard Chiketo
MUTARE – Crocked senior council employees are operating syndicates that are siphoning millions of dollars from the cash-strapped council, in one of the most elaborate schemes to emerge from the municipality, which is struggling to provide basic services to its residents.
The Eastern News can exclusively report that there exists a well-choreographed corruption ring in council that is funnelling revenue through their private companies, which are supplying goods and services to the municipality at inflated prices, and getting first priority for payment.
Indications are that the local authority, which is not new to controversy, has suffered heavy financial losses, which could have contributed to its failure to pay salaries on time.
Council’s failure to pay its employees has largely been blamed on the $30 million-plus debtors’ book it is owed by defaulting ratepayers.
The municipality employs over 1 000 workers, who take up more than 75 percent of council revenue in wages and salaries.
Mutare Town Clerk Joshua Maligwa confirmed the development this week, saying council bled heavily due to the shady dealings.
“I can confirm (that). There was no way council could ever have been able to honour its obligations to its employees with such an intricate web of shady deals,” he said.
Maligwa, who signs for all the purchases, said he was now probing the suppliers’ list to see if any of his employees had a beneficial interest in the companies.
“I’ve since put measures in place to critically analyse orders and have a well-checked suppliers’ list,” he added.
It is unlikely that council would be able to crack the puzzle unless it pierces through the corporate veil of the companies involved.
Most corrupt officials hardly appear on the directors’ list of companies in which they have an interest. They normally hide their interests through fronts and convoluted ownership structures that cannot be pinned down to individuals, unless forensic auditors are brought in.
Investigations by the Eastern News found that most of the corrupt senior council employees operate small-to-medium sized companies through fronts.
Interestingly, these are hardly owed any money by the local authority, a fact confirmed by Maligwa.
“I can confirm that most of our debts are to our employees and big, well-established companies like Zesa . . . not to most of the smaller companies that we work with.”
Sources say all companies that had been providing services to council are now under probe after some of them were identified as having links to senior council employees.
An invoice seen by this paper of four rebounded brake shoes, which cost just $100 in some of the shops in the eastern border city had actually been inflated to $320 by one of the companies currently being investigated by council.
To hide their shenanigans, the council employees would rotate companies they buy from among their pool of companies.
Occasionally, they would also source quotations from the established companies so that they could be viewed as impartial.
More often than not, the quotations sourced from the big companies would not be considered for being expensive, thus justifying sourcing from their smaller companies which supply inferior products.
Council has lost millions of dollars from the murky deals and a thorough forensic audit may be required to establish the extent of the prejudice.
Some of the smaller companies offer services and products in excess of $5 000 weekly, which is paid with minimal delay.
This trend has placed council’s procurement and accounts departments under scrutiny.
Maligwa could not be drawn into disclosing more details, saying the issue was still under investigation.
“We would not want to prejudice the investigations by having all the details discussed in the media,” he said.
He, however, revealed that he had been going through dossiers of audit reports, which he instituted, to fully understand every department in the council.
“I’ve been in this job for three months and I’m still trying to fully appreciate what has been happening,” Maligwa said.
Council has been up in arms with government over mismanagement of the city’s affairs.
Local Government minister Saviour Kasukuwere has been on a warpath with councils that are failing to deliver basic services to their residents and yet their officials are living in the lap of luxury.
The City of Mutare is located right on the border between Zimbabwe and Mozambique.
Mutare is Zimbabwe’s closest city to the sea, making it the most strategic location for transport costs sensitive import and export oriented enterprises.
For this reason in particular, Mutare has been considered as Zimbabwe’s gateway to the Indian Ocean.
Mutare is the capital of Manicaland Province and covers an area of approximately 16 700 hectares.
It is situated 263 kilometres east of Harare and 290 kilometres west of the Port of Beira, Mozambique. Daily News