ZESA Holdings executive chairman Sidney Gata is under fire over a bizarre internal memo effectively instructing the company’s Managing Director to enter into a copper harvesting contract with cable manufacturer CAFCA allegedly without going to tender.
In a letter dated 5 November 2020, seen by Nehanda Radio, Gata wrote: “On the 4 November, 2020 I held a meeting with CAFCA management in which the same informed me that they are agreeable to funding materials, labour and transport requirements for the copper harvesting programme.
“I am aware that the levels of copper conductor and cable thefts are rising to alarming levels. The need to accelerate implementation of this programme cannot, therefore be over emphasized.
“In view of the aforementioned, I am kindly requesting you to speedily implement the copper harvesting programme utilising the funding which has been availed by CAFCA.”
Under the deal CAFCA is meant to pay invoices for the materials, pay contract workers recruited by ZETDC and then recover their money from the proceeds of the recovered copper purchases.
Gata then bizarrely ends the letter by saying; “please be reminded that you must comply fully with the following requirements when carrying out this assignment. * All ZESA and ZETDC procedures and processes. *The Public Procurement and Disposal of Assets Act (Chapter 22;23).”
A source who spoke to Nehanda Radio said by having a meeting with CAFCA to discuss the contract, Gata had already violated procedures that clearly state such deals have to go to tender.
In an exclusive interview with Nehanda Radio Gata however denied the claims saying this was “nonsense”, “You yourself have quoted me as insisting that ZESA, ZEDTC and PRAZ processes and procedures are to be observed. So where is problem?”
Told “even as you state that procedures must be followed, you have already had a meeting with CAFCA, thats were the concerns are coming from? Procurement is the process of selecting a company and the perception from the letter is that you have already selected CAFCA,” Gata hit back;
“You really must be desperate !! I am allowed to meet anyone at all. The meeting CLEARLY STATED that due process and procedure must be followed. Where is your concern really?” Gata said.
However a ZESA source who spoke to Nehanda Radio claimed Gata had “already assigned someone in the western region (Bulawayo) who is leading in copper harvesting a sure sign the selection was being done without following tender procedures.”
Gata was asked if there was a tender advert which Caffca had won? His response was that Nehanda Radio was “being used by bogus copper dealers whose licenses will not be renewed.”
“From our experience, it is clear that you are being commissioned by copper dealers, some of who are CRIMINALS, who are well accustomed to obtaining their copper from a very theft and vandalism of public infrastructure which has caused mayhem to services such as hospitals, airports and other sensitive centers.
“If these people now want to fight back through media, that is game, because we shall also decimate them through the same media and yourself through defamation. We already have the list of copper dealers whose licenses WILL NOT be renewed from January 2121.
“We shall publish the list of these criminals, in order for the public to know who has been stealing their copper and how certain media is collaborating. Be our guest,” Gata claimed.
Pressed on why he was not addressing the meeting with CAFFCA before a tender process that selects the winning company, Gata said;
“For the avoidance of doubt, I can meet with any one, any time, and anywhere, as I desire. I have just checked with my Executive Office Assistant who sends the following text:
“The café Zetdc copper barter deal is an arrangement which was approved by PRAZ two or more years ago. ZETDC was allowed to sell scrap copper to CAFCA because the organisation was recycling the copper to make conductor unlike other dealers who were exporting the scrap.
“Cafca is the only organisation with this capability and hence was given the order since copper conductor was susceptible to theft. Cafca supplies aluminum conductor as replacement for copper.
There exists a detailed contract in place between Zetdc and Cafca governing this arrangement. l hope this text sheds light on this subject. I hope the above explanation will suffice to end your anxiety on the CAFCA copper agreement.
“I take the opportunity to re-assure you that 2021 should see the end of theft and vandalism of public infrastructure. I hope your article will come out to help condemn theft and vandalism of public assets,” Gata added in his response.
Contacted for comment Energy and Power Development Minister Soda Zhemu told Nehanda Radio “I know nothing about that internal memo. Can you send a copy.”
In November 2018 the Competition and Tariff Commission (CTC) condemned the barter agreement between the Zimbabwe Electricity Transmission and Distribution Company (ZETDC) and electrical cable supplier CAFCA accusing the two of engaging in restrictive trade practices.
“It was alleged that ZETDC and CAFCA have a barter agreement whereby CAFCA is supplying aluminium conductor cables to ZETDC in exchange for copper scrap from ZETDC in a manner that excluded other players in the relevant market.”
The CTC said it requested the Procurement Regulatory Authority of Zimbabwe (PRAZ) to withdraw the authority granted to CAFCA and ZETDC for the barter agreement. The commission further recommended that ZETDC flight open tenders for aluminium conductor cables.
As ZESA Holding executive chairman, Gata wields huge influence over multi-million-dollar infrastructure tenders and supply contracts at Zesa. He was locked in a bruising boardroom battle with the then Energy Minister Fortune Chasi who decided to fire him in August 2020.
Gata was reinstated in September 2020 with President Emmerson Mnangagwa eventually wielding the axe on Minister Chasi. Mnangagwa said while the investigations were on-going, Gata must be allowed to carry on with his responsibilities as ZESA boss.
In a July 30 letter to Chasi, Gata said he was “deeply involved in uprooting disturbing serious levels of corruption in the company.” The parastatal has been rocked by one corruption scandal after another with several ZESA executives sacked and arrested or redeployed in recent months.