THE Central Mechanical Engineering Department (CMED) yesterday warned that it might fail to provide adequate vehicles to the Zimbabwe Electoral Commission (Zec) in the forthcoming harmonised elections if government fails to settle its debts.
CMED managing director Davison Mhaka told the Parliamentary Portfolio Committee on Transport and Infrastructural Development, chaired by Kwekwe Central MP Blessing Chebundo, that Treasury owed them $1,6 million for vehicles hired by Zec during the constitutional referendum in March and $800 000 from fuel drawn by government departments.
“We have had a situation where we hired out 3 000 vehicles to Zec recently with an addition of what we got after sub-contracting to the public to get the required vehicles for the referendum, but unfortunately we were not paid for the services in full to the extent we ended up paying the contracted individuals from CMED coffers,” Mhaka said.
“The main challenge is that we have not been able to collect all the money from Treasury and we are owed $800 000 from the fuel drawn from CMED and that has affected trade. For 2013, we earmarked close to 100 pick-up trucks in anticipation of elections, but at the moment we only managed to secure 20 vehicles mainly because of the challenges in the environment like the liquidity crunch in government and the private sector.
“It will be tough to negotiate with Zec to ensure the $1,6 million they owe us is paid before elections.”
He said some of the challenges that CMED was facing were fuel stockouts.
MPs from the committee said the stockouts were affecting them immensely as the fuel coupons they were entitled to ended up expiring and they were required to travel to Harare to have them renewed as no other town was allowed to renew them.
“The reasons why coupons expire is that we wanted to manage criminal activities where people printed their own coupons. To solve the issue of stockouts, we have applied for a fuel import licence and have placed an order for fuel, but it has not been delivered yet,” Mhaka said.
He said CMED had other business activities like Easy Go, which has driving schools and bus routes to South Africa and Zambia. The company made a $6 million profit in 2010, $3 million in 2011 and $1,3 million dividends declared on profits in 2011.
However, Mhaka said the money was on paper, not cash in the bank.