THE latest audit findings contained in the Auditor-General (AG)’s report have exposed the rot at the Zimbabwe National Road Administration (Zinara), where some board members exempted themselves from paying toll and vehicle licence fees without approval from the parent ministry.
In a 390-page report by the AG for state-owned enterprises and parastatals for the financial year ended December 31, 2022, the Zinara board acted contrary to the provisions of the Public Entities and Corporate Governance Act.
“The board authorised an exemption to its members from paying toll fees and vehicle licence fees for two personal vehicles per member without approval from the parent ministry,” reads the report.
“This was contrary to the provisions of the Public Entities and Corporate Governance Act (Chapter 10:31), Section 14, which requires other benefits to be approved by the responsible minister.”
In its response, the Zinara management defended the move, claiming that a resolution on exemptions was submitted to the Corporate Governance Unit and Transport ministry, as required by law.
“The observation is noted. A resolution to this extent was passed by the board to authorise and ratify this benefit to board members. The resolution on exemptions was submitted to the Corporate Governance Unit and the Ministry as required under the law,” the management noted.
“In line with the recommendation, a letter to seek approval of granting exemptions to board members has been submitted to the Minister of Transport and Infrastructural Development.
“In the meantime, the board of Zinara has interrogated this practice and resolved to revoke the granting of both vehicle licence and toll fee exemptions to board members, until feedback on the practice is received from the Minister.
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“The road administration should ensure that all benefits granted to board members are approved by the relevant authorities.” The report stated that there was no consensus on the administration’s subsidiary (Infralink) tax status between the tax authorities and the company’s directors.
“The tax authorities formally advised the Infralink that they were a tax-paying entity in 2015.
“However, the directors are not in agreement with this determination and have advised that engagements with regulators and tax authorities are ongoing which may result in Infralink being exempted from paying taxes.
“As a result, the group has not provided for any income taxes in respect of the current and the previous four financial years in the financial statements,” the report further states.
Zinara recently took a bold stance against fraud which culminated in the suspension of nine employees caught by security systems deployed at various tollgates. This comes after the organisation embarked on undercover surveillance which unearthed suspicious activities including system overrides at their sites.
In an internal communique from the risk and loss control unit to members of staff seen by this publication, the organisation advised that, through a mix of risk and loss control operations, the unit picked suspicious conduct from tolling sites, which include Eskbank Tollgate.
Zinara has over the past months been subject to criticism by local authorities over its disbursement policy.
However, Zinara maintained that local authorities must report to the government if they are unhappy with the way it was disbursing funding for road rehabilitation.
Zinara chief executive officer Nkosinathi Ncube told the Zimbabwe Independent recently that there were well-laid-out avenues for settling such disputes.
“We are on record saying if there are some road authorities that are not happy with the formula they can engage both the Ministry of Local Government and Ministry of Transport and Infrastructural Development,” Ncube said.
Zinara’s mandate is to fix, collect and disburse road user charges and mobilise revenue for road development and maintenance.
In Bulawayo, councillors have accused the government of being complicit in the continued deterioration of roads, saying nothing much was being done.
