Looting Zimbabwe

It is hard to believe that in a poor African country where most people survive on less than one US$1 per day, the top executives of some of parastatals are grossing half a million US dollars – per month!

Author

P Dube

February 10th, 2014

It is hard to believe that in a poor African country where most people survive on less than one US$1 per day, the top executives of some of parastatals are grossing half a million US dollars – per month!

This is happening in Zimbabwean parastatals and state enterprises at a time when the country's economy is on its knees and most people are battling to scrape a living. What makes it even worse are that some of these institutions have failed to pay their ordinary workers for much of the past year, claiming that their coffers are empty and that they were making massive losses due to the economic meltdown.

But now the truth is out – and it is barely believable. Zimbabweans have heard a lot about corruption over the past decade but the scale of the latest revelations – involving parastatals like the Zimbabwe Broadcasting Corporation (ZBC), Air Zimbabwe, and Marange Resources as well as the state-funded Premier Service Medical Aid Society (PSMAS) – have left most ordinary people shell-shocked.

After a number of exposes in the local media, it was clear that there was a massive and systematic looting of public funds at these state institutions through mega-salaries, outrageous allowances and misappropriation of resources by top management.

Take PSMAS, for example. This state-funded scheme, which was created to assist civil servants and poor people, was paying its Chief Executive Officer, Cuthbert Dube, US$500,000 each month. It is a truly ‘obscene’ amount in any country, let alone one as bankrupt as Zimbabwe. For comparison, the most powerful man on earth, US President Barack Obama, takes home US$400,000 – per year! And Dube was not the only one earning more than Obama. The CEO of the ZBC, Happison Muchechetere, was raking in a monthly salary of US$40,000 – a figure that was boosted with several other, sizeable allowances.

This has left many Zimbabweans shaking heads in disbelief. And wondering how these institutions’ Board members could have given the green light to such exorbitant salaries, particularly when their lower-level workers were wallowing in poverty without pay for months on end. More than 1,000 ZBC workers countrywide were destitute and desperate – having not been paid for eight months because the broadcaster’s management claimed that the organisation was bankrupt. Meanwhile, thousands of lowly paid government workers were contributing monthly subscriptions to the PSMAS medical aid scheme. However, the Dube-led administration has messed up operations so completely that it has built up an unpayable debt of US$38 million, which has left the organisation incapable of honouring its obligations to its members.

An audit carried out on the state-owned Marange Resources Diamond Company also revealed that the nation’s coffers lost millions of dollars as management raised inflated procurement receipts and pocketed the difference. While at Zimbabwe's state-run national airline, Air Zimbabwe, top management were implicated in a 5.2 million Euro aviation insurance scandal.

Just days before President Mugabe’s 90th birthday and less than a year since ZANU-PF triumphed in patently flawed elections, this corruption scandal could not have come at a worse time. Unsurprisingly, the government – which must have been aware of most of this beforehand – moved swiftly to suspend Dube, Muchechetere and other top managers. But the damage has been done. The media exposes and public calls by the labour unions, civil society groups, human rights organisations, economists and opposition parties for the arrest and prosecution of all the corrupt executives has left the authorities flailing. Because everyone knows that the blame really lies in the hands of those responsible for overseeing the institutions – namely government ministers, senior bureaucrats and the ZANU-PF super majority in parliament.

"There was clearly no political commitment to perform any oversight of these parastatals by the line ministers, permanent secretaries or parliament since the salaries and perks of executives were approved by the entire boards,” said Loughty Dube chairperson of the Zimbabwe chapter of global anti-corruption network Transparency International (TI). “These parastatals were used by those in the government to feed from and loot without being seen by the public."

"The levels of corruption and maladministration in public service (parastatals) are unbearable. Millions and millions of innocent patriotic citizens are unemployed and live in serious poverty while a few CEOs who support Mugabe's ZANU-PF party are looting taxpayers' money,” said Clifford Hlatyawayo, Youth Assembly spokesperson of the opposition MDC-T. “They must be arrested now and brought before the courts."

But this scandal is far from unique. Before these revelations came out, Zimbabwe was already regarded as one of the most corrupt nations on the continent.

In December last year, TI in its Corruption Perception Index (CPI) ranked Zimbabwe at number 157 out of 177 countries – rendering it the most corrupt nation in SADC in terms of the perceived levels of corruption in the public sector, which takes some doing. Meanwhile, last November, Zimbabwe picked up the accolade of the third most corrupt country in Africa – after Nigeria and Egypt – according to the Afrobarometer research report. The report added that corruption in Zimbabwe had increased by 43 percent between 2002 and 2012.

Zimbabwe has a history of seeing its state enterprises looted until they are reduced to little more than shells, like the case of Ziscosteel in Kwekwe. Parliamentary investigations recently proved that the company had been systematically looted by executives, who were conniving with senior government officials.

Mugabe's ZANU-PF officials have long – and successfully – blamed western-imposed sanctions for the demise of state enterprises, but it is now clear that looting at these institutions, which the authorities turned a blind eye to, contributed more than anything to their collapse. These revelations show that the West’s targeted sanctions are just being used as scapegoats – as a convenient cover for chief executives and others to loot state resources. This scandal has also destroyed the naïve belief of many that ZANU-PF would change its spots after its convincing – and SADC/AU endorsed – victory in last year’s elections.

This is a leopard that has fed for years off the national coffers and is clearly continuing to do so.

I am one of many Zimbabweans who were completely against the scrapping of western-imposed sanctions – arguing that they were targeted at individuals and were a way of punishing human rights violators. But now I have changed my mind. It is time to scrap the sanctions because those they were intended to punish are still in office and because they allow people to loot our resources with impunity, blaming the sanctions for all the problems.

It is time to scrap the sanctions and leave the looters without even a scrap of foreign interference to hide behind.

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