Public Accounts Committee Report Exposes Treasury ‘Negligence’
The Ministry of Finance and Economic Development has been rapped for gross negligence and non-compliance to some of its obligations, raising concern over the competence of the Accountant-General, Daniel Muchemwa, the Public Accounts Committee’s first report on compliance issues for the ministry has revealed.
The Committee, chaired by Harare East legislator, Tendai Biti outlined a number of non-compliance issues the ministry and its various organs failed to execute as prescribed by the Constitution.
According to the committee, the Accountant-General has failed to keep pace with monthly financial statements, has not prepared consolidated quarterly statements for a long time and did not withhold remaining funds from Ministries that could have been dissolved.
Treasury was also found wanting for failing to seek approval from Parliament for various borrowings it undertook contrary to the Constitution.
“The Committee noted that the total amount for domestic and foreign debt of $ 17,69 billion as at August 2018 reported in the 2019 Budget Statement was different from $ 9, 2 billion reflected in the 2019 Budget Estimates. The Committee also noted that some external debts were improperly classified as domestic debt. Examples include China Nanchang Engineering, China Interl Water and Electricity and RBZ-/ZISCO/DUTCH, Mota Engil & HCCL Creditors and PTA Bank among others. It was further noted that all the loans obtained/debts incurred should have been presented to Parliament for approval as these were acquired outside the budget,” read the report.
Section 33(3) of the Public Finance and Management Act prescribes, the Accountant-General to prepare consolidated quarterly financial statements and submit them to the Secretary for presentation by the Minister to the National Assembly and to the appropriate Parliamentary Portfolio Committee, within sixty days of the end of the respective quarter.
However, Accountant-General has again failed to produce his quarterly financial statement for 2019 despite assuring the Committee he will do so earlier in the year.
Apparently the Accountant-General is still seized with monthly statements for the month of December 2018, a 6 month lag.
The Committee has however ordered the Accountant General to submit consolidated quarterly financial statements for first and second quarter 2019 by the 31st of August 2019 with recommendation for appropriate disciplinary action against the Accountant General within 60 days of the tabling of this report.
Analysts have warned that the gross negligence exuded in high offices could spell negative effects to the fiscus, tantamount to those attributable to corruption if left unchecked.
Government has been on a debt contraction spree in recent year without Parliamentary approval as monetary authorities were reluctant to conform to the law.
“The Committee’s finding was that Government had been non-compliant with section 11(2) of the Public Debt Management Act by exceeding the borrowing limit of 70% to GDP, before rebasing of the Gross Domestic Product figures,” the report further stated.