Big Saturday Read:last dance before sunset – how Zimbabwe’s political elites loot the state
This is a long story, which begins with potholes as sites for rent-seeking and ends with the stark reality of a shadow state that has developed in Zimbabwe, manned by greedy political elites who seem to hold an unlimited licence to loot. This BSR sets out the problem, outlines the law and describes the options which citizens have to help enforce the law against corruption.
Rents for potholes
When you drive along the potholed streets of Harare, as you leave the crowded central business district towards the affluent northern suburbs, there is a good chance you will encounter a group of young men, probably three or four, at a make-shift “work-site”. There, they will be holding rudimentary implements, making themselves look busy. There might be a card-board sign a few metres before you reach their “work-site” upon which the words ’Slow Down‘ were inscribed by someone in a hurry and without care for the arrangement, size or consistency of the letters. The improvised sign will be wedged between two small rocks or broken bricks, probably with an accompanying broken branch or red-flag for added visibility.
There will be one chap in the middle of the road, appearing to be hard at work filling up a pothole with broken pieces of bricks and sand. There will be a mound of broken bricks, rocks and soil by the side of the road, more evidence to passing motorists that there is serious work in progress. As you slow down − in part, obeying the warning, and partly trying to negotiate your way around the obstacle − seeing an opportunity, another chap approaches the car, looking pitiful and pleading for a ‘donation’ in appreciation of their noble initiative to fix the road. They present themselves as benevolent volunteers who are working for the public good.
To the unfamiliar eye this is a moving gesture of good citizenship and one is compelled to search the pocket or dashboard in order to leave a small donation – a return gesture of appreciation. How can you not donate when you see otherwise unemployed young men doing something useful for the community, especially where the formal authorities have long since abandoned their mandate as evidenced by the epidemic of potholes on the streets?
But the more familiar eye has become wiser to these acts. They will simply smile, wave and pass through. They have seen it all before. They paid too until they caught up with the trick.
The boys might smile too, ruing a lost opportunity, but hoping there will be a catch soon enough. It’s like modern-day fishing, only this time, it’s on the roads. You lay the trap and hope the fish will come. Sometimes they do, but sometimes, they don’t. The young men occupy the usual point of the road for a period, then move to another. They claim to be volunteers fixing roads in the absence of the formal authorities. However, what appears to be a noble service is, in fact, an income-generating venture.
What the young men are doing is classic rent-seeking behaviour: the “donations” they demand motorists are the rents they earn. The ‘worksite’ they have set up is no more than a place of work from which they extract rents from motorists. To sustain the rent-seeking initiative, they might even empty the potholes overnight and start refilling them the next day. The cycle continues, generating daily rental under the guise of fixing potholes.
In fact, looking at the bigger picture, the young men are a taxing authority, levying charges on motorists. They have no legal authority to charge those rents, but that does not deter them. The authorities might stop them occasionally, but there is little appetite and few resources to follow them around.
This seemingly minor scenario is a microcosm of the rent-seeking behaviour and corruption within the state and society at large in Zimbabwe. It demonstrates how some people have created a shadow state alongside the formal system where they create their own rent-seeking opportunities. There, they extract rents which accumulate as they build their own parallel economy. We shall see in this article real examples of classic rent-seeking behaviour on a bigger and grander scale than the small, informal ‘states’ run by desperate young men on the suburban streets of Harare. The participants in this parallel state are the political elites, who include government Ministers and senior public officials. Their rent-seeking behaviour and its debilitating effects is the subject of today’s article.
Chogugudza, the public prosecutor
Chogugudza was a public prosecutor practising his trade at Rotten Row Magistrates Court in Harare. On 18 August 1992, two Zambian nationals, Emmanuel Malunga and Patrick Kanyemba, appeared before a magistrate. They were accused of car theft. They had been apprehended a few weeks earlier and were remanded in custody. On this court appearance, Chogugudza was their prosecutor. When the two suspects applied for bail through their lawyer, Chogugudza strenuously opposed it. Even an offer of title deeds as security by a relative of the suspects was rejected by Chogugudza. The magistrate delivered judgment two days later, agreeing with Chogugudza and refused to give bail to the suspects. So they remained in custody. But surprisingly, their fortunes were soon to change.
On 3 September 1992, the two suspects appeared again for yet another routine remand hearing. On this occasion, acting unilaterally and without consulting any of his superiors as the rules required, and without any application from the suspects, Chogugudza told the court that he was consenting to bail for the suspects. This was a swift and surprising turnaround given Chogugudza’s strong opposition to bail barely a fortnight before.
Unbeknown to Chogugudza, the suspects’ lawyer, who had been instructed to prepare an appeal against the earlier decision, was ploughing on. When Chogugudza had a surprising change of mind and consented to bail on 3 September, he did not inform the suspects’ lawyer, who remained unaware that his clients had since been granted bail. Chogugudza’s explanation of what had happened was unsatisfactory.
Soon after this, Chogugudza left the state’s employment and joined a law firm in private practice. On 2 November 1992, Chogugudza appeared again in court, but this time as the defence lawyer for the two suspects. They were now out of custody, thanks to Chogugudza’s consent to bail two months earlier when he was still a public prosecutor. This time, he was applying for a relaxation of the terms of bail which the suspects had been granted. The suspects were also remanded to 4 January 1993. However, when that day arrived, they did not appear in court. They had absconded. Kanyemba fled successfully, but Malunga’s luck ran out at Victoria Falls, where he was apprehended while trying to smuggle yet another stolen car into Zambia.
Afterwards, Chogugudza was arrested and charged with contravening the Prevention of Corruption Act [Chapter 9:16] in that he had acted contrary to his duty as a public officer for the purpose of showing favour to the two suspects. He was sentenced to 15 months’ imprisonment, of which 8 months were suspended on certain conditions. His appeal reached the Supreme Court, where it was rejected. In its judgment, the Court found there was a strong probability that Chogugudza must have been induced by a gift or other consideration to act as he did.
Chogugudza went on the serve his sentence for corruption, joining a line of other offenders who had been previously convicted of the same offence. As the Court stated, Chogugudza had unlawfully exploited his office for personal gain. As a public officer, he had shown favour to the suspects and had failed to explain why he had not done so unless it was for personal gain. He had switched his roles from being the prosecutor in the suspects’ case to being their defence lawyer in the same case, all within a short space of time. Chogugudza was corrupt and he paid his debt to the state.
Now compare Chogugudza’s case to the following case. I have covered it before in these pages, but it is worth repeating in this article http://alexmagaisa.com/tomanas-trail-nhereras-incredible-escape/
Tomana and Nherera
Charles Nherera, a university professor and former Vice Chancellor of Chinhoyi University of Technology, was the board chairman of ZUPCO, the state-owned passenger transport business. In 2007, he was convicted of corruption and sentenced to a term of imprisonment. One of his defence witnesses was Johannes Tomana, who was a fellow board member at ZUPCO. Clearly a man of favoured station, Tomana was also a Commissioner at the Anti-Corruption Commission, the body charged with the mandate to fight corruption in Zimbabwe. Despite holding this position, Tomana stood in court as a defence witness for Nherera, a man accused of corruption. It was all in vain, however, as Nherera was convicted of corruption and sent to prison, becoming one of the most high-profile victims of anti-corruption legislation.
However, Nherera's fortunes were soon to change, at least in so far as his criminal record was concerned, since he had already served his term. This change of fortune came sometime in 2008, when his defence witness became the Attorney General of Zimbabwe. During that year, the position of Attorney-General became vacant when the incumbent, Sobusa Gula-Ndebele, was sacked. It was then that Tomana was appointed to that position. Nherera was appealing against his conviction and sentence. Tomana, in his new post as Attorney-General, handled the matter and decided not to oppose Nherera’s appeal.
The decision was shocking because this was the state effectively giving up a conviction which it had pain-stakingly worked to secure. And now, the state was conceding so easily, without a fight. It was odd and suspicious. The only thing that had changed between the conviction and consent to the appeal was that the Attorney-General had changed. And it so happened that the person who was now the Attorney-General and who consented to the appeal had also been a key defence witness for the appellant at the trial. Surely, this was more than a coincidence. If anything, the scenario raised suspicion of favouritism by the Attorney General towards Nherera. Indeed, a judge raised concerns over the manner in which the Attorney-General handled the Nherera case. But nothing happened thereafter.
The Chogugudza and Nherera matters are classic cases of conflicts of interest by a public official. Both Chogugudza and Tomana were public officials who put themselves in situations which exposed them to conflicts of interest between their official duties and their interests or the interests of other persons. This raised the risk that they would prioritise their own interests or the interests of persons connected to them, ahead of the interests of the state which their public roles command them to serve. Chogugudza was duly prosecuted and convicted of corruption. It is hard to see how Tomana’s case is different from Chogugudza’s.After serving as Nherera’s defence witness, Tomana should never have got anywhere near the Nherera appeal after he assumed the role of Attorney-General because he was clearly conflicted. Poor Chogugudza was convicted and served his jail term. By contrast, Tomana went on to become the country’s Prosecutor-General, the man in charge of all prosecutions in the country and a position that he still holds to date.
I have started with those two cases because they encapsulate a number of issues at stake when it comes to corruption in Zimbabwe:
There are laws to prosecute corrupt public officers, which debunks the myth that Zimbabwe does not have anti-corruption laws or a definition of corruption. Chogugudza’s case is just one of a number of other convictions under that legislation.
While these laws are used against minor public officials, they are rarely, if at all, deployed against senior public officials. One major exception is the former boss of the Zimbabwe Anti-Corruption Commission, who was convicted of corruption last year.
The issue of conflicts of interest is at the heart of corruption – both in terms of the substantive aspects of the offences and in respect of the failure of the law enforcement machinery
The human factor plays a critical role in the fight against corruption: it is not the legal framework that is lacking, but the absence of a positive human factor and the challenge of weak institutions that lack independence and resources to execute their mandate. There is also the problem of a weak civil society in dealing with issues of corruption.
However, before I get into the legal analysis of how the scourge of corruption can be challenged, an illustrative account of conflicts of interest and favouritism which potentially breach the Constitution and the Prevention of Corruption Act is necessary. Here, I intend to demonstrate how these cases are perfect candidates for legal action under the Constitution as well as the Prevention of Corruption Act. They also demonstrate the rampant rent-seeking behaviour of Ministers and senior public officials.
Ignatius Chombo and the Harare City Council
Ignatius Chombo is the Minister of Home Affairs, which places him in charge of the police service. Prior to his appointment, Chombo was the Minister of Local Government, which oversees local authorities. In 2012, he went through a messy divorce with his then wife, Marian Chombo. The divorce case revealed that Chombo had amassed an incredible number of properties. He allegedly owned 75 residential and commercial stands, 14 houses and five flats across the country.
Allegations that he had used his advantageous position as a public officer to acquire this vast property portfolio in local authorities were corroborated by findings of an investigation carried out by the Harare City Council in 2010. The committee was set up to investigate council’s land deals and it reported how Chombo had misused his influence to acquire land in the city. A good example was a stand in Helensvale, a prime residential location in northern Harare. Back in the 1990s, this particular stand, Stand 61, had been ring-fenced against allocation for residential purposes and was declared a natural reserve area. It could not be sold or transferred to any person for residential purposes.
Nevertheless, between 2004 and 2006, up to six applicants had tried to persuade council but they all failed as council stuck to its resolution that the land was not for residential or commercial purposes. However, on 13 December 2006, Chombo wrote to council Town Clerk, Tendai Mahachi. In that letter, Chombo expressed his interest in buying Stand 61. The Director in charge of Urban Planning advised Chombo that he would help him acquire the stand and he duly recommended to the Commission running the affairs of Harare at the time that the stand could be sold to Chombo without going to tender, as required by council policy. At this point, I must mention that Harare was being run by a Commission whose members were appointed by Chombo after he had fired the elected council.
The property was sold to Chombo on 25 March 2008. The change of land use application to allow it to be used for residential purposes was made three days after Chombo bought the property. This application was made to Chombo, who was the Minister of Local Government. In other words, he was asked to approve an application in which he was the most interested party, a classic case of conflict of interest. The result was not only predictable, but obvious.
The investigation found several other irregularities in land acquisitions by Chombo.
Businessman Philip Chiyangwa was also implicated in the land scandals. The running theme was that city properties would be bought at very low prices and even against land use rules. The councillors found that, sometimes, stands were sold off to politically-connected persons who were not on the waiting list for residential stands. “All the stands were sold to people who were not on the housing waiting list through directives from the Minister. This was against the standing council policies and regulations,” said the report.
The councillors who had carried out the investigations were arrested and fired by Chombo. Chiyangwa reported Mayor Muchadeyi Masunda and councillors to the police for criminal defamation. They were arrested but the charges were later dropped. The Harare City Council reported Chombo and Chiyangwa’s alleged corruption to the police. However, nothing happened to the two men. Chombo is now Home Affairs Minister, and Chiyangwa is the chairman of the national football association.
Psychology Maziwisa is ZANU PF MP for the Highfield West constituency. He and Oscar Pambuka, a former newscaster, own a PR company called Fruitful Communications. This company was engaged to do PR work for ZESA, the energy parastatal which falls under the Ministry of Energy, headed by Minister Samuel Undenge. The Herald newspaper reported in May 2016 that Undenge had written a directive to ZESA and its subsidiaries, instructing them to engage the services of Fruitful Communications. “They [Fruitful Communications] have done publicity work for the Ministry of Energy and Power Development by putting me as the principal voice at the forefront of explaining our vision as well as the different interventions that are currently being undertaken by the ministry,” wrote Undenge to ZESA. He added: “I have found them to be incredibly useful in this regard and hereby direct that you work as closely as possible with them at intervals of six months per engagement until 2018.”
ZESA and its subsidiaries were not amused by this ministerial interference, particularly as they already had their own fully-staffed PR departments. They did not see the need to comply with a directive to engage an external PR company.
When the murky deal was exposed, Undenge tried to wriggle out, but his effort was clumsy and poor. “They are people in public relations and there is no formal contract with anyone and if anyone wants to help for free, we allow them,” he explained to The Herald newspaper, suggesting that Fruitful Communications was working for free. “They felt they wanted to explain something to the public. It’s just like you. You write a lot of things but we do not pay you,” he added.
Maziwisa’s response was no better. Contrary to Undenge’s claim that they were working for free, there was evidence that Fruitful Communications had already been receiving payments from the parastatals and they were demanding further payment for services allegedly performed. The Herald reported that any further payments had been stopped after a directive by the ZESA boss. Undenge was evasive and tried to shift responsibility but it was clear he had facilitated the Fruitful Communications deal and that tender procedures had not been followed.
Intratrek irregular advance
Wicknell Chivhayo is a large, garrulous man who revels in flaunting his lavish possessions and extravagant lifestyle, including vast amounts of cash and shopping trips to Dubai, New York and other glamorous destinations. He revels in sharing intimate details of his lifestyle, including First Class air-tickets and dinners with the First Lady, Grace Mugabe, and her children. He commands a large and avid following on social media, which appears to enjoy the antics. He does not miss a photo opportunity with the politically powerful, a trait which probably serves him well in business as the images suggest proximity to power. A stint in prison for a fraud conviction has clearly not been a handicap in his business adventures.
In between these displays of extravagance and arrogance, Chivhayo has bouts of extraordinary generosity. For example, he has been sponsoring the skint national football team, which has endeared him to many fans. When 200 Zimbabwean women were stranded in Kuwait after they were promised jobs only to discover that they had been sold into slavery, Chivhayo rescued some of them as the broke government struggled to bring them back home. A maverick is one word to describe him: admired by his fans and abhorred by others. But random acts of generosity, which include offering a social media comedian ZAR100,000 simply because he likes his acts, soften the otherwise harder edges shaped by pride and arrogance. How he earned his wealth has been a subject of interest and debate among Zimbabweans. For his part, Chivhayo declares that he is simply a smart businessman, and he probably is.
One area that he has cornered is the market for large-scale government tenders. He owns a company called Intratrek. While the company lacks knowledge, expertise or experience, it thrives on Chivhayo’s ability to form and build relationships with wealthier,better-placed and more knowledgeable foreign partners. He is a classic example of the intermediary, the petit bourgeoisie middlemen of an under-developed post-colonial middle class so eloquently described by Franz Fanon in his 1960s classic, The Wretched of the Earth.
In this case, Intratrek won a tender to build a multi-million dollar 100MW solar power plant in Gwanda. It is one of several power contracts awarded to Intratrek by the government. Energy Minister Samuel Undenge crops up again by virtue of his portfolio’s mandate. The law requires that any advance that is paid to a contractor must be secured by a performance bond. This performance bond is designed to protect public funds in case the contractor fails to perform. However, Intratrek was paid an advance of US$5 million by the Zimbabwe Power Company (ZPC), the energy infrastructure subsidiary of power utility Zesa Holdings, even though Intratrek did not provide the performance bond. This was a breach of the rules and unlawful.
Undenge admitted that rules had been broken. “It is true that each time public funds are advanced to service providers, there is a risk that the goods or service, as the case may be, may not be delivered. To mitigate against this risk, it is as a standard requirement that a bank guarantee is secured against possible failure to deliver. Such an inevitable requirement should have been considered in the case of a US$5m advance payment to Intratrek by the ZPC,” Undenge said.
However, Undenge did not take responsibility for what had happened. Instead, he chose to downplay it by saying: “…it is highly improbable or unlikely that there will be any real prejudice to the ZPC in respect of this particular advance. Thus, in this ministry’s assessment, whereas the risk was there, in reality, there will be no financial prejudice and this in no way exonerates those who erred.”
Undenge does not seem to appreciate that the issue is not whether or not there was financial prejudice to the state, but whether he and other public officers adhered to or breached the rules. He does not appreciate that the issue is whether or not there might have been favouritism extended to Intratrek in giving them an unsecured advance contrary to the rules, a move that might be regarded as a breach of the Prevention of Corruption Act. As we saw in the Chogugudza case above, the mere fact that the public prosecutor had shown favour to the suspects and had failed to satisfactorily explain this favour resulted in him being found guilty of breaching the Prevention of Corruption Act.
Is there a prosecutable case under the Prevention of Corruption Act in this case? Based on the facts, the legislation and on precedent, there is a strong case against Undenge and other public officers involved in paying the unsecured advance.
Supa Mandiwanzira is one of the young generation ZANU PF politicians. He started his professional life as a journalist, working as a reporter, then a newsreader at the ZBC TV, the country’s sole national television station. He was also the correspondent for SABC and Al Jazeera. His talents in the field are undoubted. He rose in business and is the beneficial owner of ZiFM, one of the country’s first two private radio stations. Then afterwards, a political career beckoned. He won a ticket into Parliament in the 2013 elections and was appointed Deputy Minister for Information and Publicity. This appointment immediately presented a conflict of interest given his position as the beneficial owner of ZiFM. It meant he was in supervising entities that were competing against his own. But this was not his fault. It was the responsibility of the appointing authority, who should have known that the situation presented a conflict of interest and was contrary to the letter and spirit of section 106(2) of the Constitution. It’s like appointing Strive Masiyiwa, Econet’s founder and owner, to regulate mobile telephone companies.
Anyway, in a subsequent reshuffle, Mugabe promoted Mandiwanzira to Minister of ICT. There, he sits in charge of the regulation of mobile telecommunications companies, through the Postal and Telecommunications Regulatory Authority of Zimbabwe (PORTRAZ), the regulatory authority. He recently engineered the takeover by government of a large stake in Telecel, one of the mobile phone operators to add to NetOne, which the state already owns. Both businesses have been outshone by their rival Econet for many years. The deal involving the takeover of Telecel is interesting and poses a number of issues around its funding, but I will skip it for purposes of this piece. More pertinent are revelations that Mandiwanzira and his deputy, Win Mlambo, were granted “loans” worth $194,000 and $95,000 respectively, from POTRAZ. Apparently the purpose of the loans was to purchase cars for the two Ministers. The ICT Ministry also got a $58,888 loan from PORTRAZ and NetOne. There are a number of problems with these loans as follows:
First, according to the Auditor-General, who made the revelations, these loans were not approved by the national treasury and had not been paid back at the time of the audit’s conclusion. There is no indication of what the interest rates were, if any, or the terms of the loans, and whether in fact POTRAZ has legal authority to issue loans to Ministers or anyone, for that matter. According to the Auditor General: “The ministry did not provide documentary evidence to show that they were given Treasury authority to borrow from state owned enterprises. Since the amount of $58 888 relates to appropriation expenses by the ministry, the expenditure should be accounted for in the 2015 financial year.” Which means these financial transactions involving public funds broke the rules. All persons involved, including the Ministers, are public officers and there subject to Chapter 9 of the Constitution and the indication form the Auditor General is that they breached the rules.
Second, since Mandiwanzira and his deputy supervise POTRAZ, they are in a position of influence, which raises questions as to whether they used undue influence on the parastatal to obtain the loans. If it were a corporate organisation, these would be insider loans and since the Auditor-General says there were no repayments, they would qualify as non-performing insider loans – one of the reasons why many indigenous banks have collapsed. On what legal authority did POTRAZ advance car loans to Ministers?
Third, there is a conflict of interest when the Minister who supervises a parastatal obtains a loan from the same institution. This parastatal is supposed to account to him, and yet he is involved in transactions that are plainly breaking the rules. How does he hold PORTRAZ accountable when he is party to the rule breach?
Fourth, in addition to Chapter 9, Mandiwanzira and Mlambo are also accountable under section 106(2) of the Constitution, which prohibits conflicts of interest and benefiting personally from state property, but more on this later in this article.
But the case also exposes their sheer greed and profligacy: as Ministers, both men would have already received new vehicles from government when they were appointed, yet they went on to use their positions to acquire new vehicles through a ‘loan’ from a parastatal under their charge. It’s scandalous and shows that the Ministers are doing as they please because there is no supervision or control from the leadership.It is unlikely that Mandiwanzira’s case is an isolated one. Further audits could reveal that Ministers generally tend to get cars and such ‘loans’ from parastatals under their charge, which they are absolutely not entitled to.
Zhuwao and Triple Bottom Line
Thandi Ngwenya is the director of a company called Triple Bottom Line, or 3BL. She told a Parliamentary Portfolio Committee on Youth and Indigenisation that her firm was engaged by the Ministry of Youth, Empowerment and Indigenisation to provide consultancy services to the ministry. Ngwenya was known to Patrick Zhuwao, the Minister in charge of the Ministry, who is also a nephew of President Mugabe.
“After President (Robert) Mugabe appointed honourable Patrick Zhuwao as minister, 3BL approached the ministry with a proposal to host and jointly manage events and projects on its behalf on a profit-sharing arrangement,” she is reported to have told the committee.
It emerged that Zhuwao had directed Ministry staff to work with Ngwenya and her company. When the Ministry’s Permanent Secretary, Mr Magosvongwe, appeared before the parliamentary committee, he said Zhuwao had instructed the Ministry to engage 3BL in respect of events management.
“We were introduced to 3BL by our minister [Zhuwao]. He summoned us to his office and introduced Thandi Ngwenya [3BL chief executive officer] to us. She is the only person we were introduced to. He said she wanted to work with the ministry and he asked us to look at the modalities of how it would be done,” Magosvongwe told the committee.
Nevertheless, this relationship failed to take root because of an adverse report from the Attorney-General’s Office which rejected a draft memorandum of understanding that had been presented to the Ministry by 3BL. The Attorney-General’s Office correctly held that the deal needed to be handled through the public tender system.
The Permanent Secretary also stated that when the Ministry’s Finance Director, Emmanuel Ngwarati, approached him claiming that 3BL was demanding payment for the ‘exploratory work’ it had allegedly done, he had refused to make payment.
This case, like the Fruitful Communications’ deal, did not go to tender. There are strong indications of favour being advanced to 3BL by the Minister, a public official. Is it a prosecutable offence? Like the cases cited so far, there are strong indications of a breach of the Prevention of Corruption Act. The Chogugudza precedent shows that one can be prosecuted for far less. Once a favour is shown to have been advanced, as the Minister did in the 3BL case, the onus shifts to Minister to give a rational explanation for why that favour was granted.
The professor and diamond companies
Professor Francis Gudyanga, a former academic at the University of Zimbabwe, is the Permanent Secretary for Mines and Mining Development. This Ministry is in charge of the lucrative diamond industry, which promised so much a decade ago when diamonds were discovered in Chiadzwa, but has delivered very little to the national coffers. At some point, the then Minister in charge of mining, Obert Mpofu, declared that Zimbabwe had so many diamonds that it would never have to beg again. Earlier this year, during his birthday interview in February, President Mugabe disclosed to an astonished nation that the country had lost diamond revenues to the tune of US$15 billion.
Around that time, government announced that it was withdrawing all licences to diamond mining companies and consolidating the business under one government entity, the Zimbabwe Consolidated Mining Company (ZCMC). Government would have 50% of the business and the ZCMC would have the other half. However, some of the companies sued government and the matter is yet to be finalised. Government proceeded to form the ZCMC anyway but as the Parliamentary Committee on Mines and Mining Development found out at a recent hearing, ZCMC is improperly set up and the board is improperly constituted. First, the ZCMC is registered as a private company under the Companies Act and not incorporated under an Act of Parliament as it should be so that Parliament has direct oversight. Second, the improper constitution of the board means its decisions may be invalid. Third, the fact that the board is inadequate also poses grave risks of corporate governance.
However, the biggest problem is the conflicts of interest arising from Professor Gudyanga’s position. He chairs the ZCDC and two other entities under the Ministry. Apart from the ZCMC, he also chairs the Mineral Exploration and Marketing Company and the Zimbabwe School of Mines. This is highly improper because he is chairing boards that are supposed to account to him. In effect, Professor is accounting to himself, which is farcical as good corporate governance demands independent boards that exercise due diligence and are accountable to a third party. As we shall soon see, this runs contrary to the constitutional rules governing the conduct of public officials.
His conduct is also a breach of the code on corporate governance which prohibits permanent secretaries from sitting on boards of entities under their supervision. As Permanent Secretary, Prof Gudyanga is the chief accounting officer at the Ministry and the boards should be accounting to him. At present, however, he is a dubious situation in which he accounts to himself. Worse, The Herald newspaper also reported on 14 June that Gudyanga had “some links with a Dubai based firm, which is the largest buyer of Zimbabwe’s diamonds”. This also raises the risk of conflicts of interest, given his role at the Ministry. He has also been involved in the hiring and firing of senior staff, with allegations that he may have used his position to influence the recruitment and dismissal of certain senior employees.
David Parirenyatwa and PSMAS
David Parirenyatwa is Zimbabwe’s Minister of Health. As a qualified doctor, he is also involved in a health services business, a situation which immediately raises conflicts of interest. The PSMAS is a medical aid society which was set up originally to cater for civil servants health insurance but has since broadened its services. It works like any other medical insurance service: a member pays contributions periodically, and if he or covered their members of the family fall ill, they can access medical services and PSMAS will make the relevant payments to the health services provider. However, PSMAS has been struggling to meet its commitments. Two years ago, it emerged that its top executives were literally pillaging it through excessive wages, allowances and other benefits. The Chief Executive Officer, Cuthbert Dube, was reportedly taking at least half a million dollars each month. Board members, who included senior public servants such as Permanent Secretary for Information and Publicity and presidential spokesperson, George Charamba, were also receiving huge fees and allowances by PSMAS.
Last year, it emerged that David Parirenyatwa had been paid an amount of money by PSMAS for unpaid services. It was said to be $100,000 and far more than was due to him. The Minister did not dispute this over-payment. Instead, he tried to explain it as ‘capitation’, which he said was a normal practice in the insurance industry. It was strange though, because hundreds of his fellow doctors in private practice were complaining that they had not been paid by PSMAS for long periods of time. There were also other creditors who were struggling to get payment from PSMAS. Why and how then did it have enough resources to pay excess money to Parirenyatwa in advance for services that he had not even rendered? This raised serious concerns that Parirenyatwa had abused his public office, especially as he has influence over PSMAS, where senior executive appointments had been made under his watch.
Is this a prosecutable case? There certainly appears to be a case of favouritism in that Parirenyatwa got excessive payments that he did not deserve from a company over which he had leverage at a time when that company was struggling to meet its obligations to his peers in the medical profession. It seems there is a good case for prosecution under the Prevention of Corruption Act.
I could cite more cases, including the Dema Diesel Power Plant where a company that never submitted to the tender process still got the tender anyway, and it so happens that an in-law of President Mugabe is part of the entity which got the tender. But that would add to this already lengthy article. I must move on now to the legal analysis.
Conflicts of interest
All the cases that I have cited and narrated have one common thread: conflicts of interest. The public officers who were involved in all these cases placed themselves in situations that exposed them to such conflicts. Conflicts of interest arise where the personal interests of a public officer clash with the interests of their office or, more generally, the entity or organisation that they serve. The rationale behind the prohibition of conflicts of interest is that the public officer will invariably prioritise his personal interests over those of the public office, entity or state which they serve. In other words, if left unchecked, conflicts of interest create a moral hazard whereby a public officer will tend to abuse their public office for personal gain at the expense of the entity or state which they are obliged to serve. A wide range of activities and roles that would place a public officer in a conflict of interest are covered by legal prohibitions.
Conflicts can occur in any number of ways and situations: it could be a public officer using state property for personal gain. For example: when a public officer uses a state vehicle to carry passengers and charge them a fee, which he pockets. It might be a public officer who uses state trucks to ferry produce from his farm to the market. It could also be a situation where a public officer who collects rents on behalf of the state decides, instead, to extract bribes in place of state rents. A common state rent is the duties that ZIMRA charges on imports. These rents are collected on behalf of the state and go into the national coffers. However, a ZIMRA officer might offer an importer an opportunity to pay less or no duty at all in return for a personal bribe. The bribe that the ZIMRA officer earns is his rent but it prejudices the state, which receives reduced rents or nothing at all. In that case, the ZIMRA officer has a conflict of interest and he would have prioritised his interests ahead of the state’s interests. As most Zimbabweans know, this is an all too common practice at Zimbabwe’s borders and ports of entry.
Another common rent-seeking scenario is the police road-block. Police officers who stop cars and issue tickets for any infringements do so on behalf of the state. The penalties they charge are rents that should go into the state coffers. However, as most people know, police officers often solicit or accept bribes from motorists at these road-blocks. These bribes are personal rents that the police officers earn only because of the public office they occupy and its power, which they abuse. The state loses the rents it would have received. What’s more, unroadworthy vehicles and unsafe drivers are permitted to use the streets because of the police officers’ personal rent-seeking actions. Not only does this lead to lawlessness, but roads become unsafe and the risk of accidents increases. All because, when faced with a conflict of interest, the police officers chose to prioritise their own interests ahead of the state and society’s at large. Looking at the bigger picture, the fact is that conflicts of interest and the corruption they fuel have huge social costs for society.
The key principle is that a public officer must not place himself in a situation that exposes him to conflicts of interest.
Conflicts of interest and the Constitution
When the new Constitution was being written, efforts were made to establish a general framework and principles to prevent or, at least, minimise conflicts of interest by prohibiting certain conduct. I’m familiar and partial to these rules because I had a very keen interest in ensuring that they were included in the Constitution. I knew corruption was a big issue. Outreach reports had shown that most people were also concerned about corruption and they were calling for the Constitution to deal with the problem. However, the data was unclear on actual ways in which people wanted corruption to be stopped. They just wanted the Constitution to stop it.
Of course, we knew that the Constitution alone could not meet their aspiration to stop corruption, but we understood this was the layperson’s instruction to establish anti-corruption mechanisms. One of these mechanisms, the anti-corruption commission, already existed under the old Constitution, but it needed to be strengthened.
Before joining the advisory team to COPAC, the parliamentary committee that led the constitution-making process, I had been teaching company law for some years. I had a strong interest in the area of directors’ duties and the relationship between directors, shareholders and their company. While directors wielded a large amount of power over the company, there was a risk that they would prioritise their own interests at the expense of the company’s and, consequently, the shareholders’ interests. The law of directors’ duties was designed to address this conflict by holding directors more accountable to the company and its investors. One of the key rules in this area is the No Conflicts Rule, which also includes the No Profit Rule. They essentially mean that directors must not allow their personal interest to clash with the interests of the company and that a director must not earn secret profits using their position in the company. They cannot also use information that they obtains in respect of the affairs of the company to make personal gain. Indeed, a director must not compete with the company or take opportunities that could be taken by the company. These are strict rules, but directors can absolve themselves from their grip if they are honest and transparent and, therefore, disclose their personal interests where there is potential for conflict.
When we were framing the Constitution, I thought these broad principles and rules on conflicts of interest could be borrowed and adapted to draw up rules governing the conduct of public officers in relation to the state. A public officer could be treated in relation to the state in the same way as a director is to the company. The Constitution defines a ‘public officer’ as ‘a person holding or acting in a public office’ and a ‘public office’ is ‘a paid office in the service of the state’. This is a broad definition that covers every person who serves the state in a paid capacity, from the most junior civil servant to the President. The idea is to ensure that every public officer is held to account and is not exposed to a situation where a conflict of interest arises, because that is likely to fuel corruption.
It was against this background that a proposition was made for what now appears in section 106 and sections 196(2) of Zimbabwe’s Constitution. The initial proposition was more detailed than the current provisions, but they were later shortened in drafting. He idea was that the Constitution would only set out the general principles and the detailed rules would be left to the implementing legislation.
Section 196(2), which applies to all public officers, states as follows:
“Public officers must conduct themselves, in public and private life, so as to avoid any conflict between their personal interests and their public or official duties, and to abstain from any conduct that demeans their office”.
The meaning of this constitutional provisions is clear: all public officers, no matter how small or mighty, must avoid conflicts of interest and any conduct that negatively affects the office they hold. There can be no doubt that the No Conflicts Rule is now a key constitutional principle where public officers are concerned. It is important, however, to give substance and elaboration to this rule and, hopefully, this will be covered through legislation.
For Ministers and Vice Presidents, there are additional and more specific rules in terms of section 106 of the Constitution, which states as follows:
“2. Vice-Presidents, Ministers and Deputy Ministers may not, during their tenure of office —
directly or indirectly, hold any other public office or undertake any other paid work;
act in any way that is inconsistent with their office, or expose themselves to any situation involving the risk of a conflict between their official responsibilities and private interests; or
use their position, or any information entrusted to them, to enrich themselves or improperly benefit any other person.”
Subsection 3 provides that there must be a code of conduct for Vice-Presidents, Ministers and Deputy Ministers through an Act of Parliament. There is no good reason why this provision does not also include the President. In fact, the initial proposition covered Minister, including the President. I am not sure why this was later limited to exclude the President. Nevertheless, the broader provision covering conflicts in respect of public officers under s. 196(2) covers the President.
However, section 106(2) is critical for the enforcement of the No Conflicts Rule. In the case of Parirenyatwa, if his payment from PSMAS was for paid work that he had undertaken, there is an arguable case that he was in breach of the provision, which does not permit Ministers to undertake any other paid work. This does not mean a Minister cannot run a business. They can, but this must be declared and running a business is not the same as taking up employment. These provisions also make it clear that Ministers must not expose themselves to situations where their interests conflict with those of the state. They should not use their position or information to enrich themselves or improperly benefit any other person. Undenge appears to have infringed all these provisions both in the Intratrek and Fruitful Communications case. As for Mandiwanzira and his deputy, Mlambo, who got car loans from a parastatal under their charge, they seem to have violated both sections 106(2)(b) and (c.) by acting in a way that is inconsistent with their office and exposes them to a situation involving the risk of a conflict between their official responsibilities and private interests. They may also have used their position to enrich themselves.
The Zimbabwe Anti-Corruption Commission
At the centre of the country’s anti-corruption architecture lies the Zimbabwe Anti-Corruption Commission (ZACC), which has the constitutional mandate to combat corruption. It is one of the two Chapter 13 institutions specifically mandated ‘to combat crime and corruption’. The other is the National Prosecuting Authority.
Many Zimbabweans who have watched with much admiration the work of South Africa’s Public Protector, Thuli Madonsela, have often lamented the fact that Zimbabwe does not have a similar institution. It is true that Zimbabwe does not have a Public Protector, but if a comparison must be made, it is worth noting that South Africa does not have a constitutional body like the ZACC. Their Constitutional Court has interpreted their Constitution as requiring the establishment of an independent anti-corruption unit. ZACC has the powers and mandate to execute some functions of a Public Protector. That our ZACC has not had the same level of success as the SA Public Protector is largely due to ZACC’s institutional weaknesses and the human factor. By the human factor, I mean the character, integrity and independence of persons who perform the roles, either as the Public Protector in SA or as Commissioners of the ZACC. While the SA Public Protector has shown herself to be an individual of high integrity who is fiercely independent and stands in principle, the majority of the ZACC Commissioners in Zimbabwe have shown themselves to be weak, compromised and also corrupt.
Besides, government and political interference in the work of the ZACC and financial suffocation have reduced ZACC’s institutional independence. But corruption is the most insidious challenge to the ZACC. A recent report in The Herald newspaper showed that sometime in 2008, the ZACC Commissioners corruptly received luxury properties in upmarket areas − from the ZACC. The former CEO of the ZACC is presently in jail after being convicted of corruption. In another clear case of conflict of interest, he made secret profits from a transaction involving a ZACC property. Four senior managers of the ZACC were also recently suspended on allegations of corruption. As a result, the irony is that the same body which is constitutionally mandated to combat corruption in Zimbabwe is institutionally corrupt.
As for political interference: when the ZACC tried to investigate corruption in the mining industry in 2013, some of the Commissioners were promptly arrested by the State. When ZACC recently tried to undertake some investigations, the presidential spokesperson, George Charamba, issued a rebuke, arguing that they were acting in haste. Critics interpreted this as political interference, given the role which Charamba occupies in government and the fact that his involvement in the PSMAS saga makes him a potential target for ZACC investigations. In addition, recent reports suggesting that the ZACC is now ‘housed’ in the Office of the President and Cabinet raise a lot of questions over its institutional independence. The OPC is not immune from corruption. If anything, as the highest office in the land, it needs to be kept in check by institutions such as the ZACC. It’s like the Public Protector in SA being moved into the President Zuma office, a subject of the Public Protector’s investigations. It does not make sense because it creates the conflicts of interest that the institution is supposed to steer clear from and to investigate where they appear.
The ZACC’s legal powers
Otherwise ZACC does have important constitutional powers, such as the power to investigate and expose cases of corruption in the public and private sectors. This means the ZACC has investigatory powers and does not have to rely on the police. However, it can call upon and rely on the police service to assist in investigations.
More significantly, the ZACC has the power to direct the Commissioner-General of Police to investigate cases of corruption and the Commissioner-General is legally obliged to follow those instructions. There are two critical constitutional provisions which make this position clear:
First, section 255(1)(e.) states that the ZACC has the power “to direct the Commissioner-General of Police to investigate cases of suspected corruption and to report to the Commission on the results of any such investigation”. Second, section 255(2) provides that: “The Commissioner-General of Police must comply with any directive given to him or her by the Zimbabwe Anti-Corruption Commission under subsection (1)(e)”.
The effect of these two provisions is that in addition to its own investigatory powers, the ZACC has the power to order the Police Commissioner-General, Augustine Chihuri, to carry out investigations and he would have to comply. This is an important power. However, to my knowledge it has not been used. If the ZACC has been spurned by Chihuri, it has not said so. This was a contentious provision during the constitution-making process as some thought it would compromise the independence of the Commissioner-General of the Police. However, it was agreed that it was more important to ensure that ZACC had more power and that its directives were not ignored by the Commissioner-General.
It is also important to note that under section 255(1) (d) the ZACC has the function “to receive and consider complaints from the public and to take such action in regard to the complaints as it considers appropriate”. The purpose of this provision is actually to provide a facility for members of the public to make complaints to the ZACC about issues and to demand an investigation. The provision is designed to ensure that the ZACC does not simply ignore the complaints but it must “consider” the complaints and take what it “considers to be appropriate action”. However, while this constitutional path is clear, there is no evidence that it has been used. All the cases that have been discussed in this article and elsewhere are proper candidates for public complaints that can and must be placed before the ZACC. What the ZACC does with those complaints is a test of its independence and integrity. But there is no reason why members of the public, NGOs etc. should not make use of this constitutional mechanism in the fight against corruption.
The National Prosecuting Authority
The National Prosecuting Authority (NPA) is another institution that has an important role to play in combating corruption. Like the ZACC, there are provisions for its independence. Similarly, however, it suffers from the human factor element and lack of resources. As I write, the NPA faces eviction from its premises because it is in arrears with its rent. However, its great weakness lies in the human factor. While the Public Protector in SA is spearheading action against corrupt public officials, the Prosecutor-General in Zimbabwe is implicated in corrupt activities. The Nherera case, described at the beginning of this article, is one case in point. Here, there are clear conflicts of interest that warrant investigation. Then there is the case of the ZACC luxury residential properties corruptly given to Commissioners in 2008. The current Prosecutor-General was one of the recipients of those properties. In both cases, there is a clear conflict of interest as the Prosecutor-General is not going to prosecute himself or authorise his own prosecution. However, section 255(1)(f) gives power to the ZACC “to refer matters to the National Prosecuting Authority for prosecution”. Thus it is up to ZACC to carry out investigations even where the Prosecutor-General is involved. The NPA will have to act upon that referral once it is made.
The Auditor-General’s Office
There are probably on a few Zimbabweans who have ever head of the Auditor-General’s Office. This is a constitutional office whose mandate is to carry out audits on all state entities, including government itself. The Auditor-General is a diligent woman called Mildred Chiri. She and her team are unsung heroes who have been churning out reports year after year, demonstrating irregularities and corrupt practices, but receiving no attention from her client, the government. It’s only in recent years that some members of the public have begun to highlight her work. If South Africa has Thuli Madonsela, performing admirable work with great bravery and determination, across the Limpopo, there is Mildred Chiri, although her profile is more understated. She does not command the same headlines, but those who have followed her work respect her and her team of government auditors. The weakness is that the client does not care and, therefore, her efforts have so far been in vain. Yet, as a record of irregularities and looting, the Auditor- General’s reports will remain critical.
Why then, if the law on conflicts of interest and corruption is so clear, has nothing been done in any of the cases I have outlined?
The answer is that the entire system is crooked, if not completely broken. The bodies that are supposed to be at the forefront of fighting corruption are institutionally corrupt. The rent-seeking culture is now so deep-rooted in the public sector and society that it has become the norm rather than the exception. Besides, corruption is part of the system of patronage which sustains President Mugabe’s power. He has created a system which allows subordinates to loot, but this corruption is then used to politically blackmail them. Political elites become so utterly dependent on the looting machine that they would rather remain within the system than leave or challenge President Mugabe. President Mugabe presides over two states: the formal state, which is broke; and a shadow state, which operates parallel to the formal state and is sustained by corruption and the illegal rents that it yields. However, the rampant looting and ease with which the Ministers are conducting acts of corruption suggests that President Mugabe has lost command of the shadow state or at least that his subordinates no longer care that he is watching. Since they know he will not do anything, their rent-seeking behaviour has become more brazen and voracious.
The irony is that the shadow state − comprising a few political and military elites and connected individuals − is wealthy and cash-rich, while the formal state is broke and failing to meet its normal obligations. The shadow state feeds on the formal state structures; it is predatory and uses the formal state as a wealth-laundering scheme. This is evident in the deals and transactions described in this article. Public officers are busy extracting illegal rents from or on the back of the state for self-enrichment. No-one polices the shadow state and it flourishes. The trouble is those outside this shadow state aspire to positions in the formal state so that they can also start extracting rents from the shadow state. This evident in the conduct of new Ministers or MPs who only came in after the 2013 elections.
What can people do to help in the fight against corruption?
I have already pointed out one way, provided for in the Constitution, that any member of the public can use to submit a corruption complaint to the ZACC and oblige the ZACC to consider it for investigation. People can complain but if they do not use the facilities available under the Constitution, it won’t be helpful. Let the ZACC fail to act on complaints rather than do nothing when the facility to submit complaints exists and is available to be used. All the cases I have summarised here − Undenge, Parirenyatwa, Zhuwao etc. − can be submitted to the ZACC with a complaint for investigation.
Second, members of the public who have access to records of activities by public officers must keep these records. They will be useful in future when procedures for asset recovery are undertaken. ZANU PF’s control will not last forever and, just as Nigeria is pursuing looted assets from as far back as the Abacha regime, Zimbabwe will one day carry out its own asset recovery programme. That is when current data on who looted what or gained unfairly will become very useful.
Third, citizens must avoid being accessories to corruption. Each time a person pays a bribe to a public official, they are committing an act of corruption too. The culture of bribes at road-blocks is pervasive because people are prepared to pay bribes, even though the practice of exacting spot-fines has been declared illegal by the courts. Corruption will continue to thrive as long as people think it is the most convenient route. But as we have already observed, corruption has huge social and economic costs for society.
The fourth option is the so-called Mawarire application after the case that set an important precedent on citizens’ right to enforce the Constitution and duties of public officers. In the case of Jealousy Mawarire v President of Zimbabwe (2013), which I have previously analysed in these pages, the Constitutional Court set a very useful precedent that any citizen who believes that their constitutional rights are infringed by a public officer’s failure to uphold the Constitution and the rule of law can launch legal action to correct those breaches and infringements. Mawarire had argued that President Mugabe’s failure to set election dates as required by law violated the Constitution and the rule of law and breached his constitutional rights to protection of the law and his rights as a voter. In my view, the same approach can be taken in cases where there is reasonable suspicion of corruption, but the responsible bodies, such as the ZACC, the Police and the NPA, are failing to take the necessary action. The fact that they are independent bodies does not prevent citizens from calling for action where the bodies are deliberately or negligently failing to act in upholding their constitutional mandate.
Parliament: also has an important role to pay as the custodian of the Constitution. Section 119 provides that Parliament shall protect the Constitution. It also provides that all bodies, including commissions shall account to Parliament. There is no reason why Parliament cannot summon the ZACC, the NPA, the Commissioner-General of the Police and other relevant parties to account for their inaction in the face of various acts of corruption. Parliamentary portfolio committees which monitor various Ministries have been doing a good job in recent months. For the last two years, the Justice Mayor Wadyajena-chaired Youth, Indigenisation and Empowerment Committee has lead the way after it started probing dealings in the diamonds fields of Chiadzwa. The work of portfolio committees is important since naming and shaming can, in the long, run work as a form of checks and balances on the Executive. However, without more action, members of the Executive will end up with the impression that it’s a mere show with no consequence.
Therefore, the work of portfolio committees needs to be complemented by law enforcement agencies such as the ZACC, the police and the NPA. Reports and findings of portfolio committees which disclose prima facie evidence of corruption and impropriety should be handed over to the ZACC and police for further action. Using the Mawarire application, citizens and civil society groups should also raise complaints with the ZACC and police using revelations in the deliberations and reports of portfolio committees.
This article is already longer than it was intended to be. But there is so much material on corruption I could have gone on for a few more pages. I thought it was necessary to capture the most glaring cases that expose potentially corrupt conduct but where nothing has been done by law enforcement agencies, even though the laws to take action are available. I have also endeavoured to demonstrate that citizens are not without options. Instead of merely complaining when they see or read about corruption, there are routes they can take to ensure the relevant laws are enforced. I have shown how the new Constitution offers citizens a number of options. A key issue is to appreciate that corruption affects the enjoyment of all the fundamental rights and freedoms guaranteed under the Constitution. It is a threat to the rule of law. This means people and bodies with a duty to combat corruption must execute their mandates. And, if they fail or neglect to do so, any citizen should be able to approach the courts to declare that these people and bodies are in breach of the Constitution, and compel the courts to comply and take action. The Mawarire precedent is, therefore, of critical significance in these processes as it confirmed that access to the Constitutional Court to pursue such actions is broad and flexible.
There is a scorched earth quality to the manner in which political elites and senior public officials have behaved in recent months – looting everything and leaving nothing but bare ground as they retreat. There is, in their rampant acts of looting, betrayal of some fear among their number that the end is nigh and that they must therefore grab as much as they can in the shortest possible time before the sun sets. You get the sense they think these are the final days and if they do not steal and store their loot now, the opportunity may never come again. It is hardly surprising that the younger generation of ZANU PF political elites, the latecomers to this sordid orgy of post-colonial looting, are the most avid and rapacious rent-seekers. They have little time left so they display a voracious appetite for self-enrichment. It’s obscene and embarrassing in a land where most are living from hand to mouth. But there shall be a time for them to account.
President Mugabe will one day depart from the scene and leave a mixed legacy. Failure to deal decisively with corruption and allowing corruption by his Ministers and senior public officials will feature prominently on the balance sheet of his achievements and failures. But unlike the physical damage wrought on the country, the damage done by corruption will be much harder to undo. The true cost of corruption will be carried by future generations and they will look back and never forgive this generation of leaders and those of us who allowed them to do it.
With acknowledgements to The Source, The Herald, The Zimbabwe Independent, NewsDay, The Daily News and the Financial Gazette, all Zimbabwean newspapers on which I have heavily relied for the illustrative cases of corruption in Zimbabwe.