No payments for black market charges: Govt US$18,45 per kg for beef, US$12 per kg for chicken
GOVERNMENT is finalising a public procurement audit to authenticate prices which were submitted by suppliers whose payments were withheld, a senior official has said.
Contrary to misconceptions that Treasury has withheld payment to all suppliers of goods and services, the suspension applies to only a third of providers accused of inflating prices, with authorities ready to resume disbursements once prices are adjusted.
Travel agencies, food and beverages providers, computer traders and players in the hospitality industry are among the blacklisted suppliers. In an interview with our Harare Bureau, Permanent Secretary for Finance and Economic Development, Mr George Guvamatanga said Government will continue withholding payments to suppliers charging exorbitant prices
“Government never stopped paying its contractors and suppliers, there is a misconception that Government has stopped paying for goods and services supplied. We are not only paying suppliers who are inflating their prices.
“These are suppliers who have been pegging their prices using the parallel markets rates and we will not be paying them until they adjust their prices. And these contractors make up only 30 percent of all the contractors that we normally pay. We are still compiling the amounts that we owe, however I can say that Government has the money to pay them,” he said.
Mr Guvamatanga said some suppliers were inflating prices by over four or five times the market value.
“In other countries, Government being the biggest buyer would be getting discounts but it is different here because suppliers inflate their prices. For example, a company wanted to supply printers to one of the Government Ministries for $1,4 million. The same printers are going for $400 000 in the market.
“Some were quoting a kg of economy beef for US$18,45 and a kg of chicken for US$12. Some in the hotel industry where quoting $168 000 a room and US$89 for breakfast alone. Travel agents were supplying tickets to Victoria Falls for US$769. What is important to note is most of these suppliers demanded their dues in local currency which would then convert to US dollars.”
He added that the fall of the local currency on the parallel market some months ago was caused by excess money created from exhorbitant prices charged by suppliers.
“We have closed the source that was being exploited by suppliers. There was artificial demand that was created by suppliers who were charging exorbitant prices to Government and taking the money to the parallel market. The reduction in demand will also be seen in supermarkets because there is no excess money in the economy. The reduced demand will also redress the pricing system in the economy,” said Mr Guvamatanga.
Last month, President Mnangagwa said accounting officers who fail to detect pricing malpractices would be deemed criminally negligent and held personally liable in terms of the Public Finance Management Act while suppliers who generate invoices based on black market exchange rates would be banned.
Asked whether the Zimbabwe AntCorruption Commission will initiate investigations on malpractices in public procurement, the anti-graft body’s spokesperson, Commissioner John Makamure said:
“I will have to check with the secretariat if they are working on such cases.”