Hoteliers under fire over pricing
THE government has vowed to set up new hospitality facilities and renovate existing ones to counter private players accused of ripping off the state through exorbitant pricing.
This follows Finance and Economic Development permanent secretary George Guvamatanga’s internal communication a fortnight ago where he questioned the pricing models by airlines and hospitality companies.
The Zimbabwe Independent is reliably informed that the government is crafting the requirements for the renovation of the Zipam conferencing facility in Darwendale.
A team of officials from the Treasury was dispatched to Nyanga last week on a factfinding mission to ascertain the financial demands of reviving hospitality facility Inn on Rupurara.
The facility has not been fully functional for years.
The latest move by the government means a number of public officials will be compelled to use state-owned hospitality facilities as a cost-cutting measure.
“Treasury is looking at various ways to cut costs; hospitality costs have been a major headache. There have been some engagements on prices between government and hotels but the latter has not been forthcoming. Therefore, the government is now looking at taking its business elsewhere. That will culminate in the renovation of the Zipam facility in Darwendale as well as the upgrade of Inn on Rupurara in Nyanga,” a source close to the developments told the Independent.
The government move is expected to have ramifications on the revenues of various hotels considering the amount of conferencing business the state gives to hospitality facilities.
The impact of the absence of government business on hotels was felt during the Covid-19 pandemic period where restrictive measures saw various government conferences put on hold.
Guvamatanga could not be reached for comment as his mobile phone went unanswered.
Hospitality Association of Zimbabwe (HAZ) first vice president Brian Nyakutombwa said there was a need for engagement to address concerns raised by both parties.
“We have heard something to that effect through a circular from the Ministry of Finance but there has not been any engagement through the association. We believe there is still room for engagement and finding each other but as it is, the move looks reactive. There is a need for a holistic approach to address issues being raised. The government and the hospitality industry both have huge roles to play,” Nyakutombwa said.
The latest move comes after the government blocked multi-billion dollar supply deals accused of fuelling currency volatilities, which have weakened the Zimbabwean dollar in recent months.
This follows indications that a number of suppliers have been milking the government by indexing prices on foreign currency parallel market rates as high as US$1:ZW$1 500.
The government recently busted a syndicate comprising vehicle suppliers and senior procurement officials in various state institutions which has been prejudicing the state of millions of United States dollars through inflated supply deals.
The Independent is reliably informed that some motor vehicle suppliers have been scamming the government, taking advantage of the Procurement Regulatory Authority of Zimbabwe’s decentralised system to invoice government departments different prices on the same product.
According to the new procurement law all ministries, state-owned enterprises and local authorities are supposed to establish Procurement Management Units (PMUs).
The units are expected to be manned by professional procurement officers, who are licenced in terms of the Public Procurement and Disposal of Public Assets Act [Chapter 22:23].
The PMUs are responsible for the procurement cycle in the public sector from planning, adoption of the appropriate method of procurement, preparing bid notices and shortlisting, managing the bids and evaluation processes, preparing evaluation reports to awarding of contracts and overseeing management and preparing procurement reports.
This, according to well-placed sources at Treasury, has seen motor vehicle suppliers abusing government systems through invoicing different prices despite delivering the same product with same specifications to state departments.
The Independent is informed that the Treasury has since raised a red flag on this potential prejudice and communicated to various government departments to undertake due diligence on vehicle procurement.