PMRC executive director Bernadette Deka struggled to defend weak accountability systems in the country at an Oasis Forum-organised public discussion, Wednesday evening.
And economist Trevor Simumba says with government’s uncontrolled borrowing, the private sector will soon be crowded out of the economy.
Meanwhile, NAREP president Elias Chipimo has urged heads of investigative and law enforcement agencies to emulate Financial Intelligence Centre Director General Mary Tshuma’s bravery.
Simumba was first up to share his views on accountability in Zambia and his presentation centred on heavy debt contraction.
“This government has been borrowing heavily in the last three to four years, our total external debt as of March 2018 is $9.1 billion. This is information from official statistics and I agree with our former Finance Minister Alexander Chikwanda who was saying that by the end of 2018 our total external debt will reach $13 billion because of the pipeline debt, that debt which we have already contracted but is not yet disbursed. In this last quarter, the government spent 43% of their money on paying debts and guess how much they used on Social Cash Transfer? 15.4%. So we are already spending more to pay back debt than we are spending on providing social services. Government also spent 22.7% on personal emoluments, salaries for workers. So in the first quarter of 2018, the government is running a fiscal deficit of 20.6% and yet the government has continued to borrow and spend,” Simumba said.
“Now one of the biggest issue with increased government borrowing is that it crowds out the private sector, it means that we are starving the economy of resources that should be going to you and me to start new businesses, to expand business and if you look at the performance of the economy, apart from the mining sector, the rest of the sectors are struggling, they are contracting debt. Including the construction sector because the construction sector is dominated by Chinese firms and most of that money is going out the country, there is very little staying in the economy. So it’s posing a very big challenge to the economy. And just look at the amount of money we are spending on external debt servicing, from March 2017 to February 2018, government spent $552 million just on servicing external debt. If you add domestic debt, government spent over $600 million on interest payment, so in one-year government is already spending over a billion dollars just servicing debt.”
And Chipimo urged heads of heads of investigative and law enforcement agencies to emulate Financial Intelligence Centre Director General Mary Tshuma’s bravery.
“I have even gone as far as suggesting that the same way that we traditional marriage ceremonies, let’s also have something for corruption. We can say tulekumana pakubosha (we are gathering against corruption). The narrative now is not the question of ‘why is this person stealing?’ the narrative is ‘why is this person stealing everything?’ That is unacceptable in a society that sees for itself a progressive kind of future. We have very weak institutions in this country and those institutions are weak because they are led by weak individuals. We don’t even need to change the law, if you had a Laura Miti heading the Anti-Corruption Commission, if you had a Trevor Simumba heading the Drug Enforcement Commission… it’s the spirit that this individual would bring, the spirit of fearlessness is simply good for the job,” Chipimo said.
“I am calling on the Director Generals of these organisations to emulate the work of Mary Tshuma and what her organisation has done. It is about time we stood up for things that are right, it’s about time we stood up for this nation and to do that, we need a change of mind-set. We need to change the at we look at things, we have to challenge the leaders within the churches and the Christian community to say what are you eating at your congregation? What example are you setting, how much emphasis are you placing on morality? Because the moral call of our society has been completely eroded and it will be a mistake for us to simply point the fingers at President [Edgar] Lungu and think that the problem begins at his back. This is about change of our attitude and the sooner we begin to realise that we need to have an interest at individual level, the better it will be. We can set up an individual body that is not answerable to the President but answerable to the people and that body should have the right to ensure that each agency is able to enforce the law.”
Chipimo noted that the fight against corruption was everyone’s responsibility.
“The only thing necessary for evil to prevail in the world is for good men and women to do nothing and that’s why if I had my way, I would ask of us to stand up and give a round of applause to Mary Tshuma for the work that she has done. This is what is supposed to happen and it is something that we are supposed to discuss and debate in detail to get to the bottom of what has gone wrong in our society. They have estimated that $450 million has gone into corrupt activities, money laundering, tax evasion. That is close to being an equivalent to debt service that we are required to pay this year alone. You see the connection between these two statistics? And what has now happened? We are now forcing the Central Bank to gather as much capital as they can because they are trying to find the best way of protecting the reserves which are now under debt. There is no money for social infrastructure other than through the procurement of loans from the Chinese. Here is how it works, because Zambia has become an extension of China, the loan is provided for infrastructure development and no Zambian can compete because we don’t have the capacity to provide the necessary guarantees to access those loans because the performance is dependent on whether you can guarantee that you can actually deliver. So we are not in an alliance from the very beginning. Loans are structured in such a way that will not enter our systems. So it goes to Exim Bank of China,” Chipimo said.
Chipimo said it was unfortunate that often times, parliamentarians left ordinary citizens to demand for accountability from government.
“The problem is in the fiscal indiscipline that has been evident in this country for the last 20 to 15 years. It started off very small and it’s growing by the day. So what is the way forward? We need much more effective oversights, Parliament should play it’s role. I have appealed to the Parliamentarians to do their job. This is the reason why they were elected. We cannot sit back and hope that somehow the problem will go away. The constitution sets out the provisions under which debt should be procured in this county and there is a process that should involve the parliamentarians. But that is not being done,” lamented Chipimo.
“Secondly, we need to change our procurement laws. Right now, we can procure something in the name of the nation and pay the highest price for the lowest value. Our laws on procurement need to fundamentally change, there is a finding in the FIC report which suggests that an addendum on a specific procurement for utility vehicles was made available to the winning bidder and not to the other bidder. Why has this thing not been taken up by Parliament? We rely on the general public to be the ones to rise up and make noise about these issues. This is unacceptable, corruption is actually now very much part of our culture and the sooner we wake up to that reality, the better the chances for future generations who are going to pick up the bills for them mistake that we are making today.”
Meanwhile, when called to the podium to give her presentation, Deka urged her fellow discussants and Zambians at large to desist from pointing fingers at government officials when accountability problems were also evident in people’s homes.
“The issue of accountability begins with each one of us, it begins in our homes, it begins in our churches managing church resources, it begins even in CSOs. There are civil society organisations and NGOs managing resources very well on behalf of the people and on behalf of the funders that give us those funds. So it also goes with our home attitude or it could be in a bank where you pay a K10 so that you can jump the queue, that’s public accountability. It also goes to someone paying money to a University Professor so that they can give you a degree that you don’t deserve. In our homes, to our wives, our farmers and our children, how we account for the money that obviously is supposed to fend our families. So what the president of NAREP said is very cardinal, public accountability begins with me. We cannot be pointing fingers at an individual who came maybe two years or a year ago and heap the problems on that one individual,” Deka said.
“So now I am going into the technical bit to quickly highlight the main issues that were cited in the Auditor General’s report in the last seven years from 2009 to 2016 which is the latest, even that needs to change because the latest should at least be 2017. So the publicness of public accountability relates to at least two different features, public relates to the openness and how the accounting is done in public. Secondly, the word public refers to the public sector. On the appropriation of Funds, from 2009 there was rise and then between 2010 to 2013, we saw a decline. 2014 and 2015, there was minimal misapplication of funds and in 2016 a very high rise again due to one individual who actually stole so much money from government about over K3.5 million, just one person named Mr Bwalya if you remember.”
Deka attributed the lack of public accountability in the public sector to inadequate laws and systems.
“There have been challenges of poor supervision and oversight on public resources due to inadequate laws and systems, that’s on how to handle cases of financial misconduct and dealing with public assets and public stores management. We have also noted as PMRC in our mandate to complement government efforts with public reforms, we have been noting that there has been unreliable electronic systems that lead to poor service and accountability. For example, the e-voucher system where government had challenges in offering Farmers Input on time in different areas of the country. So I think it’s important that people deal with facts and not personal thinking and personal opinions,” Deka said.
“If the procurement systems are strengthened, government can save a lot of money and also curb exhaustive recipients of monies. Government officials and other people, actually these are lower government officials that we are talking about who are in the majority, our brothers and sisters before we can even talk about up there. It is about those in the lower levels that are actually doing these funny things and costing us in our society. So PMRC continues to advocate for review of internal controls of audit committees.”
When the moderator advised Deka to wind up as she had exhausted her time, the PRMC executive director protested; shouting, “no no no, the general public deserves to know the truth! We are basing our arguments on evidence based on the work done by PMRC,” before the microphone was withdrawn from her.
Meanwhile, Transparency International Zambia (TIZ) executive director Wesley Chibamba observed that corruption had continued to thrive because government was only giving a lip service to the fight against the vice.
“The FIC tells you that there is something wrong, there is no way we can be losing K3.5 billion through tax evasion. The amount of money attached to corruption is too much and then people want to attack the FIC and say they didn’t give this information to the law enforcement agencies. But when you look at the report, the first part talks about dissemination where they talked told us that they disseminated this information through law enforcement agencies. So let us not shoot the messenger, we need to interrogate the contents of the report and arrest the situation. We need to stop paying a lip service to the fight corruption, leaders need to be held to account,” said Chibamba.
And CTPD executive director Isaac Mwaipopo observed that there were low levels of accountability in Zambia.
“We were asked to answer the question of whether there is accountability in Zambia and after long deliberations we found out that there is actually low levels of accountability in our country. One example that I can share with the public is around the setting up of toll gates, we are aware that in the many roads that we pass through as a country, we come across a number of toll gates, a brilliant initiative that we have actually been in support of. But one of the challenges that we’ve noted over the years is that from the time this initiative was set up, it has brought a basic question that from the time this initiative as set up, how much have we managed to collect from toll gates? You find that the figures are not there. And if you look at this kind of set up, it was primarily set up for purposes of road rehabilitation as well as contributing to issues of road construction. I personally or CTPD has a long struggle with representatives from the National Road Fund because we just ask basic questions like tell us, how much has government collected from toll gates? And there hasn’t quite been a convincing response. So the levels of accountability in Zambia are very low and a lot needs to be done,” said Mwaipopo.
And a governance activist Pamela Chisanga observed that it was unfortunate that the country could still be talking about strengthening the country’s systems 53 years after independence.
“I don’t have evidence based information like Madam Bernadette Deka but I will tell you what I observed as a governance activist. We know that people who aspire for public offices, they hold rallies and tell us what they do when we vote for them. They tell us they will turn stones to gold and we will be able to live happily as a country and we believe them because we have no reason to believe that they will not do what they are telling us. But when they get into these offices, do they really do what they tell us? I a cannot believe that after 53 years of independence we are still talking about systems to procure things, to be able to catch people who are stealing,” said Chisanga.