MINISTRY of Home Affairs Permanent Secretary Dr Masiye Banda says he decided to reverse a contract to procure arms from South Africa because it was bogus and in breach of financial management regulations.
And Dr Banda says he has managed to trace the accountant who went ahead to make such an illegal payment in this transaction, vowing that he will be charged appropriately.
Dr Banda said this in response to a question from Chavuma UPND member of parliament Victor Lumayi when he appeared before the Parliamentary Accounts Committee (PAC), Monday.
According to the findings of the Auditor General, the Zambia Police Service engaged Gun Pro Africa Limited to supply and deliver various types of munitions at a contract sum of K499,827 with a delivery period of four to eight weeks.
From the date of signing the contract, an amount of K430,886 was paid to the supplier on December 27, 2019, leaving a balance of K68,941, but by August 31, 2020, the procured items had not been delivered, six months after the expected date of delivery and the Service had not taken any action against the supplier.
And during the PAC sitting when this item was being considered, Lumayi wondered when the Permanent Secretary knew about the contract and how he managed to secure a refund from the supplier.
In response, Dr Banda said he decided to recall the funds because even the manner in which the payment itself was made was in breach of financial management regulations.
“Thank you so much Honourable Chairman, I came to know about this, of course, I just reported and when I reported a few days ago, the audit report came. I looked at the correspondence. First of all, the contract; how it was handled; how it was couched; how it was executed. I looked at it as bogus and now the Inspector General of Police (Kakoma Kanganja) tried so hard, he tried so hard to have this ammunition come. He made several requests, several correspondence and so forth. Obviously, this is a supplier that they had dealt with before, but we do not know what challenges he faced inside there. So, when I looked at that, even the payment itself was made in breach of the public financial regulations and then he is not delivering, he has problems between himself and the South African government, something which is outside our control. For us, we are not in control with it, which means for this matter to go and be resolved, it depended very much on the supplier and the South African government other than us. We decided to recall the funds. So, we thought the funds should just come, we secure government funds, and thank God, the funds came. I submit,” Dr Banda said.
But in response to Chinsali PF member of parliament Kalalwe Mukosa, who wanted to find out who made the payments for the ammunition, the Dr Banda said he was yet to find out where the procurement process started and who was involved.
“Honourable Chairman, I would want to submit to this honourable Committee that I have since written to the Director-General to find out where, because the procurement I think started from the other side of the department, to find out who was involved in this particular… Mr Chairman, I have written clearly in that letter that these people must be found wherever they are, whether they have been transferred or not so that we can invoke the provision of the Public Finance Management Act Number One of 2018. So, I have written, once these particular officers are found, I want to assure this Honourable Committee that charges, like I have charged other people you will see later on as I appear tomorrow (Tuesday), they will have to be charged appropriately. These audit queries, Chairman, I want to mention that they can be avoided if we get on the trajectory of invoking the provisions of the Public Financial Management Act Number One of 2018,” he said.
“Mr Chairman, this is regrettable, this is deliberate, and this is intentional, therefore, unacceptable. The public procurement regulations are very clear as the Honourable member has said, even the contract itself, I examined it, I went to see the contract, I examined the contract, the contract says, ‘advance payment was supposed to be 25 per cent. How then, I questioned them, ‘how one could, because all these questions, of course, I found them, but I take responsibility; how then, one could go and make a payment of 70 per cent; the contract was in black and white. I have been looking for this particular officer because for the finance department to make a payment, there must be somebody who initiated this contract and I have been looking for the person who initiated. I am glad, Honourable Chairman, that last evening, I was able to find this particular officer who initiated; he has been transferred from the Zambia Police Service Headquarters that’s why you see it has taken us almost three weeks to be able to find them. That’s why I did mention that it depends on the time it can take. We found this officer last evening and we are going to invoke the provisions of the Financial Management Act of 2018 and I am serious and I mean it. This was irregular, it shouldn’t have been. I submit.”
And Zambia Police Service Finance Director, only identified as a Mr Mukimba, failed to provide answers as to who made the payment, stating that he had recently taken office and would need to liaise with his predecessor to have a response for the Committee.
“My contribution on this particular case, members of the Committee is that, I just joined Zambia Police recently, my colleague that was sitting in is in another Ministry so we will be able to provide more details after we consult with him, sir,” said Mukimba
Earlier, in response to Lumayi on the status of undelivered uniforms, Dr Banda said the Ministry collected the uniforms that were left undelivered as highlighted in the Auditor General’s report.
“Mr Chairman, first of all, I wish to accept that this is extremely irregular and the public procurement regulations are very, very clear. It’s not in order for the payments to be made either in full unless the contract maybe states 25 per cent, but the payment must be made once the goods have been delivered ex-stock. Although the query revolved around uniforms not to be delivered and Honourable Chairman, the uniforms have since been delivered after I made frantic efforts and as controlling officers I wrote to the supplier that I was going to personally report to the Zambia Police or to the Anti-Corruption [Commission] so that this supplier and whoever was involved are prosecuted. After I wrote that because I did not accept it, it’s unacceptable, as a controlling officer, I could not accept it. Once I wrote that letter, the uniforms just took two days, they were delivered. So, this payment of making such payments before the goods are even delivered, Mr Chairman, it’s regrettable and going forward as controlling officers, as you are aware, all these queries I found them, but I want to take responsibility as a controlling officer even when I found these queries,” he said.
“Procurement of goods, failure to deliver paid for uniforms. On 9th of December, 2019, the Ministry of Home Affairs ordered 700 combat uniforms from Prime Link Investments Limited costing K343,000 and the supplier was paid in full on 25th of December, 2019. On the 22nd November, 2019, the supplier delivered 514 combat uniforms costing K250,900 leaving a balance of 186 uniforms costing K91,140 not delivered as at 31st July, 2020. Corrective action. The Committee may wish to note that the supplier delivered the balance of 186 uniforms, the auditors were invited to re-verify and the matter was resolved as per the final status report to the draft audit report paragraph number 2704.”
And Solwezi West UPND member of parliament Teddy Kasonso questioned the timing on the query as it showed that the items were supplied before the order was made.
In response, Dr Banda said that the dates would need to be counterchecked as the Ministry was not aware of the error in the query.
“Mr Chairman, thank you so much. This is how the query came out, but I must say that, indeed, because we didn’t even pick it ourselves. We may need to countercheck this because what it shows is that they delivered the uniforms before. We may need to countercheck because if this was the case, this was extremely irregular! But I think we may need to countercheck,” said Dr Banda.
And Chairperson of the Committee Howard Kunda directed the controlling officer to avail the necessary officers, who will provide all the necessary information in relation to the contracts in question as the Ministry appears before the Committee again.