Government explains payment delays to contractors

The delays in paying contractors is a result of the due digilence which the govrnment has to carry out
after some of them were charging extortionate prices, a cabinet Minister
has said.Minister of Presidential Affairs and Monitoring Implementation of
Government Programmes Jorum Gumbo said this after touring the
Gwayi-Shangani water pipeline project as well as the National Railways
of Zimbabwe (NRZ) coach and wagon refurbishment centre.

The government in August this year directed all Ministries, departments
and agencies (MDAs) to suspended payments to service providers as part
of efforts to halt a slump in the local currency which was fueling
hyperinflation.Finance and Economic Development permanent secretary George Guvamatanga
issued the directive after the Treasury had noticed that some of the
contractors were submitting invoices of cash for goods and services
using parallel market rates.

The MDAs are required to seek approval from Treasury for current and
future contract pricing and share with it their due diligence on
existing charges.

I have taken note of the challenges that are impending the smooth
implementation of the project. In particular, my attention has been
brought to the fact that the contractors were last paid at the beginning
of the year and that the advance payment for the contractors and pipe procurement are always not being disbursed in time, said Gumbo.Allow me to point out that Government has been fighting the scourge of
extortionate pricing by service providers including some contractors,
which lead to distortions in the economy.

As a result, slight delays have been experienced in payment to service
providers because Government has to carry out due diligence process.The Second Republic is implementing the construction of the Gwayi-Shangani Dam and pipeline which was first mooted in 1912 but failed to take off under previous successive admistrations.When complete, the pipeline will have the capacity to convey in excess of 160 000 mega litres of water to the city of Bulawayo annually.Gumbo urged local communities to participate in the project through
taking up employment opportunities in various aspects of its
implementation.

In my view, community participation promotes a strong sense of
ownership for the project. The rapid development that we seek to achieve
through the 100 Day Cycle Programme can only be achieved if communities
are allowed to actively participate in the projects as opposed to being
passive beneficiaries, he said.Turing to the NRZ, Gumbo said a lot still needed to be done to turn
around the fortunes of the entity.

He said it was critical that the NRZ be resuscitated as Zimbabwe was located centrally in the region, which made it easier to move bulk cargo between countries.