Zimbabwe: Chiefs’ Council in U.S.$300,000 Vehicle Purchase Scam

By Costa Nkomo
The National Council of Chiefs in 2018 bought four vehicles – Isuzu KB 250 Double Cabs D-Tek 4 x 4 – at an inflated price of US$125 000 each, instead of the US$50 500 agreed on.

The discrepancies resulted in the state being prejudiced nearly US$300 000.

The shocking details are contained in the Report of the Auditor General (AG) For the Financial Year ended December 31, 2019, on Appropriation Accounts and Fund Accounts.

Mildred Chiri is the AG.

The National Council of Chiefs was constituted in accordance with an Act of Parliament to represent all chiefs in Zimbabwe. Its operations fall under the Local Government Ministry currently headed by July Moyo.

Chief Fortune Charumbira of Masvingo province is the president of the National Council of Chiefs and Chief Lucas Mtshane Khumalo of Bubi District is the vice president.

“The Council of Chiefs bought four vehicles (Isuzu KB 250 Double Cabs D-Tek 4×4) on October 28, 2018, through the pay net facility at a total cost of $499 999,” reads part of the Auditor General’s 2019 report.

“The vehicles were purchased for a total value of US$499 999 with each vehicle costing US$125 000 and the supplier’s invoice dated October 29, 2018, quoted in USD, showed the total of US$499 999.”

However, according to the report, the chiefs bought the four vehicles at an inflated price against the recommendation of the State Procurement Board (Procurement Regulatory Authority of Zimbabwe, PRAZ), which ordered that the purchase price should not exceed US$50 500.

“An (maximum) amount of US$50 500 was approved for each vehicle giving a total of US$202 000 for the four vehicles. The Council, therefore, procured the vehicles at a cost that exceeded the authorised amount by US$297 000.

“No documentation was availed as authority to acquire the vehicles at a price higher than originally approved.”

The report further notes the same four vehicles could have been purchased at an ever-lower price of US$38 000 using the latest 2021 market prices.

“Furthermore, market analysis revealed that the price for the same vehicles ranged from US$38 000 to US$70 000 as of January 19, 2021. Therefore, I was not satisfied that the entity got value for money out of this purchase.”

Using the highest market price of US$70 000 the total value of the vehicles come to US$240 000.

However, its defence, the National Council of Chiefs said it bought the four vehicles using the local Zimbabwe currency and, therefore, the half US$500 000 cannot be compared with the local currency.

“Please note that the price on the tender was US$50 025 on June 22, 2017, but the quoted price per vehicle on October 29, 2018, was $125 000 RTGS. So, the two cannot be compared,” the chiefs said in their response.

However, Chiri argued saying exchange rate at the time of purchase was 1:1.

“The exchange rate that was used was not specified, however, at the time of procuring the vehicles, the official exchange rate of ZWL to USD was one to one (1 USD:1 ZWL).”

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