12 October 2017

Zimbabwe: AfDB to Complete Finance Systems Project By Year End

The African Development Bank targets to complete its $24 million Public Finance Management systems project by the end of the year. The bank also committed some additional funds towards developmental projects, which are consistent with Government's priorities enshrined in its Interim Poverty Reduction Strategy Paper. Ministry of Finance and Economic Development Programme Manager Naome Chimbetete told The Herald Business that the Public Finance Management project was at its tail end.

"We are now doing final touch ups of the project and I am confident to say most Government institutions have managed to benefit from this funding including the Ministry of Finance and Economic Development and the Zimbabwe Revenue Authority. There have been a lot of developments around financial management systems from the grant availed by the AfDB. We expect the project to complete by end of year," said Ms Chimbetete. This comes as begun the process of aligning the Public Finance Management Act with the constitution to ensure that it is seamlessly implemented. Accountant-General Mr Daniel Muchemwa recently said in the process of aligning the Act with the constitution, Government will also make some other changes that might be deemed necessary to make the law water-tight.

"We are currently in the process of aligning the Public Finance Management Act with the constitution. We have worked out the principles of alignment but we decided to take advantage of that alignment to identify any other changes that we need to put in place now," said Mr Muchemwa. The Public Finance and Management Act, which makes major amendments to the Act of 2009, was gazetted and came into effect on October 28 last year. The Act regulates the management of finances in national and provincial government and sets out procedures for efficient and effective management of all revenue, expenditure, assets and liabilities.

Chief among the amendments to the Act relate to the interaction between responsible ministries in central Government and its parastatals. State Enterprises and Parastatals (SEPs), which are largely loss making entities at the moment, are required by the Act to prepare and submit quarterly financial statements to Treasury. Currently, some SEPs last released financial statements in 2012, yet they continue to pay excessive salaries to executives and board fees. Section 51A of the Act specifies the roles of appropriate ministries and public entities, with Subsection (iv), prohibits SEP bosses from accepting or receiving "any monetary or other benefit inconsistent with the discharge of the appropriate Ministry's supervisory or regulatory role, including (but not limited to) any payment or benefit in the way of or in the guise of - (a) management committee allowances; or (b) trustee or trustee representative allowances; or (c) travel allowances, fuel coupons or holiday allowances . . ."

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