Freeman Razemba — The Zimbabwe National Road Administration (Zinara) disbursed at least $43,8 billion to Road Authorities under the Emergency Road Rehabilitation Programme 2 (ERRP2) in 2022, an increase of 21 percent from the prior year in inflation-adjusted terms.
The move comes after the road administration yesterday regularised its annual general meetings after presenting its audited financial statements for the year 2022, making the parastatal a role model for good corporate governance among State-owned companies.
This also comes at a time when Zinara is on a rebranding drive following an adverse audit report in 2018 which flagged several corporate governance deficiencies including failure to hold regular annual general meetings.
According to the financial statements, in 2021, Zinara collected $94,3 billion in inflation-adjusted collections from road user fees as compared to $113,1 billion in 2022, marking a 43 percent increase as the business environment provided opportunities for growth post the restraining Covid-19 pandemic era.
Speaking at the Zinara annual general meeting which was held in Harare, Transport and Infrastructural Development Minister Felix Mhona, who was represented by his deputy Joshua Sacco, hailed the organisation for its unparalleled dedication to transformation in line with the National Development Strategy 1 (NDS1) and Vision 2030.
"Zinara managed to hold the 2021 annual general meeting just after the first half of the year and this year, the 2022 AGM being held today marks the conclusion of the regularisation of one of the key cornerstones of corporate governance; the publication of financials," said Minister Mhona.
"I understand Zinara has already engaged the Auditor General for the 2023 results to ensure that they complete the whole process before the end of the first half in line with corporate governance regulations. As the parent Minister, I am pleased with this drive towards attaining right standing by the board and management of Zinara," he said.
Minister Mhona commended Zinara for its unwavering commitment and hard work towards executing the role and mandate.
"Indeed the "new Zinara" is revealing itself more elaborately as you clear the backlog of legacy issues previously plaguing the system and the reputation of the organisation. Your dedication to the task of ensuring transparent and accountable funding for road maintenance and development has not gone unnoticed," he said.
Minister Mhona urged Zinara to further engage its stakeholders beyond the annual general meeting for more insightful ideas that could help to advance its cause.
Zinara board chairman Dr George Manyaya said the regularisation of the annual general meetings was a key milestone for the organisation as they charted a new path of transformation.
He said it was pleasing that despite the challenging operating environment, the road fund had remained resilient and had measured up in terms of funding the ERRP2 which reached its climax in 2022.
Zinara chief executive officer Mr Nkosinathi Ncube briefed the meeting that the institution had regularised its US$206 million debt with the Development Bank of Southern Africa and the outstanding balance was now less than US$70 million.
He said the funds collected by Zinara were limited hence the need for quality work by contractors.
"The resources that we have are limited and the only way we can extend them is by ensuring quality road works that can also last for longer periods," said Mr Ncube.
He said the financial year 2022 presented growth opportunities.
"The subsistence of the erstwhile exchange rate instability in the economy kept Zinara on its toes in churning out timely interventions meant to preserve the value of road user fees collected and the disbursements thereof in subsequence. Zinara leveraged on a supportive legislative framework such as dual pricing in order to ensure loss in value on revenue collected was curbed. Stability in revenue flows was registered in toll fees where 50 percent of motorists with free funds defaulted to making payments in foreign currency.
"Other revenue heads which remained stable included fuel levy and transit fees which by default are collected in foreign currency.
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"Strategies for cost containment have remained a critical success factor for the Road Fund, and in pursuit of this, the Road Fund managed to replace hired vehicles through procurement of a new fleet which has seen the cost of hiring significantly going down," Mr Ncube said.
On financial overview, Mr Ncube said inflation-adjusted collections from road user fees were up by 43 percent from $94,3 billion collected in 2021 to $113,1 billion in 2022, as the business environment provided opportunities foreeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeee growth post the restraining Covid-19 pandemic era.
"36 percent of total collections were contributed by group tolling (Zimtoll plus InstaToll), followed by vehicle licensing (31,7 percent), fuel levy (18,2 percent) and transit fees (11,5 percent) in that order; with the remaining 2,6 percent contributed by overload and abnormal load fees (1,34 percent) and other income (1,28 percent)."
He said disbursements to Road Authorities under ERRP2 closed at $31 billion, translating to $43,8 billion inflation-adjusted, which was 21 percent up against prior year inflation-adjusted disbursements.
