Zim News Blog -NEWS NETWORK

Source: Public procurement should follow the law to the letter | Herald (Business)

The Procurement Regulatory Authority of Zimbabwe will from this month, publish a weekly column entitled Public Procurement Matters to provide clarification on public procurement related matters. It is Public Procurement Matters in that it discusses issues relating to trade with the public sector. Public procurement matters in that when done well, the general public is assured of efficient and effective public services.

Background to Public Procurement Reforms

The debate on public sector management reforms and the promotion of good governance became the centre of discussion among donor agencies and citizens in Zimbabwe since the late 1980s and early 1990s. Since then several reforms have taken place with mixed degrees of successes and failures.

Regrettably public procurement reforms have only occupied a peripheral position in the broad public sector reforms in Zimbabwe since the late 1990s.

According to the World Bank, public procurement reforms point to review of the existing systems make them more responsive. It transforms organisational, institutional, and legal structures that manage public procurement processes to create responsive systems that encourage effective and efficient performance of the public sector.

Zimbabwe’s current reforms culminated in the Public Procurement and Disposal of Public Assets Act [Chapter 22:23] on August 4, 2017, which became operational on January 1, 2018. The Public Procurement and Disposal of Public Assets (General) Regulations 2018 were gazetted through SI 5 of 2018 of January 19, 2018.

Repealing of the Procurement Act [Chapter 22:14]

The procurement reforms in Zimbabwe took approach of repealing of the Procurement Act [Chapter 22:14]. This inevitably comes with some unavoidable transitional challenges.

Transitional Arrangements: Section 103

In order to provide clarification with regards to the execution of procurement contracts that were initiated before January 1, 2018, the new Act under section 103, provides for the transitional arrangements between the repealed Act and the new Act. Under the new Act, the “transitional period” means the period of two years from January 1, 2018 to December 31, 2019.

Sub-section (3) of the new Act further states that property or assets and any obligation which, immediately before January 1, 2018, vested in or, as the case may be, had been incurred by the State Procurement Board established under the repealed Act shall on and after this date be property or an asset or obligation of the Authority. From the onset it is imperative to note that the “transitional provisions” should not be misconstrued to mean a two-year period during which Procuring Entities are expected to fully comply with the law.

This is a misinterpretation of section 103 of the new Act; the new law became operational on 1 January 2018 and from that date onward all public procurement processes are expected to be in compliant with the provisions of the new Act.

Consistent with the spirit of avoiding the retrospective application of the Act, subsection 4 states that any procurement proceedings that commenced before January 1, 2018, shall be completed in accordance with the repealed Act, and any reference to the State Procurement Board being construed as a reference to the Authority: Provided that the Authority may, by written notice to the procuring entity concerned, direct that any provision of this Act that is specified in the notice shall apply to the proceedings, and that provision shall thereupon apply accordingly, subject to any modification stated in the notice.

This last provision implies that the Authority has the discretionary power to subject implementation of a contract enacted under the repealed Act to the provisions of the new Act.

Any direction or order which was given by the State Procurement Board under the repealed Act and which, immediately before January 1, 2018, had or was capable of acquiring legal effect shall continue to have or to be capable of acquiring, as the case may be, the same effect as if it had been given by the Authority.

Every procuring entity that wishes to conduct procurement proceedings for which authorisation is required in terms of section 15 shall, as soon as possible after January 1, 2018, apply for authorisation in accordance with the Third Schedule.

This means that with effect from January 1, 2018, certain procurement first need authorisation before being conducted.

Section 10 (1) of the Public Procurement and Disposal of Public Assets Regulations (SI 5 of 2018) provides that a procuring entity would need to be authorised by Praz to conduct procurement where they want to procure construction works above US$200 000.00 or equivalent; goods above US$100 000.00 or equivalent and services above US$50 000.00 or equivalent.

Failure to comply with this requirement has sanctions specified in Section 94 (1) of the same Regulations. Procedures for seeking authorisation to conduct procurement are contained in the Third Schedule of  the Act.

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Source: ‘Devolution unlocks value of natural endowments’ | Herald (Business)

Michael Tome Business Reporter
TRADE development and promotion body, ZimTrade has called for the immediate implementation of devolution citing a plethora of economic benefits that could emanate from the process.

Devolution is a statutory decentralisation or delegation of decision making to lower levels of government which includes, provincial and district authorities. From an economic dimension it encompasses fiscal, investment, trade and administrative issues among  others.

According to ZimTrade, devolution unlocks the value of natural endowments and enhances the ease of doing export business since it provides an alternative to geographical centralisation of permit and license issuing offices which normally cause delays and increased costs of doing business.

Generally, the centralisation of government offices in the main cities has become detrimental to the smooth flow of business especially for those stationed in the outlying areas, miles away from the capital city.

Government through the Ministry of Finance and Development has vowed to apportion $310 million to devolution.

In a statement released by ZimTrade, the issue of licensing and permit issuance remain a bottleneck to the flawless conduct of export business rendering the country poor in terms of competitiveness index on the global level.

“One of the biggest impediments to export growth is the local regulatory environment which is not facilitative of trade. From 2016, ZimTrade undertook a Rapid Results Initiative which was aimed at improving the ease of doing export business.

“Most recurring findings across different sectors was the geographical centralisation of permit and license issuing offices which was causing delays and increased costs of doing business,” said ZimTrade in the statement.

In recent times Rwanda has been endowed with mega investments owing to investor friendly climate that allows investors to complete paperwork in approximately six hours, resultantly figures from Rwanda’s Development Board (RDB) show that US$2 billion worth of projects were registered in the country by the beginning of 2019, boosted mainly by manufacturing and mining projects.

The organisation is optimistic the government will take a leaf from Brazil which has recorded a boom in economic activity owing to the promulgation of devolution.

“Local governments can unlock opportunities through policy interventions that create a facilitative environment. As early as 2001, Brazil, which is one of the strongest emerging economies, had implemented economic devolution and 35 percent of the country’s municipalities had implemented fiscal incentive programmes and income generating initiatives,” said the statement.

It is the organisation’s anticipation that devolution will bring opportunities even to some secluded communities in four corners of the country considering the export potential in niche products or skills some of the regions possess.

While they are somewhat from small value chains, Mopani worms can be exported from Matabeleland, moringa from the Zambezi Valley, baobab and amarula from the low veld as well as arts and craft from Masvingo as they can contribute significantly if they are value added, certified and exported to the high-end markets earning the much-needed foreign currency.

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Source: Government to complete rollout of public finance system | Herald (Business)

Tawanda Musarurwa & Kudakwashe Mhundwa
Government is set to complete the roll-out of the reconfigured Public Finance Management System (PFMS) to the remaining 60 extra-budgetary units before the end of this year.

In January, PFMS was re-designed with a new Chart of Accounts based on the Government Finance Statistics Manual (GFSM) 2014 following observations by the International Monetary Fund and the World Bank.

Significant progress has been made in the rollout.

According to the accrual-based International Public Sector Accounting Standards (IPSAS) national Implementation Strategy and Plan (ISP) that was launched yesterday, all ministries are now utilizing the re-configured PFMS.

“All ministries use the re-configured PFMS and about 40 out of about 100 extra-budgetary units have also been re-configured, with the remaining 60 due to be completed before the end of 2019,” reads the  document.

The updated PFMS will also be partially extended to local authorities.

“The PFMS team has designed a portal for local authorities to enable the uploading of their data onto PFMS through an interface.

“Each of the 63 districts will have its on kiosk and eight access points. The concept is about to be piloted in six districts and, working with the department of Central Computing Services, it is planned that rollout to all districts will be complete by the end of 2019.”

The re-configuration of the PFMS is part of broader initiatives by the Government to enhance accountability within its systems by moving from cash accounting to accrual accounting IPSAS.

IPSAS are a set of accounting standards issued by the IPSAS Board for use by public sector entities around the world in the preparation of financial statements.

PFMS is currently set up to deliver cash-based financial reporting, however input to the system is on an accrual basis.

The resulting reports include rudimentary balance sheet information, but the full accrual functionality of the system is not yet being utilised.

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A 23-YEAR-OLD lecturer at a little-known Harare college was last Friday sentenced to 12 years imprisonment for raping a student. The convict pleaded not guilty when he appeared before magistrate Gloria Takundwa, who, however, found him guilty and suspended four years on condition of good behaviour. He will serve eight years jail time. In convicting […]

Roads and bridges are being repaired in a dash to reach cyclone survivors.

Source: The New Humanitarian | Update: Zimbabwe’s slow road to cyclone recovery

The post Update: Zimbabwe’s slow road to cyclone recovery appeared first on Zimbabwe Situation.