THE Procurement Regulatory Authority of Zimbabwe (Praz) has revealed that suppliers inflated invoices by US$19 million for goods and services during the tendering process ahead of the 44th Sadc Heads of State and Government summit held in Harare last August, NewsDay Business understands.
Last year, Zimbabwe hosted the seventh Sadc Industrialisation Week and the 44th session of the Sadc Heads of State and Government summit owing to the southern African nation assuming the chairmanship of the regional bloc.
In preparation for the two events, the government spent millions of United States dollars in improving the declining road infrastructure and constructing lodgings for regional heads of State.
However, in an interview with NewsDay Business, Praz chief executive officer Clever Ruswa said when conducting “value for money” audits on the procurement of goods and services for Sadc, it saved US$19 million.
“When the procurements were about to happen, people started saying no, ‘we are not going to achieve something because of Praz’. Then I said to myself, so surely, can I, be some person who can stop a national event? Then I went to whoever was organising, he said, ‘let us have this meeting’,” he said.
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“We met, and in that meeting, we made a resolution to say, we are going to give certain procurements where the entities will go and conduct direct procurements, but there are those where we feel there will be mischief and we need them to come through to us then we will
expedite.
“These are the ones where I am now mentioning that they (Sadc organisers) brought them to us, we challenged the figures, they dropped the figures within seven days by US$19 million.”
One of the exorbitant or overblown invoices received from suppliers includes the authorities accepting a bill of US$1 million to maintain a stretch of road of 1km.
Yet, Praz found that this cost could have been slashed to as low as US$10 000 per kilometre.
Ruswa said there are 360 public entities under the authority.
“When we are talking of entities under our purview, we are talking of all the commissions, we are talking of all the government ministries and departments, we are talking of all the SoEs [State-owned enterprises], and we are also talking of all the local authorities, which brings the number to the current number, which is almost 360,” he said.
Ruswa said these entities misinterpreted the value for money audits to suggest it meant acquiring the cheapest items from expensive suppliers.
“Most of us think that value for money is when we are talking about the cheapest price in the procurement process, and some are only talking about the procurement processes for operational needs, something that is just a cost-cutting approach for an organisation,” Ruswa said.
“The problem is when we are talking of the cheapest, we are simply focusing on the total cost of acquisition, not on the cheapest in terms of pricing because if we are talking of cheapest, we are again having some challenges.”
