Friday, August 30, 2013

Only credible institution attacked by virus

Mozambique’s Central Office for the Fight against Corruption (GCCC) is investigating possible criminal practices at the Administrative Tribunal, the body that is supposed to check the legality of public expenditure. The director of the GCCC, Ana Maria Gemo, told reporters on Thursday, that prosecutors have already begun working on the accusations against the Administrative Tribunal, which were published in considerable detail in last week’s issue of the independent weekly “Savana”.The “Savana” story drew from a leaked audit, carried out by the consultancy firm Deloitte and Touche which alleged irregularities in tendering, improper advance payment to suppliers, payment of undue allowances, and the hiring of Tribunal staff themselves as consultants.The audit, covering 2012, noted that 36 per cent of the contracts for providing the Tribunal with goods and services were awarded directly, without any public tendering, in violating of the regulations on tendering. The amount of money spent on these awards was over 103 million meticais (about 3.45 million US dollars).The Tribunal defended itself to the auditors claiming that all the direct awards were made under the various exceptions envisaged in the tendering rules. Thus a state body may award goods or services directly, without public tender, if there is only one supplier in the market, or under emergency conditions, or when the contract is for military purposes, or when the amount concerned is less than 87,500 meticais (for goods or services), or less than 175,000 meticais (for building work).Deloitte was not convinced. The auditors remarked “we consider that the direct award of contracts is always an exception”. The Tribunal did not show that the contracts signed were economic or efficient, and the direct awards “compromise the principle of free competition”.
One example was the award of a contract, worth 56.3 million meticais, for installing a data and voice network inside the Tribunal’s new headquarters, to the company Triana without any public tender.The Tribunal justified this on the grounds that it would have taken several months longer to install the system had the normal tendering procedures been followed. This excuse, Deloitte said, meant in reality there had been “a lack of adequate planning”. Furthermore, there was no evidence that Triana had presented the legally required bank guarantee for half the sum (28.1 million meticais).Deloitte found that, in a blatant conflict of interest, the Tribunal hired its own staff, including the Tribunal’s general secetary, Luis Herculano, as consultants. For this work, Herculano was paid almost 900,000 meticais on top of his normal wages for the year. Four other Tribunal staff members were also hired as consultants. In every case, payment to these “consultants” was authorised by the presiding judge of the Administrative Tribunal, Machatine Munguambe.The audit also found that staff members were exceeding the limits on their use of cell phones paid for out of the Tribunal budget. Each member of staff is entitled to an allowance of 2,000 meticais a month for mobile phone use. The Tribunal’s excuse for greatly exceeding this allowance is that its staff were using their phones to access the Internet, a possibility not considered when the Finance Ministry drew up the norms for communication allowances.Deloitte had no choice, however, to stick to the letter of the law. “The allowances are not authorised by the Minister of Finance, the only authority competent to authorise allowances and their limits:, it pointed out. The total excess cell phone payments detected by the audit amounted to over 746,000 meticais.The auditors also thought it “a grave financial irregularity” to pay in advance, with sums from one year’s budget, for goods and services for the following year. The Tribunal had done this in regard to cell phone payments – it paid 950,000 meticais to the phone companies M-Cel and Vodacom in late 2012 for 2013 invoices that it had not yet received.
The Tribunal has a perfectly good explanation for this. Because the monthly budget instalments are disbursed late by the Finance Ministry’s National Treasury Directorate, it made good sense to use funds left over from the 2012 financial year to ensure that the Tribunal could continue to operate normally in early 2013.Good sense it is – but the auditors can only operate within the law, and the Law on the State Financial Management System (SISTAFE) states categorically “Expenses can only be paid during the financial year for which they have been budgeted”.Deloitte also questioned the payment of almost 60 million meticais to the national airline LAM, for air tickets, vehicles hire and accommodation. The invoices for flights could not be related to specific tickets, and the invoices for car hire did not specify the type of vehicle hired and for how many days. Accommodation invoices did not specify the names of the persons concerned and the length of their stay.Without such details, said Deloitte, “it is impossible for us to confirm the integrity of all the sums paid to LAM”.It is embarrassing that the Administrative Tribunal, which is the highest audit body in Mozambique, should have been found so wanting in its own procedures by an international auditing company.


The Mozambican Tax Authority (AT) on Wednesday announced that the true payment of capital gains tax on the sale of shares in Area Four of the Rovuma Basin by the Italian energy company ENI to the Chinese National Oil and Gas Exploration and Development Corporation (CNODC) is not 400 million but 530 million US dollars.ENI heads the consortium exploring for hydrocarbons in Area Four of the Rovuma Basin, off the coast of the northern province of Cabo Delgado, where vast deposits of natural gas, amounting to some 80 trillion cubic feet, have been discovered.ENI signed an agreement on 13 March with the Chinese company was to pay 4.21 billion US dollars for 28.57 per cent of the ENI stake in Area Four. Since ENI held 70 per cent of the rights to Area Four, this equated to 20 per cent of the total stake.According to an AT press release, the tax is paid partly in cash and partly in kind. The 400 million dollars refers only to the cash payment, which is 32 per cent of the amount on which tax can be charged. This amount is not the full 4.21 billion dollars of the purchase, but only 1.25 billion dollars – the reduction is due to the length of time that ENI has held the rights. The TA release reproduces the equations used to show how much tax was owing.The second payment is in kind, taking the form of investment of 130 million dollars in building a 75 megawatt power station in Palma, the northern district where ENI plans to build its liquefied natural gas (LNG) plant. Under the agreement, the Mozambican state will own 100 per cent of the power station, but will not bear any of the risk in building it. The power station should be operational by 2018, when the start of LNG production is forecast.The TA points out that this is by far the largest amount Mozambique has ever received in capital gains tax. The cash payment alone is equivalent to about 2.5 per cent of Mozambique’s Gross Domestic Product, and is 74 per cent more that the fiscal contributions of all the mega-projects put together in 2012.

Wednesday, August 7, 2013

Urban terrorism?

The Maputo Provincial Assembly meets in session next week VIII Matola city, and one of the issues that will dominate the attention of the meeting will be the session of questions to the parties Renamo and Frelimo government, on the wave of assaults accompanied by violations sexual and physical abuse caused by flat irons on the outskirts of the city of Matola. In neighborhoods Socimol, Nkobe, Mathlemele, Singatela, San Damasso in Administrative Post Machava and Dlavela, Mapandane, May 1st, and Kongolote Intaka in administrative post Infulene were activated patrols organized by the residents themselves. In these areas, from midnight does not sleep. Men and women wielded with sticks, machetes and other blunt instruments patrol the streets up to 4 hours. According to reports on the ground, on wrongdoers group of two dozen, make yourself be transported by a mini-bus of 18 seats. When they reach the homes of the victims, using levers, force the railings, doors and windows to introduce in homes. Sexually violate the hosts (both women as well as men). Steal and then connect to the mains irons and burn victims, preferably men. Matthew Tomo, head of the Renamo parliamentary group in the provincial assembly, said yesterday on the sidelines of the preparatory meeting of the seventh session of the Provincial Assembly, one of the questions to ask the Government will be the wave of crime that is ravaging the province of Maputo in general, and the city of Matola, in particular.

"There is a group of people is to sow terror in the suburbs of Matola. What is the Government doing to address this issue? "Questioned Tomo. In turn, the head of the Frelimo bench in the provincial assembly, Romao Muthisse, said that when it drew up the program of the VIII session there were no cases of "engomadores", but as is just come to work with the defense forces safety and to reduce the rate. "It is a concern that the Frelimo party has in the suburbs of Matola," he said.Individuals until now lot stormed the residence of a merchant, identified by Jessúb Abdul, 50 years old, in Manhica district, having robbed the house and then murdered the victim. The spokesman of the police command, Pedro Cossa said yesterday the usual press briefing that the miscreants when it introduced the residence demanded the victim to take away money and, minutes later, a shot of evildoers, having shot dead the citizen . "After the miscreants had taken the life of the victim, stole a car and other goods that were in the house." Cossa said the police are working to neutralize the gang and also calls for all surveillance and give your help to locate individuals who perpetrated the crime. Multiply cases of citizens who are assaulted and raped by a group of alleged criminals without the police do something concrete. In several districts around the city of Matola, is that the population is to patrol their own neighborhoods. Pedro Cossa said that the capacity of the state has to offer is the security that is already spread everywhere. However, he said, people evildoers are those who live in a society, the same have to cooperate, the authorities denouncing all criminal acts that occur in neighborhoods. "It is wrong to think that the police alone is that it must discover the whereabouts of the criminals, because criminals live in people's homes. These people have no courage to denounce their relatives to the police, "he said.Cossa denied knowledge of the patrol is to be made by the population in some neighborhoods of Maputo to control criminals who are creating terrorism. Thieves usually go armed with various blunt objects, including firearms.The week ends were registered 144 cases of criminal nature, of which 87 are against property, against 45 individuals and 12 against public order and tranquility. The police questioned and detained individuals in 1471, of which 1339 for violation of the border, illegal immigration and 12 120 in the practice of common crime. From neighboring South Africa, 40 Mozambicans were repatriated, including 18 men, 13 women and nine children. (A. Nhacuahe)