The Reconstruction of State Indebted and Insolvent Companies Act (Reconstruction Laws and Regulations) gave government a carte blanche to wrestle SMM from Mawere saying his companies were indebted to the state.
With interests across virtually all the sectors of the economy, SMM was deemed to be indebted to the State by virtue of owing money to the central bank (Z$30 billion), a Z$252 million debt to the National Social Security Authority (NSSA), Minerals Marketing Corporation of Zimbabwe (Z$396 million), Zimbank (Z$20 billion), Zesa (Z$8,2 billion) and owing the tax collector, Zimbabwe Revenue Authority (Zimra) of Z$49 billion.
In a comprehensive report to parliament, the portfolio committee on Mines and Energy urged a cautious look at the legislation.
“A law that arbitrarily converts claims of state-owned institutions to state obligations governed under the reconstruction laws has to be carefully examined and interrogated by the House,” it said.
The committee observed the selective and arbitrary application of the clause on state indebtedness.
It said some of the companies listed as state entities had legal powers to claim any debts without the state’s assistance.
“A question then arises whether this was a prudent decision on the part of the executive.
“The committee would not like to see or to support the selective and arbitrary application of the law,” the committee said.
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It said the concept should be applied to all companies without discretion.
“The Reconstruction of State Indebted and Insolvent Companies Act (Reconstruction Laws and Regulations) if assigned to any authority with mischief can result in many of our farmers and many companies in mining, manufacturing and commerce who owe or are in debt to RBZ, Zimra, Zesa or Nssa being state indebted and being put under reconstruction,” the committee said.
Mawere lost his prized possessions in 2004 after government said his companies were indebted to the State.
Prior to that, government had specified and then issued a warrant of arrest on the businessman accusing him of externalisation of foreign currency. The specification was revoked last year while the warrant of arrest was cancelled the same year enabling the businessman to attend a hearing called by the portfolio committee on Mines and Energy.
POOR CO-ORDINATION BETWEEN MINISTRIES
The committee said there seemed to be no collective responsibility between the ministries of Home Affairs and Justice on the reasons leading to the despecification of Mawere.
It said Justice minister Patrick Chinamasa had told the committee that he was not aware of the reasons why the businessman was despecified.
He further told the committee that under the Reconstruction Act, the administrator, Afaras Gwaradzimba had not cleared Mawere.
On the other hand, the committee noted that the permanent secretary in the ministry of Home Affairs, Melusi Matshiya had briefed the committee that thorough investigations had been done.
He told the committee that consultations, including with the Ministry of Home Affairs, were made before the specification was revoked.
“The committee is deeply concerned that three ministers who sit in the same cabinet have not been able to assume collective responsibility on a matter of such critical importance,” the committee said.
