MINES and Mining Development minister, Walter Chidhakwa has questioned the establishment of parallel management structures at Hwange Colliery Company at a time the organisation was failing to increase production following the much-publicised commissioning of $32 million mining equipment.
By Clanton Simuchembu
Chidhakwa, who last Saturday made an impromptu visit to the ailing coal mining giant, read the riot act to colliery management, demanding that productivity be increased within 90 days, failure which heads would roll.
“The minister was in a no-nonsense mood when he told managers that government as a major shareholder was not impressed with the goings-on at the colliery, where the managing director was on a recruiting drive while there was a duplication of roles in both finance and production areas,” said a source who attended the tense closed-door meeting.
“He ordered management to introduce cost-cutting measures such as doing away with unnecessary travels and also ordered that all key decision-makers be based at the mine and not in Harare. He also proposed a 50% salary cut for all executive managers whom he accused of being involved in ‘shady’ deals at the expense of hard working colliery employees, most of whom were wallowing in poverty,” said the source.
The minister is said to have quizzed the managing director, Thomas Makore why the underground mine — the main source of high quality coking coal — was not operational.
“The managing director failed to provide a satisfactory answer and he was told in no uncertain terms that the underground mine had to be seen to be operational as a matter of urgency. He also said the colliery board would soon be reconstituted, ushering in a new chairman following the departure of Farai Mutamangira.
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“From the look of things, more heads are certainly going to roll if a new board is put in place. The minister was really in an uncompromising mood as he challenged us to break even following the acquisition of new mining equipment,” said one of the managers who also attended the meeting.
The minister also met workers’ representatives separately where he briefed them on the three-month ultimatum he gave to management. Government recently cleaned the negative $65 million balance sheet which has since been turned into equity.
During commissioning of the newly-acquired mining equipment in June this year, Minister Chidhakwa warned the colliery board and management that time for production excuses was over as government had played its part in the procurement of new machines.
However, following the acquisition of the 24-piece machinery worth $32 million sourced from India and Belarus, production has never surpassed 150 000 tonnes per month even as management and board always claim that they are producing an average 300 000 tonnes per month.
Workers on the other hand are owed more than 27 months in salary arrears, while the board is reported not to have sanctioned the recruitment of managerial personnel in production, finance and public relations departments.
The colliery workers’ representatives have been at the forefront, questioning some of these recruitments which were done without properly laid-down procedures. They also raised a similar issue during the Parliamentary Portfolio Committee on Public Service, Labour and Social Welfare that visited the mine last month where they also called for the dissolution of the board.
The company’s ability to continue as a going concern has been on the spotlight after the organisation posted poor results for the half year ended June 30 2015 which indicated poor financial performance and plummeting production. Its current liabilities were exceeding its current assets by more than $148 million, up from $122 million as at December 2014.
