Hwange Colliery Company Limited (HCCL) was once synonymous with the Matabeleland North economy, with thousands of people working in the mines and more in economic sectors downstream and upstream.
News in depth BY FRANCIS MWINDE
Being an employee of the colliery was a dream job, with hundreds of people coming from all over the country for what was then believed to be once-in-a-lifetime opportunity to work for the country’s biggest coal-miner.
Working there was a privilege, with often cushy salaries, unbelievable incentives and, above all, a community, which all believed in the Hwange dream.
While it was unthinkable a decade or so ago, Hwange’s prospects have rapidly deteriorated, its fortunes are on the wane and it has suffered the ignominy of being put under administration following years of poor management and bad corporate governance.
In some cruel twist of fate, this could be a throwback to the misfortunes of Shabanie-Mashaba Mines (SMM), whose administration was taken over by the state and has not recovered since. With this in mind, the Hwange community could be staring at a bleak future, where their dreams, hopes and fortunes have been thrown down a bottomless pit, literally.
Hezekiah Mudhimba, whose three siblings are employed by HCCL, fears the giant coalminer is going the same way as SMM and would spell disaster for his extended family.
At least 4 000 SMM workers were rendered jobless and their families are now struggling for survival amid unfulfilled promises by the government that the asbestos mines would be revived.
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“It seems (the decision to place HCCL under administration) is the epitaph of the colliery company and it will only be a matter of time before everything comes to a standstill as far as this mine is concerned,” said a dejected Mudhimba.
“I am glad that most colliery employees are aware of the pitfalls associated with the so-called reconstruction or as they are bound to lose everything and there will not be any form of redress just like what happened to Shabanie Mine.”
Justice and Parliamentary Affairs minister Ziyambi Ziyambi two weeks ago used the Reconstruction of State-Indebted Insolvent Companies Act to place HCCL under reconstruction.
Ziyambi appointed Bekithemba Moyo, a co-founder and director of DBF Capital, as the administrator for the giant coal-miner.
Moyo, a former top banker, will be assisted by experienced lawyer Mutsa Mollie Jean Remba, who is a managing partner at a leading Harare law firm that specialises in commercial and company law, and Munashe Shava, the chief operating officer at Great Dyke Investments.
Great Dyke Investments is a platinum group metals company, which is jointly owned by the Zimbabwean and Russian governments.
Despite the experienced administrators charged with turning around the fortunes of the Zimbabwe Stock Exchange (ZSE)-listed company, observers like Mudhimba and some HCCL workers do not foresee the return of glory days at the colliery.
“At first I did not believe the news that Hwange had been placed under administration until someone posted a copy of the Government Gazette where this issue was spelt out,” said a colliery employee who only identified himself as Lungu.
“We are anxious to know whether we will continue getting our salaries during the new administration through the scheme of arrangement.”
The majority of HCCL workers are owed close to five years’ salaries and the colliery only resumed paying them in May 2017 following the High Court-sanctioned scheme of arrangement.
HCCL opted for the arrangement with creditors to avoid litigation in the face of mounting debts. Lungu blamed the colliery’s demise on mismanagement and corruption, which, he said, had become rife in the past few years.
“During my 26 years of service with Hwange Colliery, I had never come across a board, which had the guts to suspend senior managers over corruption and insubordination,” he said.
“Some of the managers were now becoming a law unto themselves and did not even bother to listen to workers when they raised issues.
“The other day a fellow workmate lost her father-in-law due to diabetes complications after one of the managers declined to assist her with $200 so she could take him to Bulawayo for further treatment.
“She was told the company had no money, but on that particular day Harare-based managers were given salary advances of at least $10 000.”
The crisis at HCCL reached a climax in May when then managing director Thomas Makore was suspended before opting to resign after accusations of fraud and insubordination were raised against him.
The company’s board later suspended top managers that included Shepherd Manamike (acting managing director), Tawanda Marapira (finance executive), Raymond Munangwa (human resources), Fidelisy Chamunorwa (information technology), Beauty Mutombe (sales and marketing), Misheck Sithole (strategic sourcing), Fortune Nyoni (human resources) and Paradzai Makunde (chief accountant).
Following the suspensions, the four-member board led by acting chairperson Juliana Muskwe instituted a forensic audit, which insiders said was heavily resisted by Mines minister Winston Chitando.
Other board members were Ntombizodwa Masuku, Valentine Vera and Edward Tome.
Chitando is a former HCCL board chairman and most of the suspended managers were recruited during his tenure at the colliery.
In January, wives of colliery employees led a massive demonstration against the company’s management after HCCL failed to honour its commitment under the scheme of arrangement to pay regular salaries.
This was despite government availing more than $200 million worth of treasury bills towards the scheme.
The women, who went on to camp outside the mine for several weeks, accused Makore and other managers of being corrupt. Chitando, the newly-appointed Mines minister at the time, failed to travel to Hwange to meet the women and the government deployed former Home Affairs minister Obert Mpofu.
Mpofu failed to douse the flames and the government then sent former Labour minister Petronella Kagonye but to no avail. The women argued that some of the problems facing the colliery started during Chitando’s tenure.
However, they dispersed after Makore’s resignation amid assurances that payment of backdated salaries through the scheme of arrangement was going to be implemented as a matter of urgency.
The promises have not been kept. For the past three months, HCCL has not been able to honour its obligations to employees and creditors.
Some of the suspended managers could not account for more than $4 million and this is cited as one of the reasons Hwange is struggling for survival.
Workers said they were caught unware by the decision to put HCCL under administration as they believed the company was on a recovery path as evidenced by the recent reopening of Three Main Underground mine.
The underground mine was decommissioned during Makore’s era due to flooding and obsolete mining equipment.
Hwange Colliery workers’ committee chairperson Deliverance Nyoni told Parliament’s mines committee chaired by Norton legislator Temba Mliswa that the Reconstruction Act in its current form did not recognise the rights of employees.
“We have been denied as workers the right to hold meetings and the so-called administrator is yet to have a meeting with us,” he said.
“We are supposed to work as slaves of the administrator without any rights.”
Nyoni accused the colliery management of sabotaging the business by bringing on board dubious contractors that did not offer the company any value. He said corruption and nepotism had also killed Hwange.
“There is systematic hiring of incompetent managers from closed entities such as Bindura Nickel Corporation as well as Zimasco who have nothing to show in their curriculum vitaes save for having worked at closed mines,” he said.
“At a time when we are busy saying Zimbabwe is open for business, we are making a mockery of our good president (Emmerson Mnangagwa) who is trying to lure investors into the country.
“We plead with you as workers of Hwange Colliery not to allow this (reconstruction) to happen.”
Besides the ZSE, HCCL is listed on the Johannesburg Stock Exchange and London Stock Exchange. It was suspended from the three bourses following the move to place it under reconstruction.
Hwange, which was listed on the ZSE as far back as 1902, was one of the most sought after blue chip companies until the government took over the Anglo American Corporation stake in the coal miner in the mid-1980s.
