Online Reporter
THERE is now hope that Harare City Council may be able to run its finances efficiently, or at least find out what it is taking in and spending without vast sums that seem to just go missing or cannot be accounted for, totalling perhaps as much as ZIG13 billion (US$500 million).
In 2019, the council dumped its BIQ-ERP system when the annual licence fee rose from US$35 000 to US$75 000 a year, a drop in the ocean when compared to the revenues and expenditure of the city.
The replacement cost is US$350 000 for a system that is considered very good, but this applies to medium-size and smaller businesses.
Harare City Council is not a medium-size operation.
It is the second-largest Zimbabwean entity in terms of revenue and expenditure after the central Government itself, as well as the second largest in terms of its financial complexity and number of employees under the council and its subsidiaries such as City Parking.
There was also a problem in the switch over that not all data was properly mapped over, and the Auditor General in her reports for the 2018 and 2019 years was scathing about the state of the council’s financial records highlighting that US$200 million could not even be accounted for.
She was careful not to suggest this had been stolen or siphoned off corruptly, basically noting that no-one in the council administration was able to explain what had happened, or if it was an accounting error.
The reason why excellent accounting is needed with full records is so that every paper-trail can be followed to source, and if that is impossible then the accounts are sub-standard and not very useful.
She pressed then, and she and her successors have been pressing since, for Harare City Council to reinstall the BIQ-ERP system so that at least full financial records could be tracked down and accessed along with finding out what had happened since.
As a result of the inaccessible and missing information, the Auditor General was unable to certify the city accounts.
There was a serious movement in some sections of council administration around three years ago for the council to approve a US$51 million system, and high-powered teams of officials flew down to South Africa on several occasions to discuss the details.
It was suggested at the time that the trips were paid for by the South African supplier, although the council now says the ratepayers picked up the tab.
Perhaps they even claimed council expenses while having the potential supplier pay the costs. Without an open procurement process this is quite possible.
The expensive system was not bought. It was, almost certainly correctly, considered to be dramatically over-priced and in any case was not being considered as part of a normal tender process.
Finally, about six months ago, the original BIQ-ERP system was re-installed by Quill Associates, after the Ministry of Local Government and Public Works certified to the Procurement Regulatory Authority of Zimbabwe that the admittedly outdated system needed to be re-installed so data could be recovered and audits made possible.
The permission was for 12 months, but presumably this can be extended if necessary, and it will almost certainly be necessary because it is only now that the Harare City Council has asked the Auditor General to move in and perform a forensic audit to find out exactly what has been happening.
Such audits are not instant and digging through available records of such a large and complex organisation will be time-consuming.
The council has, to its credit, taken steps to preserve the data by giving officials read-only rights to the data, meaning they can see it, but cannot change anything.
That was a necessary precaution considering the sort of back-biting that is going on in official circles, with officials getting ready to blame each other, or even if the accounting mess goes beyond maladministration and includes fraud and corruption.
Already there are suggestions within the council and its administration that some officials are trying to delay the audit yet again. These may have substance or just be part of the survival policy of the leakers to build up credit and be able to blame someone else.
Once the full audit is complete, and if necessary incompetent staff replaced and any criminal staff charged and jailed, the city council will need to go through the transparent and open process of what to do next. An open process does not involve secret visits to suppliers by officials.
This might well be an upgrade of the Quill system, or its proper replacement by another system that sees all data from the Quill system and its modest replacement moved over.
Generally, once a high-powered system has been installed and is in operation, most businesses and other entities find it a lot cheaper and easier to upgrade that system so long as the upgrade meets modern standards, rather than switch.
But there are sometimes good reasons for a switch. Considering the council record, the proper process is needed and in the special circumstances we now have any replacement will need to be approved by the Auditor General on technical issues and the Government on the procurement process.
