adminrevenue at the company from US$1,4 million per month in June 2009 to US$200 000.
The Parliamentary Portfolio Committee on Local Government, chaired by Chimanimani West MP, Mrs Lynet Karenyi (MDC-T) also took the board to task over the alleged conflict of interest by board deputy chairperson, Mr Nelson Kangausaru whom they said is doubling as board member and the acting chief executive.
The committee expressed concern at the decision by the board to pay a worker US$97 000 in terminal benefits over a disciplinary case Zupco lost involving misappropriation of 10 litres of fuel.
Zupco board chairperson Professor Chipo Dyanda said the firm needed recapitalisation to deal with the problems it was facing.
She said they had taken a deliberate position to save a certain percentage of revenue to buy more buses. Prof Dyanda said the buses were not bringing in much revenue.
In 2009, she said, the transport utility took a decision to save money to buy more buses.
She said Zupco was saddled with huge debts which included retrenchment packages.
On Mr Kangausaru, Prof Dyanda said the board allowed him to act as CEO after the incumbent Mr Morris Sakabuya fell ill.
“We are empowered by the company’s Articles of Association to do that. The board in its wisdom and at that time we were trying to recapitalise, we said we had to take one of our own who knew the vision we wanted to achieve,” said Prof Dyanda.
She said the status of Mr Kangausaru, who is still acting CEO, will be determined at the company’s annual general meeting in consultation with the shareholder.
Chiredzi South MP, Cde Ailess Baloyi (Zanu-PF) said if a CEO resigns or is unable to perform his duties, they should either advertise the post or put one of the managers at the helm. He said taking a board member whose role is to oversee management to act as CEO defeated the principle of corporate governance.
But Prof Dyanda said there was nothing irregular.
She could not, however, commit herself whether the board would eventually advertise the post or appoint Mr Kangausaru, saying a decision would have to be made at the AGM in consultation with the shareholder.
On the labour dispute between the firm and procurement manager Mr Emmanuel Madry, Prof Dyanda said the company lost the case in court after management failed to attend the hearing and was treated as an unopposed matter.
Online Reporter