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Lovemore Zigara Midlands Correspondent
NGEZI Member of Parliament, John Holder, has called on the government to revisit the community share ownership trust models so that communities derive maximum benefits from their resources.
President Mugabe launched community share ownership trusts in 2011 where various mining companies pledged various amounts of money as seed capital to kick-start the trusts to initiate developmental projects.
Under the Indigenisation and Economic Empowerment Act, foreign owned mining companies are required by law to relinquish 51 percent shareholding to locals and 10 to community share ownership trusts.
Holder told Business Chronicle on the sidelines of the Midlands Alternative Mining Indaba organised by the Zimbabwe Environmental Law Association (Zela) in Shurugwi that the government should revisit the 10 percent shareholding given to communities in which they get a dividend only when the mining companies make a profit.
The lawmaker said communities should be given 10 percent of the revenue realised regardless of the fact that the mining company would have made a profit or not.
“I am disgruntled with the community share ownership trust models. The problem is that the 10 percent is based on profits the mining companies are making. The danger is companies may under declare profits or claim that they have made a loss which will be detrimental to the trusts,” said Holder.
“What should have been done was that the mining companies should give 10 percent of the revenue realised from whatever they would have extracted regardless of whether they would have made a profit or not.”
The two-day Indaba ran under the theme: “Creating space for community voices on mining” and seeks to raise awareness to communities on their rights with regards to mining in their areas.
The National Indigenisation and Economic Empowerment Board (NIEEB) recently disclosed that $8 million had been utilised over the past two years.
Holder said he would pursue the matter in other forums.
Shurugwi South MP, Tapiwanashe Matangaidze, speaking at the same indaba, said there was no transparency and accountability in the manner funds for the trusts were being used.
He said since money being held by the trusts were public funds, they should hold annual general meetings where they invite members of the community and show how they would have used the money.
NIIEB acting legal and corporate secretary Rangu Nyamurundira said of the $109 million pledged by the various companies towards community share ownership trusts, $30 million had been given to them.
In a bid to ensure that communities benefit from mining companies operating in their areas, government established community share ownership trusts.
derick.khumalo