Staff Reporter
The High Court has nullified a multi-million contract awarded to a controversial company by the Zimbabwe Manpower and Development Fund (ZIMDEF) after ruling that there were gross violations of procurement regulations.
Zimdef which is currently led by Engineer Sebastian Marume as its Chief Executive Officer, had given the staggering contract to a company called Tano Digital Solutions after having inserted a clause in the call for bids which sought to favor it and defeat the quest for fair competition at the Procurement Regulatory Authority of Zimbabwe (PRAZ).
The contract involved payment of US$48 000 per month for 10 years to the shadowy Harare company for a controversial deal of installing and maintaining a computer software called System Analysis Programme (SAP) at its offices.
The software is used to decentralize data management but can be obtained at far less prices than quoted by Zimdef in the scandal.
All public procurements are done by PRAZ on behalf of government institutions like Zimdef. The entity in the past has been blamed of conniving with the institutions to inflate prices for contracts awarded to their favored companies.
The latest Zimdef scandal came to light when a prominent digital conglomerate company, Twenty Third Century (Pvt) Limited, launched an urgent High Court application challenging awarding of the contract to Tono Digital Solutions on the basis that it was not a fair deal as it even flouted procurement regulations.
Justice Webster Chinamora, in his judgment issued on Monday 7 November 2019, concurred with the applicant in the case and criticized strongly the Marume led ZIMDEF for violating procurement regulations.
The ZIMDEF contract awarded to Tono Digital Solutions was under reference number ZPCR33-2022 while the High Court urgent chamber application was under case number 1737/22.
Advocate Method Ndlovu, who was instructed by Dube, Manikai and Hwacha law firm to argue the matter, said the case was brought before the courts after his client Twenty Third Century noted the anomaly in the way the tender was drafted by ZIMDEF.
“Our client went to court seeking an order that declares a procurement process that was initiated by Zimdef to be declared a nullity as the tender requirements were clearly in contravention of section 28 of the Procurement Act.”
“Zimdef inserted a condition to the effect that all bidders must be holders of what is called a SAP partnership license. This condition was meant to favour certain players at the exclusion of the others. The court agreed,” he said.
In his lengthy written judgement, Justice Chinamora explained that the awarding of the contract broke the law.
He noted that it was wrong for Zimdef and PRAZ to have continued with the awarding of the contract to Tono when Twenty Third Century (Pvt) Limited had actually sought a court order to stop the process before and won it.
“The procurement process initiated by the first respondent who administers the Zimbabwe Manpower Development Fund under reference Domestic ZPCR 33-2022 be and is hereby cancelled and nullified.”
“The first respondent shall pay costs of this application on a legal practitioner and client scale,” said Justice Chinamora at the end of his judgement.
The first responded was the Minister of Higher and Tertiary Education Professor Amon Murwira on the technical basis that he is the Zimdef trustee but the mess in essence was caused by the latter’s CEO, Marume.
As minister, Murwira does not oversee day to day running of Zimdef.
Advocate Ndlovu confirmed that the prices had been inflated in the contract that was awarded by Zimdef looking at the work that was supposed to be done but said he did not have actual figures that matched the job.
“If you look at the narture of the work that was required. You will see that there was a problem (of inflating price.) This was on a higher side. What must be emphasized is the role of public procurement in moving the agenda and economy of this nation.”
“Public procurement is the backbone of the country. Once public procurement is put to question because of behavior of a certain person, then that person is in a way destroying the whole nation,” he said.
Online checks found out that prices of SAP software installation and maintenance are relatively lower than what was quoted by ZIMDEF.
According to Seidor, a digital company that specializes on the software, it costs between US$1 000 to US$3 000 once off to install it for purposes of financial management, business intelligence, analytics and inventory control.
The company offers three SAP Business One Pricing tiers.
The professional package costs US$3, 213, Limited package US$1, 666 and Starter package US$1, 357.
The prices are according to an article posted on the company’s website on 1 June 2022 titled “2022 SAP Business One Pricing”.
“If you have been looking for information on SAP Business One Pricing, you have come to the right place.
“We have compiled the most comprehensive guide on SAP Business One licensing and pricing options to make things easy.
“With this information, you can negotiate an SAP Business One license contract that could save you thousands,” reads part of the article.
“The price for SAP Business One varies based on many factors, such as the number and type of licenses, payment frequency, and editions. SAP Business One pricing options are explained in detail below…”
Last month President Emmerson Mnangagwa said he was alarmed by incidences of non-compliance and wanton pricing which have brought “untold commotion in the procurement sector.”
He was speaking at a conference in Harare attended by procurement officers from government departments and other public entities among other stakeholders.
Said Mnangagwa:
“Regrettably, my office continues to be inundated with negative reports on incidences of corruption, malpractices, opportunism, connivance and use of the procurement system as a conduit to siphon public resources for personal gain and enrichment of cliques.”
“Over and above this, issues around contestation in the award of bids are hampering implementation of critical Government programmes and projects.
“Due to interference and unfair treatment of bidders, Government is losing precious productive time and financial resources as a result of litigations.”
“This conduct by procuring entities, which goes against the very tenets of the Second Republic, will not be tolerated.”
“My Government is, therefore, cracking the whip on those who are bent on abusing public procurement processes, thereby frustrating and delaying Government programmes and projects.”
“The gazetting of the Public Procurement and Disposal of Public Assets (Compliance, Monitoring and Evaluation) Regulations is being accelerated.
“These Regulations will introduce administrative penalties against those public entities and individuals that are committing administrative misdemeanours with respect to the Public Procurement and Disposal of Public Assets Act.”
In the last few months, Parliament of Zimbabwe also torched a storm when it was discovered that it had cleared a contract of purchasing laptops at US$ 9 000.
The amount it was later found out, could actually buy three laptops with the same specifications on the market.
There was also a similar other dubious contract awarded government that would have seen Harare City Council forking out US$22 000 per day or US$8 million annually to dump its waste at the Pomona dumpsite.
Harare East legislator Tendai Biti this week put to task Local government minister July Moyo and demanded to know why government, notwithstanding that City of Harare cancelled the agreement with German investor Geogenix BV, continues to pay the US$22 000 per day fee.
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