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Friday, 17 September 2010

A Parastatal Horror Show (Mulungushi University)

I was rather surprised to see the funding structure for Mulungushi University set out in the latest Auditor General (AG) report. When the university was created by President Mwanawasa it was announced that this was going to be a great model for public private funding (PPP) of the university education. The government burden was going to be limited and much of the funding was going to come from the private sector, with Konkola Copper Mines (KCM) named as a major contributor. A quick look at the funding sources for Mulungushi in the report reveals a different picture. Government funding in 2008 was 75% (K44bn). KCM contributed a mediocre 6%.  Its not that I expect KCM to fund these institutions, I am just baffled by the spinning machine. At the time this was hailed as a great form of corporate responsibility, which it clearly isn't.

The larger government funding undoubtedly explains why it suffers from the many problems we have seen in other parastatals. We have the customary lack of preparing financial statements : "contrary to the University Act, the accounts for the financial year ended 31st December 2008 were not ready as at 31st December 2009". Perhaps not too surprising considering those in position hold the position illegally (as in contrary to the Laws of Zambia) :
Contrary to the provisions of the University Act, which requires the Minister to constitute a search committee to advertise and select the Vice Chancellor and Deputy Vice Chancellor, a search committee was not constituted. In response, management stated that the appointment of the Vice Chancellor and the Deputy Vice Chancellor did not strictly comply with the provisions of the University Act because it was a new University and their appointment preceded that of the Council and that the Chairman of the Council had since written to the Minister of Education requesting him to appoint a Search Committee for the formal appointment of Vice Chancellor and Deputy Vice Chancellor.
Where you have irregular appointments you will also see irregularities in financial matters (no honourable man occupies a position illegally). We find self enrichment :
A review of records revealed that in 2008 additional furniture valued at K26,699,000 and K66,963,000 was procured for the residence of the Vice Chancellor and registrar of the University respectively. This was contrary to their conditions of service which did not provide for a fully furnished accommodation....

In the first year of operation of the University, all employees were given one year contracts. A review of the contracts of employment revealed that officers were only entitled to repatriation in the event that the contract was not renewed. However contrary to the clause in the contracts, repatriation allowances in amounts totalling K462,000,000 were paid to ninety seven (97) employees who had their contracts renewed.
These of course are in addition to the usual triad of unvouched expenditure (K1.8bn); unretired imprest (K0.3bn) and failure to follow tender procedures in expenditure worth K1.0bn.   As we go through this I hope readers are beginning to appreciate that our poverty is self inflicted. There's money leaking through the system with every parastatal / agency. When will the rot stop? What worries me is that this is an educational institution. We shall meet the other educational culprits (UNZA, etc) in due course. 

Next Stop : National Airport Corporation Limited

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