HomeLocal NewsPsmas, govt on collision course

Psmas, govt on collision course

PREMIER Service Medical Aid Society (Psmas) members in May approved a raft of changes to the society’s constitution, chief among them being the reduction of government’s seats on the board of directors from six members to three, consequently terminating authorities’ controlling power, the Zimbabwe Independent has learnt.

Hazel Ndebele

This comes amid a looming collision between Public Service, Labour and Social Welfare minister Prisca Mupfumira and Psmas members as the minister has shown keen interest in controlling the medical aid society, most of whose members are civil servants.


This week Mupfumira told MPs attending a pre-budget seminar that government was going to investigate how the Psmas constitution was changed as it withdrew government’s power to control its activities. However, Psmas members who spoke to this paper say that there is no law or instrument that gives Mupfumira powers to control the institution in any way.

Information gathered by this paper shows that a number of amendments to the Psmas constitution were effected at a special meeting held in May at the Rainbow Towers in the capital. Documents in our possession bear proof that the special meeting approved that the six government seats were to be shared equally between the employer and the employees (civil servants). Traditionally, the employer has been represented on the Psmas board by members drawn from the Public Service Commission and the Public Service and Finance ministries.

In the previous board led by former chief executive Cuthbert Dube government’s involvement cost the institution a fortune as some cabinet ministers and senior staffers benefitted financially under unclear circumstances, in the long run adversely affecting operations.

A forensic audit draft report on the utilisation of Psmas funds dated February 20 2015, carried out by Ernst and Young, reveals looting at the medical aid society while members were failing to access medical care services and Psmas employees were not receiving salaries.

Finance minister Patrick Chinamasa this week said government had no legal right to hire or fire management at Psmas since it was not a parastatal, and that it would not interfere in Psmas’ problems as the institution was not a government department.

Although Mupfumira said her interest in the medical aid society is due to the fact that more than 80% of subscribers are from the civil service, Psmas bosses claim that Mupfumira wants to control Psmas for personal gain.

“Our interest as a ministry in particular is because more than 80% of subscribers are from civil service. If we remove civil servants that organisation will collapse overnight,” Mupfumira said.

According to the adverse report of the Parliamentary Legal Committee on Statutory Instrument 77 of 2015, Psmas is a private company controlled by a board of directors.

“Medical aid societies are regulated by Statutory Instrument 330 of 2000 which regulations are administered by the Minister of Health and Child Care and is also responsible for issuance and renewal of operating licences to all medical aid societies,” reads the report. “Government only contributes about 80% to Psmas through subscriptions of its employees, but that does not make it a parastatal and as such the provisions of the State Liabilities Act cannot be applicable to Psmas. Furthermore, liability upon the state must be as a result of the acts of its employees of which the employees of Psmas are not part of the civil service.”

Another constitutional amendment made at the special meeting by Psmas members is the addition of the new subsection which will read: “In keeping with good corporate governance principles, the board shall finally be responsible for assessing, vetting and recommending suitable candidates for board directorship,” the report says.

In a move that raised eyebrows a fortnight ago, Health minister David Parirenyatwa and Mupfumira, in a joint statement, reinstated suspended Psmas managing director Henry Mandishona, directing him to resume duty while a neutral arbiter is appointed to look at the issues raised by both the society’s board and the managing director in the dispute that led to his suspension.

However, the decision was reversed, with Psmas board chairman Jeremiah Bvirindi in a statement saying: “For the avoidance of doubt, Mandishona shall remain on suspension under the same terms and conditions as contained in the board chairman’s letter to him dated 4 September 2015 until the disciplinary proceedings are brought to finality.”

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