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Zanu PF sinks deeper into debt

THE ruling Zanu PF party continues to sink deeper into debt, with a central committee report released this week which reviewed the party’s performance between 2014 and 2015 revealing its liabilities have ballooned to more than US$15 million, while expenditure is at 195% of revenue.

Staff Writer

The party’s fundraising activities flopped, with only US$1 954 372 raised from such efforts. The party’s financial mess reflects the state of government finances.

In 2013 the party’s expenditure stood at US$9 million against an income of US$4,4 million, while liabilities for that year totalled US$5,8 million. By 2014 the party owed creditors over US$11 million as debts and other financial woes continued to mount for the ruling party that is torn apart by factional fights as the race to succeed President Robert Mugabe hots up.

The report also says that Zanu PF received a government grant of US$2 297 658.

“The party is heavily relying on a government grant (49,9%) and fundraising (42,4%) that jointly account for 92,3% of the budget. There is thus need to raise the contribution of other sources,” reads the report. “Expenditure at 194,6% of the revenue is unsustainably high; there is need to effectively manage staff salaries, telephone and internet as well as bank charges and interest.”

The party’s total revenue was US$4 606 912. However, its total expenditure amounted to US$8 964 897 and liabilities which include bank loans, bank overdrafts and accrued telephone charges which in total stand at US$15 million.

The report notes that the party’s financial position is “unsatisfactory”.

“There is need to explore strategies to grow the revenue base, to this end, intensifying the distribution and sales of membership cards as well as transforming M&S Syndicate (Pvt) Ltd (Zanu PF’s investment company) into a well-managed corporate,” the report says.
“Effective cost-management strategies should be employed particularly in view of (a) relatively high salaries bill and interest burden.”
However, last year in the run-up to the Zanu PF congress there were reports Zanu PF party memberships cards worth about US$400 000 could not be accounted for from provinces, raising fears the money could have been misappropriated.

The commissariat department under former political commissar Webster Shamu had reportedly disbursed 1 274 320 cards since 2009, but as at September 2014, about 400 000 were yet to be accounted for.

Zanu PF is largely surviving on taxpayers’ funds which it gets through its allocation under the Political Parties Finance Act which provides for financing of local parties and prohibits foreign funding.

In the 2015 national budget, Finance minister Patrick Chinamasa allocated US$3 million to be proportionally shared by political parties which secured at least 5% of the total votes cast during the last elections in 2013.

After winning a number of by-elections in June, Zanu PF guaranteed itself the lion’s share due to its numerical superiority in parliament.

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