HomeLocal NewsZesa prepaid tender scandal deepens

Zesa prepaid tender scandal deepens

LOCAL information communication technology company Aura Group has taken the corruption scandal over Zesa’s prepaid energy tokens to parliament. This comes amid indications that the firm is also considering seeking recourse from the Administrative Court, it has been established.

By Bernard Mpofu/Elias Mambo

Latest details show that former Energy minister Dzikamai Mavhaire and permanent secretary Pattison Mbiriri were influential in irregularly awarding the tender to companies that were initially disqualified during the bidding process.

While a Parliamentary portfolio committee on Mines and Energy is still to finalise investigations into the matter, Aura has told the committee that it had been treated unfairly during the corrupt tender process.

Internet service provider PowerTel, a Zesa subsidiary, was in 2014 appointed as the sole aggregator for the sale of prepaid electricity tokens after the State Procurement Board (SPB) twice cancelled the tender citing technical irregularities. Questions are being asked about PowerTel’s capacity to run the system given the frequent downtimes inconveniencing consumers.

Zimbabwe is in the grips of perennial electricity shortages due to the diminished generating capacity of its ageing plants and lack of investment in new infrastructure.

The country currently generates half of its 2 200 megawatt peak demand. The introduction of prepaid electricity platforms is an important demand-side management measure meant to guarantee revenue streams as users pay for power in advance, while also managing their consumption better. The appointment riled some of the 37 companies that had tendered for the job and have approached government seeking to have the process re-tendered. The tender was initially advertised in August 2012, but was cancelled before the closing date of submission. It was then re-issued in September 2013, but the SPB announced the cancellation on January 2014, while the Ministry of Energy and Power Development appointed PowerTel soon after.

Documents seen by the Zimbabwe Independent this week show Aura, which participated in the tender for the appointment of aggregators for the sale of ZETDC prepaid units (ZETDC/HO 04/2013), on several occasions engaged government, raising several irregularities in the tender process.

The the tender was cancelled 2014 before the winning company had been announced, with the letters only being given to the bidders on January 7 2014. The SPB, documents show, then called a meeting on January 13 with prospective bidders at which it advised that government had instructed them to cancel the tender due to technical irregularities.

After PowerTel and its technical partner, E-Solutions, were awarded the tender despite the technical irregularities, Aura wrote to the Ministry of Energy on February 3, 2014 seeking to be appointed as an aggregator of prepaid electricity tokens in the same manner that PowerTel had been appointed. The group cited slower implementation of policies, service inefficiencies affecting the entire population of customers and higher costs of transacting as one of their reasons for appealing.

Mbiriri, in a letter dated February 6 2014, rebuffed Aura, informing them to “respect the decision of government.”
After Aura kept on pressing, Mbiriri wrote another letter dated July 8, 2015 to Aura’s business development director, Samuelle Dimairho, saying: “The matter has dragged on for a long time and you continue to raise it in the face of fundamental decisions which government took. Allow me to restate the fact that PowerTel is part of the Zesa Group.

PowerTel’s reason for existence is essentially to service the Zesa Group in terms of providing ICT solutions.

“Granted, PowerTel markets its excess capacity to all and sundry. This does not take away its primary role. This ministry disputes that PowerTel’s primary role and mandate in providing an aggregator service to ZETDC should have been subjected to procurement processes and procedures. Accordingly, we would urge the Aura Group to accept this reality and not continue flogging this issue.”

Aura then attempted to file an appeal through the Administrative Court, but was out of time after it initially resolved to engage government. Following this standoff, then wrote to Parliament on July 22, 2015 seeking its intervention on this matter.

On this same day, Aura also wrote to the SPB, advising them of some of the glaring irregularities regarding the current arrangement between ZETDC and PowerTel.

The company eventually appeared before the parliamentary portfolio committee on energy on April 26, 2016.

“We noted that PowerTel was unilaterally appointed by the Ministry of Power Development to be the aggregator of ZETDC prepaid electricity tokens at the beginning of February 2014. The actions taken by the Ministry of Energy and Power Development in respect of the due procurement processes and subsequent appointment of PowerTel as a sole aggregator were done in a manner that is in violation of Procurement Regulations (Statutory Instruments 160/2012 and 171/2002), the Procurement Act 22:14 and section 195 of the Constitution of Zimbabwe. In that regard, the current vending service in operation is illegal,” Dimairho told the parliamentary portfolio committee.

“In addition, it is important to note that PowerTel floated an informal tender number INF/PWT/36/2013 for the provision of E-vending and M-commerce solutions, which has the following irregularities surrounding it: the tender was open for a period of 10 calendar days from 13 September 2013 to 23 September 2013, despite procurement regulations that require a thirty (30) day period for informal tenders to be open for bids …

“Given that PowerTel is using the system from E Solutions for service delivery in respect of ZETDC prepaid electricity tokens vending, it is obvious that the E-Solutions would exceed the informal tender contract value limit of US$300 000 at the time of the tender’s issuance.”

Committee chairperson Daniel Shumba could not be reached for comment as his phone went unanswered.

Alarm was also raised over the participation in the tender of Revma, which was also part of the adjudicators.

PowerTel had also applied for the tender, and its award means that it will handle the pre-paid electricity tokens for the Zimbabwe Electricity Transmission and Distribution Company (ZETDC), another Zesa subsidiary. Aura previously dismissed statements issued by Zesa, saying Mavhaire was appointed Energy minister before E-Solutions was given the contract to provide an e-vending platform to PowerTel.

“Interestingly enough, Dzikamai Mavhaire was appointed cabinet minister on September 2013 which was before ZETDC and PowerTel tenders had been floated,” Dimairho said.

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