Procurement regulators have blocked Harare City Council (HCC)’s push to acquire a US$2,8 million billing system through a condonation process, after slamming city bosses for violating laws and exposing public funds to litigation, Truth Diggers can reveal.
Confidential documents detailing HCC’s latest attempt to find an Enterprise Resource Planning (ERP) system showed the tender submitted last month was way cheaper than a US$57 million proposal earlier rejected by the Procurement Regulatory Authority of Zimbabwe (Praz).
Pressed to explain the US$54 million difference, Harare mayor Jacob Mafume said this week HCC’s latest submission was the cheaper option.
“The one which is reduced is the cheaper option for BIQ,” Mafume said. BIQ is a billing technology.
Truth Diggers understands Praz was shocked by glaring violations in the document that it had to ask HCC executives to approach government for procurement insights. The tender related to Harare’s plan to re–engage South Africa based Quill Associates to supply BIQ.
Truth Diggers understands HCC’s papers were presented following high level meetings in July where Harare asked to weave around legal hurdles through condonation.
HCC argued during the meetings that Praz’s Special Procurement Oversight Committee (SPOC) had already agreed to the acquisition.
If the transaction had sailed through, it would be the second time Quill worked with Harare.
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The firm walked out of a similar deal in 2019, following a dispute over pricing.
But Praz's stance means Harare will have to submit a new plan, which the capital desperately needs to combat a looting scourge that has flourished since Quill's ERP (billing system) was switched off.
Over US$1 billion is estimated to have been salted away by corrupt officials since Harare abandoned the ERP and reverted to manual accounting, according to Parliament.
Under the deal, Harare undertook to pay a U$1 449 000 once off installation fee to Quill. The project would commence after HCC signed 'an acceptable' contract and paid US$362 250, which was 25% of the license fee.
Harare was also expected to shell US$1 082 600 for selected modules of the technology, and an additional US$125 000 for an e-payments gateway platform.
About US$150 000 would be paid to purchase an IBM server and 45 installation hours. Combined, the city would pay about US$2,8 million to Quill, according to Truth Diggers’ calculations.
But Clever Ruswa, chief executive officer at Praz, poked holes into the deal, citing at least five areas in which Harare violated the Public Procurement and Disposal of Public Assets Act (PPDPA).
"The authority (Praz) observed that the accounting officer (HCC acting town clerk Phakamile Mabhena Moyo) was requesting for condonation for entering into a licence and service level agreement for the re-engagement of Quill Associates for the implementation of the BIQ ERP system for the City of Harare without prior review by the SPOC in violation of Section 54 of the Public Procurement and Disposal of Public Assets Act, Ruswa wrote to Moyo on September 3.
“The accounting officer signed an ‘especially valuable’ contract without prior review by the SPOC in violation of Section 54 of the PPDPA Act…the violation constitutes an offence under Section 94 of the PPDPA. There was no attempt by the accounting officer to follow procurement procedures, contrary to the accounting officer’s claim that the City of Harare had complied with SPOC recommendation Resolution 0926B of 22 February 2024.
“Quill Associates was engaged using the direct procurement method contrary to the accounting officer’s annual procurement plan approved on May 4 2024… which shows that the approved procurement method by the authority was competitive bidding method. The violation constitutes an offence under Section 94 of the PPDPA,” Ruswa said.
Quill has participated in an open tender floated before HCC’s latest decision. However, the tender was cancelled after Harare said none of the bidders met its basic requirements.
Ruswa argued that by choosing Quill, city bosses had exposed Harare to legal action.
“The preferred bidder, Quill Associates was also a participant in the cancelled tender processes where the bidder had failed to meet tender requirements,” he said.
“The direct engagement of Quill for five years will be a source of potential appeals by other losing bidders who would want to know why they were abandoned in the open and transparent race in favour of Quill Associates. This would not meet the objectives of public procurement as required under Section 4 of the PPDPA Act,” Ruswa argued.
“Accordingly, the authority, in view of the above findings and in terms of Section 98 of the PPDPA Act, hereby annuls the procurement proceedings for the re – engagement of Quill Associates for the implementation of the BIQ ERP system for the City of Harare. This is due to defects in the procurement proceedings which do not result in the achievement of public procurement objectives stated under Section 4 of the PPDPA Act and render the procurement contract void in terms of Section 32 of the PPDPA general regulations,” Ruswa added.
The deal was expected to run until 2029.
But Truth Diggers heard that the deal was already under the radar of the rejected bidders, who were threatening legal action.
In an interview with Truth Diggers recently, Mafume admitted that looting syndicates, capitalising on the manual system, had captured the capital, pillaging cemeteries accounts, properties and other revenues sources.
But this week, he said HCC would continue engagements with Praz to find a solution.
“We are in discussions to relaunch the application (BIQ),” Mafume told Truth Diggers.
“I think sooner or later Praz will realise that its approach is destroying Harare and the economy just because of some greediness of some of the people at Praz. It is tragic that they reject that approach,” he noted
Harare has to move with speed to tackle he problems before an ongoing probe ends. The probe is expected to end with high-profile arrests and expulsions.
Town clerk, Hosia Chipanga is already in remand prison after being accused of improperly signing a deal.
The pushback by Praz could have implications in the outcome of the probe, which has already exposed shocking looting evidence by councillors and city bosses.
Ruswa’s response is likely to enlist more backlashes from Mafume, who has previously fired the broadside at 'Praz cartels', saying they were frustrating Harare's plans.
Last month, the Independent quoted Mafume saying Harare bosses had plundered far bigger amounts than a US$200 million black-hole uncovered by state auditors in 2022, as a result of the BIQ’s removal.
Mafume also confessed in a confidential meeting with Praz that looting had increased since the BIQ was removed.
Truth Diggers has a recording of the meeting, where Praz bosses pressed Mafume to divulge details of the US$57 million proposal.
