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Serious Trouble Ahead

Source: pointblanknews.com
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-    By Bashorun JK Randle, OFR, FCA
While the debate rages as to whether Pope Francis I should honour the invitation to visit Nigeria, matters took a completely different turn with the trenchant plea from our South African brothers and sisters to the Vatican that the spiritual cleansing of Africa should start at the southernmost tip – South Africa.

The essence of their petition was captured on CNN's “Inside Africa” programme anchored by Aisha Sesay last Sunday.

At a press conference in Pretoria, the capital of South Africa, Ms Thuli Madonsela, the ombudsman and feisty corruption fighter accused President Jacob Zuma of benefitting unduly from using state money to carry out lavish improvement to his rural residence in Nkandla at the cost of 246 million rand (US $23 million/£stg 13.8 million).

The original estimate for the work in 2009 was about 27 million rand and the ombudsman launched her investigation in 2012 when it was reported by the “Seventy senior elders”, who had been protesting against the over domination of the accounting profession by “The Big Four” firms of international accountants, that 206 million rand had been spent.

According to Ms Mandonsela the president tacitly accepted the implementation of all the measures at his residence and has unduly benefitted from the enormous capital investment in the non-security installations (e.g. Olympic size swimming pool for six wives) at his private residence.

She gave President Jacob Zuma fourteen days to respond to her report before parliament.

However, Zuma's accountants agreed that some of these measures (improvements) can be legitimately classified as unlawful and the acts constitute improper conduct and maladministration.  An unrepentant Zuma had consistently and repeatedly told parliament that he used his own family funds to build his homestead in Nkanda in the province of KwaZulu-Natal where he comes from.  To make matters worse his accountants and lawyers swore to an affidavit that while it could be “legitimately construed” that President Zuma had misled parliament over the extravagant renovations, nevertheless it was a “bona fide mistake”!!

Ms Madonsela held her ground and remained adamant that the expenses on private property were unethical.  They included cattle enclosure, swimming pool and fitness centre to enable the president to cope with six wives.  In her recommendation to parliament she said that the president should refund the cost of unnecessary renovations.  It has turned into a major political scandal and controversy as Zuma faces re-election this May.  However, he is relying on a government probe which last December cleared him of any wrongdoing and claimed that the improvements were needed for security reasons.

Last December, a massive global audience watched in utter disbelief and agonizing embarrassment when President Zuma who has been in office since 2009 was booed at the memorial service for Nelson Mandela, South Africa's first black president.

The Vatican “refusniks” over the Pope's visit to Nigeria insist that Africa is a “Black Hole” with trouble everywhere – Ethiopia; Somalia; Liberia; Congo Brazzaville; Democratic Republic of the Congo; Sierra Leone; Libya; Mali; Uganda; Central African Republic etc.

Ahead of the World Bank/International Monetary Fund spring meeting in Washington DC, World Bank President Dr Jim Yong Kim on CNN classified Nigerians and Indians among the poorest in the world.

According to him, two-thirds of the world's extreme poor are concentrated in just five countries –

o    India
o    China
o    Nigeria
o    Bangladesh; and
o    The Democratic Republic of the Congo
The World Bank has shared its template with Nigeria's National Office of Statics which is headed by the Statistician-General of the Federation, Dr Yemi Kale.  They both measure poverty by using the one-dollar-a-day benchmark.  However, the United Nations under Bank Ki-Moon and United Nations Development Programme which is headed by Helen Clark quantify “extreme poverty” by access to the basics of life – sanitation, food, shelter, healthcare, education and water.

According to Africa's detractors, even Malawi which under its new female President Joyce Banda offered a glimmer of hope has crumbled at the altar of corruption and scandal.  Indeed, it was Michael Nevins, the British High Commissioner to Malawi who let the cat out of the bag.  He blew the whistle on BBC:

“We want the government of Malawi to put its house in order by implementing financial systems that will not allow pilferage of public funds.  In the meantime Britain will withhold £stg 17 million of aid.”

On Al Jazeera television, Henry Chingaipe a Cambridge-educated expert in corporate and civil governance spoke from Malawi:

“This did not come as a surprise to many of us.  The donors simply lost themselves in singing Banda's praises.  We were somewhat intrigued watching donor countries falling over themselves to provide aid despite glaring evidence that a large chunk of it was being siphoned off by corrupt officials.”

For much of this year Malawi has been embroiled in a slew of financial scandals.  Relatively junior civil servants and clerks were found with huge stacks of cash in their kitchen, cupboards, pillowcases, handbags and even under their hats!!  The more daring and reckless ones splashed out on state of the art cars as well as super mansions to “dryclean” (or launder) stolen money.

This has prompted Britain and other donors to withhold US $150 million (£stg 90 million) to Malawi pending the conclusion of a forensic audit for which a UK firm has been engaged.

The irony and paradox of it all is that Malawi which is one of the world's poorest nations made a vigorous effort to clean up its act when Joyce Banda became its president two years ago.  In her inaugural speech, she announced to a widely cheering audience that she had sold her predecessor's £stg 9 million private jet as well as fleet of 100 super luxury limousines and armoured cars.

The crowd went wild when she declared:
“We are a poor nation.  Malawi will no longer be used as a piggy bank by kleptocrats who are addicted to plundering the coffers of the state.  It is common knowledge that we rely on donor agencies for about 45 per cent of our budget.”

To the consternation of even her own most ardent supporters, Joyce Banda was recently filmed flying on the private jet which she claimed had been sold.  African magic!!

Recently, about seventy civil servants together with the usual suspects – businessman and politicians went on trial for deducting almost £stg 100 million “at source” (from the treasury!!).  Indeed, a minor civil servant was found with US $300,000 in the dashboard of his car.

Inevitably, the sordid scandal has galvanized media frenzy both locally and internationally.  It has been tagged “Cashgate” and owes its genesis to gunmen who attempted to assassinate Paul Mphiwiyo who is the Budget Director as well as being a very close ally and confidant of Joyce Banda.  Six bullets were fired by the gunmen and each bullet triggered off speculation that the voice may have been that of Esau but the hand was that of Jacob Ralph Kasambara, the former minister of justice.  How strange that a whole minister of justice should resort to self-help.  Anyway, he has been charged with attempted murder as well as “drycleaning” and money laundering.  The World Bank and IMR estimate that 35 per cent of the budget simply vamoosed during 2004 to 2014.  It is almost exactly equal to what Malawi received from donors during the same period.

Even though Fahad Assani who is the new Minister of Justice (after the exit of Kasambara) has told Fox News and Reuters that the arrest of a “big fish” is imminent, Joyce Banda is seeking re-election this May.  She appears determined to bluff her way through regardless of the scandal.  However, the money that has disappeared keeps getting bigger and bigger.  A top government official confessed that she bought ten luxury buses valued at US $2 million illegally while one of Banda's party chieftains has admitted using ghost companies to divert more than US $10 million of government funds.

Following the recent arrest of Joyce Banda's senior finance officer in connection with “Cashgate” scandal, lurid stories in the local press have not only linked other officials in the President's office with looting of state funds, they have hinted that Banda herself was a beneficiary of the plunder and brigandage.

The damage to her reputation has been monumental particularly in Britain which is her largest donor.   Indeed, several UK newspapers have published editorials warning that the scandal calls into question Banda's determination to fight corruption and she herself could be damaged beyond redemption.

Perhaps that is what prompted Joyce Banda to sack not only the disgraced Minister of Justice but the entire cabinet.

However, the World Bank was somewhat miffed when on CNN she blamed the scandal on a loophole in an electronic accounting system which was installed by the World Bank.  According to her, it was the loophole that was massively abused by unrepentant corrupt government officials.

As for Zimbabwe, President Robert Mugabe is having a swell of a time.  His 90th birthday party was truly spectacular.  No expense was spared.  He made it very clear that he had no intention whatever to surrender power.  His pact with the war veterans is sacrosanct – they fought for independence and they are entitled to the spoils of victory.  The sharing of the booty must accord due recognition to the real fighters.  The inheritors (or those who want to inherit) must wait their turn.

When President Mugabe rose to speak at his birthday party, the first half was devoted to mocking Nigeria.  He had forgotten how much aid and other resources Nigeria committed to the struggle in Zimbabwe (previously Southern Rhodesia).  Then he tore into his arch rival and erstwhile Prime Minister, Morgan Tsvangira.

He quoted a string of lurid revelations about the alleged romantic escapades and sexual excesses of the leader of the opposition.  It was with considerable glee and unrestrained relish that he reminded his guests that the press had published stories that the leader of the opposition had impregnated the sister of his dead wife.

Bashorun J.K. Randle is
Chairman & Chief Executive
JK Randle Professional Services
Chartered Accountants
“X KPMG HOUSE”
One King Ologunkutere Street
Park View
Ikoyi
(opposite Astoria Hotel)
E-mail:  [email protected]