THE Parliamentary Portfolio Committee Mines and Mining Development queried the existence of the Zimbabwe Consolidated Diamond Company (ZCDC) as a state-controlled entity during a hearing on its controversy-laden operations Monday.
The committee members argued that ZCDC’s existence was confusing as it was not a parastatal because its formation was made through a Companies Act and not an act of Parliament.
ZCDC was formed following the March 2015 Government decision to consolidate all diamond mining companies in Zimbabwe to form a wholly owned government company.
The arguments started after ZCDC chief executive officer Mark Mabhudhu described it “an entity formed through the ministry of Mines and Mining Development and wholly owned by government of Zimbabwe.”
However, Zanu PF Uzumba-Maramba-Pfungwe legislator Simbaneuta Mudarikwa sought an explanation over how it was created from the ZCDC management.
“Can you explain to us how you were created. Were you created by an Act of Parliament or through a Statutory lnstrument(SI)?” said Mudarikwa.
Mabhudhu told the committee that it was a creation of the Companies Act and not an act of Parliament as required for all state enterprises.
An unsatisfied Mudarikwa then said: “Basically, this means that ZCDC is not a government institution. All government companies are created through an Act of Parliament or if it was created through Zimbabwe Mining Diamond Company (ZMDC) which they used to tell us, there must be board minutes to confirm this company was created through ZMDC. So as they stand now, this is an illegal institution which is not supposed to be there.”
“There is no provision in the Act where a ministry forms a company and put officers from the ministry to run it and call it a government institution.”
an overwhelmed Mabhudhu referred members of the committee to the Mines ministry saying: “It is inappropriate for me to dwell in that area as my role is to run the operations of the company and make money for the organisation. In accordance to corporate governance, management may not have a legal standing to deal with these questions. We may escalate the matter to the parent ministry so that we get the facts correct.”
But MPs could have none of it as they kept demanding answers, with Zaka Central MP Davison Svuure immediately chipping in with demands for a clear answer on the issue.
“Before we go deep with the discussion, are we dealing with a legal entity? That part needs to be clarified otherwise we will be discussing something that has no premise.”
Zanu PF Magunje MP Cecil Kashiri also said the committee needed to know and understand whether ZCDC was a private or public organisation so that it could move on with the hearing of the meeting.
At one point, Mabhudhu admitted after Mudarikwa’s request for an answer regarding the court judgment where companies which were banned from mining diamonds in Marange successfully challenged the formation of ZCDC.
He revealed that one such companyy, Mbada Diamonds contested the consolidation winning the case.
The ZCDC was established as a merger of DTZ-OZGEO, Marange Resources, Kusena Diamonds, Diamond Mining Company and Gye Nyame, when Anjin and several other diamond miners were de-licensed by the government and barred from operating in Marange, in Manicaland province, for alleged impropriety.