Monday, April 22, 2013

Board's claims are nonsense - Chirwa
By Allan Mulenga and Gift Chanda
Mon 22 Apr. 2013, 14:00 CAT

PROFESSOR Clive Chirwa yesterday dismissed as nonsense the dissolved Zambia Railways Limited board members' claims that he wanted to live a lavish lifestyle and was making corrupt undertakings.

And government has dissolved the Zambia Railways Limited board with immediate effect. But dissolved board chairperson Mark Chona hoped investigative wings would move in to investigate allegations the board levelled against Prof Chirwa.

In an interview yesterday, Prof Chirwa, who is Zambia Railways Limited (ZRL) chief executive officer, explained that he differed with the board members because he was opposed to misuse of company funds through unnecessary board meetings.

"Dissolved board members' claims are nonsense. What happened was that at the beginning, when I came from United Kingdom to take up this position, yes, I had a letter which I brought with from my lawyers to negotiate my contract. And that negotiation was carried out and that was the end," he said.

"There was nothing which I was claiming apart from what I was claiming at the beginning when the negotiations began. That was concluded and I am not claiming any more. We went into negotiations like any other CEO going into a contract, and that is all I did."

Prof Chirwa said board members had been getting unnecessary sitting allowances through unplanned board meetings.

"There were differences because I stopped the misuse of company money to actually have board meetings which are unnecessary in order to get sitting allowances…if somebody goes to see the minister or to see the PS (permanent secretary) and claim sitting allowances, that was nonsense. That is what led to that (differences)," he said.

"We had 28 meetings in total and it has accumulated to KR470,000 instead of spending, for this quarter, KR58,000, which is actually the money we are supposed to spend. Remember that we haven't had the meeting itself which is a scheduled board meeting which is on April 30, 2013. Per sitting, it is KR3,000 for the chairperson and KR2,600 for board members. When I stopped this, things started going bad."

Prof Chirwa explained that board members used to claim allowances whenever they called for a meeting with the permanent secretary and the minister.

He said allowances were necessary if someone had done some work.
"But if somebody wants to go and see the minister or the PS and claim sitting allowance, that is unacceptable," he said.

Prof Chirwa said it was shocking that Zambians had a culture of demanding unnecessary allowances.

"I am very surprised that people in Zambia have got this attitude of getting allowances. This thing should come to an end," he said.

"Perhaps this story of Zambia Railways will bring up some sanity within the allowance culture where without doing anything, you get allowances. This should be stopped once and for all."

Prof Chirwa said he was shaken about the manner in which former board members executed their functions.

"In fact, I am totally shaken. This is something that does not exist in Europe. If somebody is running a company, like a CEO, he is the one running a company, not the board chairperson who is non-executive. I am really surprised, very surprised," said Prof Chirwa.

On the shifting of ZRL headquarters from Kabwe to Lusaka, Prof Chirwa said it was not his proposal but it was a decision made by the previous administration.

"When I came to take up this position, I found that RSZ (Railway Systems of Zambia) headquarters offices were here in Lusaka. It is actually the board that proposed that we should actually move here. We just maintained the decision which was done by the board we inherited from the previous administration," he said.

On his stay at Fallsway Luxury Apartment, Prof Chirwa said it was not his intention to stay there, but it was management's decision.

"I am not the only one who is staying at the apartment, even some government officials stay there," he said.

On the claims that he had appointed himself board chair of the tender committee of ZRL, Prof Chirwa said it was procedural that the chief executive officer of the company assumed the position of the chairperson of the tender committee.

On the allegation that it rejected his demand of US$560,000 annual salary (or K248 million per month) and a 25 per cent shareholding in ZRL at the end of his five-year contract, Prof Chirwa said it was common practice and part of his contract.

Prof Chirwa also said the board was dissolved because some of the board members were unproductive.

"They have been holding meetings and meetings. They want to start throwing dirt at me. All these things are documented. I came here to do my work. I didn't come here to be bothered. These people are very unproductive. They have been saying Clive Chirwa here and there'. They are just peddling lies. There are only a few people who are doing this," he said.

And the government has dissolved the board of Zambia Railways in a bid to bring "sanity" to the institution.

Communications minister Christopher Yaluma told The Post in an interview yesterday that the board was dissolved on Thursday last week.

He said a new board would soon be put in place to propel the turnaround of Zambia Railways and a thorough forensic audit into the operations and expenditures of the company would be conducted.

"To revamp ZRL, we need to have a harmonised environment. The environment should be highly conducive to achieve what we want to achieve. We need to have a stable climate with sound relationship between all the stakeholders involved. In an event of having various discrepancies or perceived misunderstandings, it will make the challenge very difficult for the government to achieve our intended goals. So it is in this spirit of trying to ensure we achieve our goals of rehabilitating ZRL and bring it to what it once used to be that we have taken our first step as the government to dissolve the board of Zambia Railways," he said.

"The board in reality was dissolved on Thursday and the letters were written. The only thing that was remaining was to have the letters picked. I wrote the letters late on Thursday and I signed them but we left for Mongu with the President and so they couldn't be circulated."
Asked if the board was in any way hindering the turnaround of ZRL, Yaluma said was not quite so.

On the board's claims of public resources abuses by the rail firm and if any probes would be instituted, Yaluma said the government would definitely institute investigations.

During a press briefing yesterday, Chona, who served as board chairperson of the Task force on Corruption, said, he smelt corruption in the running of the ZRL.

"We have provided the information, it is up to our friends the investigating team to act," he said.

The members said they were not bitter with the decision taken by government to dissolve them but accused transport minister Christopher Yaluma of pulling a fast one on them.

Four members, Chona, vice-chairperson Professor Oliver Saasa, and members Geoffrey Mulenga and Jonam Mwansa said they had recommended to Yaluma that Prof Chirwa be fired following irregularities in the managing of the railway firm.

"He Yaluma agreed during the meeting we had with him and said he would inform State House to proceed with our recommendation but the next thing we hear is that he was going to see the head of state to fire us…," Prof Saasa said.

He said it was a pity that the board was at the mercy of politicians.

"Boards are supposed to be independent. Boards must hire and fire. The point we are making is that you find that the tail is wagging the dog when it should be the other way round [because it is the dog that wags the tail. But because there is someone holding on to that tail, giving it so much strength to be able to wag the whole dog, it was not the case," he said.

And Mulenga said the dissolved board officials were not bitter about being fired.

"We are very happy we are out of this problem, we can have peaceful sleep instead of thinking about what is going to happen next," Mulenga said.

"But the next board, who will replace us, if it has the people's interest at heart, will definitely not tolerate what Prof Chirwa was advancing. Good corporate governance demands that the CEO of the company is far away from tender processes."

The members maintained that Prof Chirwa's counter allegations that they were demands huge sums of money in sitting allowances were ridiculous.

"It is a heap of nonsense that we demanded to be paid K500 million," said Mwansa.

Five ZRL board members on Saturday alleged several illegal and unapproved actions by Prof Chirwa, including an alleged attempt to shift the company headquarters from Kabwe to Lusaka.

The five members, Chona, chairman, Prof Saasa, vice-chairman, and members Geoffrey Mulenga Irene Mbewe, Mwansa, dismissed Prof Chirwa's statements carried by the Daily Nation newspaper to the effect that they were demanding up to K500 million in sitting allowances.

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