The National Assembly on Tuesday passed the Reserve Bank Debt Assumption Bill clearing the way for the state to assume the central banks contentious US$1,3 billion debt amid strong protests from the opposition MDC-T which argued the bill was irregularly passed – in the process creating legality of the bill.
The bill intended to create a clean slate for the central bank to resume its core functions which among others include being a lender of last resort to other banks.
The bank under the reign of Gideon Gono started an unprecedented level of quasi-fiscal policies that saw the banks debts balloon 300-fold from $400 million to $1,2 billion in a decade.
It remains important that the new debt should be broken down to how each debt was contracted and what it was specifically used for.
Nearly 50% of the new debt ($500 million) was used to support the newly resettled farmers after the chaotic land reforms that started in 2000 disguised as spontaneous farm invasions.
The $500 million is roughly broken down into $200 million for farm mechanization and $300 for farm inputs scheme.
These two schemes directly benefitted Zanu PF functionaries, judges and senior civil servants who among other things received farm implements and farm inputs. The implements included tractors, trailers, combine harvesters, ploughs and planters while the inputs included seeds, fertilizers and diesel.
The remaining $400 million was used for projects such as Baccossi, ASPEF and the controversial currency re-denomination under Sunrise 1 and 2.
The opposition MDC-T and civil society are questioning the legality of asking taxpayers to pick up the debt on behalf of a few connected Zanu PF functionaries who directly and personally benefitted from the debt and are not asked to pay back.
MDC-T argues before the state assumes the central bank debts there should be a properly debt audited in terms of how the debt was contracted, where was it used and in cases where the beneficiaries were private individuals then they should pay.
This position is shared by Zimbabwe Coalition on Debt and Development (ZIMCODD) which argues politicians and their cronies cannot be allowed to have their personal debts settled by the state.
“The debt should have been audited first before the Bill was passed and that which is owed by individuals excluded from the main debt the state will assume,” Joy Mabenge ZIMCODD chair said.
However, the passage of the Bill has been riddled with many possible breaches of the Standing Rules and natural law which among other things dictate that persons with direct interest in a matter under discussion cannot participate in decision making about the same.
MDC-T Tafara Mabvuku MP James Maridadi was denied the opportunity to present a petition from his constituency that was against the adoption of the Bill.
Lawyer and Kuwadzana East MP Nelson Chamisa told the Speaker of the National Assembly that the house was violating its own rules by allowing Zanu (PF) MPs who benefited from the debt to vote on the Bill to no avail.
“This Bill is so important on matters of accountability. There are members who benefited but have come here to vote for government to assume their debt,” Chamisa said.
“It is a travesty– like I said Mr. Speaker Sir; it is a violation of our Parliamentary rules. Of course with all due respect to your ruling, it is also a violation of our Constitution of Zimbabwe which has to be noted and stated,” he added.
Finance minister Patrick Chinamasa remained unfazed in the face of protests and insinuated that the aggrieved opposition can seek recourse some way else.
It remains to be seen whether the MDC-T will lodge a court application against the passage of the Bill.
However, what has come out clearly is that Zanu PF is not going to be transparent about the beneficiaries of the debt amidst speculation that they are protecting President Robert Mugabe, senior judges and senior civil servants from public ridicule and political backlash.