War of words rage between Board and Prof Chirwa

Prof Chirwa

A WAR of words is raging between Zambia Railways Limited chief executive officer Clive Chirwa and the board members following allegations and counter-allegations of impropriety and corruption at the company.
Five members of the board, who are not Government employees, have rebutted claims that they were demanding K500 million sitting allowance.
The board members, Mark Chona (chairman), Oliver Saasa (vice-chairman), Geoffrey Mulenga (member), Irene Mbewe (member), Jonam Mwansa (member), say they are ready to resign to facilitate independent investigations against them.
They have also said a case of corruption against them be immediately reported to the Anti-Corruption Commission (ACC) to establish the real truth behind any claim of corruption.
Prof Chirwa has allegedly been issuing press statements to some sections of the media, slighting the character of some board members by accusing them of being corrupt.
“Considering that Clive Chirwa has continued, on a daily basis, to misinform the nation on the true happenings in the board, the laws of the land and that of natural justice demand that truth must be made known to enable the public to appreciate better what is really happening in this public company,” reads the statement issued yesterday.
The board members denied demanding K500 million sitting allowance, saying they receive only KR2,600 per sitting in line with what is obtaining in most public companies. The K2,600 allowance, they said, was inherited from the previous board.
“Although the Minister [Christopher Yaluma] advised the board to revise this upwards to reflect what obtains on the market in the light of what he considered a mammoth task of transforming a non-performing company, the board, during its sitting on 22 March 2013, actually resolved to retain the same amount of K2,600 given the insolvency of Zambia Railways at present,” reads the statement.
The board also dismissed allegations that director finance Regina Mwale was suspended for failing to pay “the huge” sitting allowances to board members.
“Again, there is nothing more distant from the truth than this …the letter to her is very clear and for Clive Chirwa to misinform the public is unfortunate. The truth is this: Clive Chirwa, in the contract appointing him, is expected to live in the Chief Executive’s Residence in Kabwe. However, he believes that Kabwe is too small for him since he claims that he owns and lives in a multi-million British pounds manor house in the UK [the picture of which he strangely circulated to board members in the hope of intimidating them].
Instead, he opted to live in Lusaka from where he commutes to Kabwe, spending a total of four hours in travel time every day. He lives at Fallsway Luxury Apartment, where the director finance continued to pay more than K72 million per month in rentals,” the statement reads and continues, “when the director finance, clearly working in league with Clive Chirwa, resisted the relocation to Kabwe, and mindful that there were several financial irregularities that could not be justified [including paying the  over K72 million monthly rentals without a tenancy agreement], the finance and administration committee of the board resolved to recommend to the full board to institute forensic audit of Zambia Railways in order to protect public money…the board resolved to put Ms Mwale on leave, on full-pay, pending the completion of forensic audit by the Auditor General’s Office.”
“This development greatly disturbed Clive Chirwa, who defiantly attempted to block the leave but with no success. He has continued to this present day to live in Fallsway, in full defiance of board directives.”
The board has also denied allegations that it has moved the US$120 million Eurobond money to Finance Bank without knowledge of Prof Chirwa, saying “boards never get involved in such things”.
It also says Prof Chirwa attempted to move the company headquarters to Lusaka without the knowledge of the board.
“In his characteristic manner, he objected to this and went ahead to initiate the procurement of premises, which the company was to pay about K1.2 billion per month in rentals,” said the five board members.
The board also said Prof Chirwa attempted to rehabilitate ZR without a feasibility study.
“He does not recognise the board in the restructuring process given his self-centred ‘I, me and myself’ approach to everything. Among his ‘visions’ is to build underground railway stations without feasibility studies and without approval of the board. He has since refused to facilitate the development of a strategic plan for ZRL, preferring to use his own document that he developed before the board was appointed,” the statement reads.
The statement says the board faces challenges from Prof Chirwa because it rejected his demand of US$560,000 annual salary (or K248 million per month) and a 25 percent shareholding in Zambia Railways at the end of his five-year contract.
This, the statement reads, is in addition to demanding K2.6 billion annual bonus and six free tickets per annum for his wife and children to the United Kingdom.
The board alleges that Prof Chirwa wanted to chair the ZR procurement committee, which is irregular.
It further alleges that Prof Chirwa attempted to single-source “his dormant company” to train senior staff of ZR.
“One disconcerting development that borders on a possible case of corruption relates to Clive Chirwa’s attempt to use his own company, Clavel Incorporated Limited, to train all senior management staff at Zambia Railways Limited – and without declaring interest.”
“He informed the very first meeting of the board [and it is minuted] that he will hire the company to offer this service. He was advised then that the Board would not allow single-sourcing as it is against Government procurement regulations and that the President has already made a clear position on this. After investigations by the board, it was established that this company, registered in 2000 in the UK, is [as per the filed accounts for the financial year ending 31 August 2011, signed by Clive Chirwa himself] a dormant company with hardly any assets and owned by Clive Chirwa and his family members [wife and two sons],” reads the statement.
When asked to comment on the allegations, Prof Chirwa said he could not discuss the matter as he was at a private function.
He referred the query to Mr Yaluma, who was unreachable on his mobile phone.
The board will address the press today at the Hotel Intercontinental.