New PSMAS chair blasts political patronage

The biggest impediment to good corporate governance in Zimbabwe is political patronage, says the new Premier Service Medical Aid Society chairman, Luxon Zembe.

Dube
Dube

“Politicians have spread their tentacles in both the public and private sectors to such an extent that over 80 percent of organisations in all sectors have a problem with political patronage,” he told The Zimbabwean in an exclusive interview.

“It is important that politicians stay away from business. They are the ones who create political patronage and people end up trying to please politicians and not follow business objectives. The link which politicians have created with business is very unhealthy and creates major problems in the governance of the organisations,” he said.

Zembe, Commonwealth certified corporate governance consultant, was recently placed at the helm of PSMAS after turmoil engulfed the medical aid service provider following disclosures of massive salaries for top management and unprecedented benefits and fees for the board. The former Chief Executive Officer, Cuthbert Dube, was paid around $500,000 per month in salary and allowances.

“CEOs should not be the ones to control the operations of the board. The board must take control of governance within the organisation,” said Zembe.

The previous board, of which Zembe was part, gobbled up close to a $1 million last year alone in allowances. Among the top earners on the board was President Robert Mugabe’s spokesman, George Charamba, who walked away with just over $109,000.

The former chairperson, top civil servant Meisie Namasasu, was dismissed “because she was the one who sanctioned the unprecedented salary and benefits of the group chief executive without consultating the full board”.

“We also discovered that that unbeknown to some of the board she had been bought a Mercedes Benz, which is a violation of good corporate governance principles,” said Zembe, who was paid $82,525 in 2013. He denied that he was compromised by his previous tenure on the board.

“My previous experience gives me a good understanding of the organisation and its business. It gives me a good understanding of the mistakes that have come to the fore and were made in the past,” he said.

He conceded that it was possible for an individual to be tainted to such an extent that it would be impossible to continue within an organisation. “The board required me to take over the chairmanship of the organisation and lead it to safety”. He said the society would hold its annual general meeting in “two to three months”. “By then it is my conviction that the organisation will be on a strong recovery path with integrity that will give confidence to the members. It will then be up to the members to change the crew if they so wish”.

He said Dube had been sent on normal retirement meaning there was no exit package “other than his normal pension benefits”. Dube had reached the normal retirement age of 60 but his contract had been renewed by the previous board. “The board also resolved to recover the organisation’s assets that were in custody of Dr Dube other than the car he was using. These assets include an official house which he agreed to surrender mainly because he had never stayed in it.”

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