Debates- Wednesday, 24th January, 2007

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DAILY PARLIAMENTARY DEBATES FOR THE FIRST SESSION OF THE TENTH ASSEMBLY

Wednesday, 24th January, 2007

The House met at 1430 hours

[MR SPEAKER in the Chair]

NATIONAL ANTHEM

PRAYER

__________

MINISTERIAL STATEMENT

PARTIAL PRIVATISATION OF ZAMBIA NATIONAL COMMERCIAL BANK PLC (ZANACO)

The Minister of Commerce, Trade and Industry (Mr Konga): Mr Speaker, a lot has been said about the sell of shares in Zambia National Commercial Bank (ZANACO) to Rabobank of the Netherlands. Let me start by giving a brief background to this transaction.

The privatisation of ZANACO dates back to 1998, when, due to the decline in national economical activities, the financial position of the banking system in the country was weak. In a memorandum to the International Monetary Fund (IMF), dated 10th March, 1999, the Minister of Finance and National Planning, then, Hon. Edith Nawakwi, committed to privatise a number of mining enterprises,  …

Interruptions

Mr Konga: … including Zambia Electricity Corporation (ZESCO), Zambia Telecommunications (Zamtel), Njanji Commuters, Tazama Pipeline, Zambia Post (Zampost), Tanzania Zambia Railways (Tazara) and Zambia National Commercial Bank (ZANACO).

The memorandum by the hon. Minister of Finance and National Planning then was part of Government’s efforts to raise efficiency and boost economic growth. This position was reaffirmed in subsequent economic programmes commitments in 2000.

In March 2001, the Government issued directives to the Zambia Privatisation Agency (ZPA) to sell a majority interest in Zambia National Commercial Bank. This was consistent with Zambia’s commitments under the Poverty Reduction Gross Facility (PRGF) and the Heavily Indebted Poor Countries Initiative (HIPC) documents.

As at 30th June, 2001, it became apparent that institutions like Zambia National Oil Company (ZNOC) and Ramcoz would default on the K150 billion and other loans owing to ZNACO with a gross value of K106 billion which would also require additional provision by the bank of K12 billion.

As a result of the high level of non-performing loans that were not generating any income, the bank was losing approximately, K2 billion every month on interests due on deposit, establishment and the staff cost. The Rural Branch Network was also part of the drain. These accumulative daily losses were eroding the bank’s capital base.

To ratify the situation and bring back the bank to equilibrium and to facilitate the privatisation process, the Government cleaned up the balance sheet of Zambia National Commercial Bank and issued bonds valued at K250 billion to cover the liabilities to Zambia National Commercial Bank of Zambia National Oil Company and Ramcoz.

The New Deal Government under His Excellency, President Levy Patrick Mwanawasa, SC, decided to suspend the privatisation process in December, 2002. This as you recall, contributed to the delay in this country reaching an agreement for a new Poverty Reduction Gross Facility arrangement with the International Monetary Fund. This led to the country being put on a staff monitored programme.

Mr Speaker, in order to put Zambia back on the Poverty Reduction Gross Facility arrangement, in June, 2003, Cabinet modified the mode of privatisation from that of selling a majority stake to that which provided for the retention of all rural branches. Cabinet further directed that the majority shareholding of 51 per cent be with Zambians. The shareholding structure was, therefore, to be as follows:

(i) A maximum of 49 per cent to be held by the strategic partner.

(ii) 25.8 per cent shares to be held by the Zambian public.

(iii) 22 per cent to be retained by existing minority shareholders.

(iv) 25 per cent to be retained by the Government.

This shareholding structure was aimed at addressing public concerns that the majority shares of Zambia National Commercial Bank should be held by Zambians.

This mode also addressed investor concerns that the Government will not have a majority stake in the bank, that is, the majority shareholding will be in private hands with Government holding only 25 per cent. It should be noted that this 25 per cent shareholding grants Government significant rights and protections as will be explained later.

Mr Speaker, let me turn to why the offer of 49 per cent shareholding has been made. This offer is not only going to resolve the financial problems of the bank, but will also help solve matters of corporate governance in the bank. It is also expected that the equity partner will bring in new technology, cheaper credit lines, products and shared management, which will expect to improve the overall condition and performance of the bank.

Notwithstanding the improvement in the financial performance of ZANACO, its reliance on Government deposits and income from Government securities makes it vulnerable to interest rates shocks of these securities, especially as Government fiscal performance continues to improve. The reliance of income from Government securities also makes the institution’s role in financial intermediation limited in comparison with its competitors.

Mr Speaker, there were serious implications if we did not go ahead with the partial sale of ZANACO. It must be borne in mind that the partial privatisation of ZANACO was to ensure a strong private sector driven financial sector which ultimately helped create a stable macro-economic environment.

Mr Speaker, reversing the decision to sales of partial shares of ZANACO would have had the following implications:

(i) Credibility of the Government would have been put on the line in view of the fact that we had an agreed programme with the IMF and, in turn, this would have affected the debt relief under the HIPC initiative;
(ii) Zambia would not have benefited from the Group of 8 Initiative. A reversal of the decision to partially privatise ZANACO would have adversely affected the decision of the Group of 8 to give relief to Zambia;
(iii) this could have triggered a currency and financial crisis as investors would definitely withdraw their resources from the economy…

Hon. Opposition Members: Ah.

Mr Konga: …due to non-attainment of the HIPC Completion Point.

(iv) stability of the exchange rate would have been affected and this would have worsened inflation and interest rates. It should be pointed out that costs of losing credibility as a consequence of the reversal of the decision on ZANACO privatisation would have likely been higher than the costs associated with the privatisation of ZANACO.

Mr Speaker, there are some positive elements in the partial sale of shares of ZANACO. Government expects the following to happen:

(i) The sale of 49 per cent shares in ZANACO is expected to lead to a more even distribution of Government deposits in commercial banks. Currently, about 90 per cent of Government deposits in the banking system are with ZANACO. From a monetary policy point of view, such concentration of liquidity makes the money market unnecessarily liquid, a phenomenon that can lead to high inflation rate if left unchecked. From a fiscal stand point, it has long been observed that ZANACO has for the first time been a dominant recipient of Government liquidity which has in turn been used to purchase Government securities. What this means is that in practical terms, Government has been borrowing its own cash;

(ii) the sale of 49 per cent shares in ZANACO is key to the financial sector reform programme in Zambia and will improve the investment climate, economic efficiency of the banking system and management of public finances;

(iii) the partial sale of 49 per cent shares of the bank will also strengthen its balance sheet, provide it with additional credit lines and provide the bank with a competitive edge through the introduction of new technology, products and service innovations, which will improve service delivery and customer care. This will raise public and investor confidence in the bank;

(iv) the sale of 49 per cent shares in ZANACO will enhance corporate governance in ZANACO, thereby improve business practices by reducing the business of conflict of interest for the Government as a major shareholder of the bank and a major borrower at the same time; and

(v) by offloading shares to the Zambian public, real empowerment of Zambians will be achieved.

Mr Speaker, the House may wish to know that a transparent process was followed in selecting Rabo Bank as a preferred bidder. An open tender process was followed. When the tender was closed on 13th September, 2005, three bids were received from the following institutions:

(a) Rabobank Group of Netherlands, through its wholly owned subsidiary Rabo Bank Financial Institutions Development set up specifically for investing in developing countries;

(b) Zambezi Consortium Limited, incorporated for the purposes of investing in ZANACO and owned by Africa International Financial Holdings LLC 81.6 per cent and Executive Capital Management of Zambia, 18.4 per cent; and

(c) The ICC Consortium comprising Industrial Credit Company Limited 21 per cent, Liyall Investment, 10 per cent, National Pension Scheme Authority 5 per cent, Workers Compensation Fund 5 per cent and Ernst &Young Investments which was a collection of 13 Zambians and 2 non Zambian individuals with 8 per cent.

After a thorough evaluation of the technical and financial bids, Rabobank emerged as the preferred bidder.

Mr Speaker, Rabobank’s gross price for the 49 per cent shares, was US$ 10 million in 2004. This roughly equated Zanaco’s reported book net assets as at 31st December, 2004. This was consistent with the indicative valuation carried out by the independent valuer Price Water House Coopers in 2004.

Mr Speaker, the purchase price will be subsequently adjusted to reflect the movement in the net assets of ZANACO between 1st January, 2005 and the date of completion as reflected in the outcome of the completion audit being conducted by independent auditors. It should also be noted that the agreement would be posted on the website of ZANACO as it is in line with the Zambia Development Agency Act after completion of the sale of 49 per cent shares of ZANACO.

Mr Speaker, a small word on Rabobank. This is a commercial bank and is one of the few remaining ‘AAA’ rated banks in the world, which, in itself, presents ZANACO with significant opportunities for competitively priced credit and other products. It also has a strong background as a rural agricultural bank that is in line with the positioning that the Government wishes for ZANACO.

Mr Speaker, let me also refer to some of the principle terms of the transaction between the Government and Rabobank:

(i) The Government will still have a say in the bank, as it will be represented by two directors and one independent director on the board.

(ii) There is a commitment to retain the rural branches. In fact, there is a commitment to increase the total double of rural branches and outlets by 20 per cent.

Hon. Opposition Members: Aah!

Mr Konga:

(iii) The Government will have veto rights on certain substantial matters such as the sale of shares by Rabobank, disposal of significant assets, reduction or closure of rural branches and any other strategic matters.

(iv) Non-core properties, such as residential houses will be left in the business. This is potentially beneficial in terms of supporting future empowerment of ZANACO employee sitting tenants.

(v) Rabobank will bring only three expatriates as part of the skills and know-how transfer process. At this stage, no redundancies have been agreed. With regard to unionised employees, redundancies, if any, these will be in line with Collective Agreements and Government Labour Laws.

Mr Kambwili: Again?

Mr Konga: Mr Speaker, let me now, turn to the issue of empowerment of Zambians. A shareholding of 25.8 per cent in the bank will be sold to the Zambian public by floatation. This will be further empowerment of Zambians who stand to benefit by a likely upward gain in Zanaco share price gain following the offer. Rabo Bank has also offered to sale 4 per cent shares to the Zambian National Farmers Union to empower more Zambians.

Evidence is abound from the Lusaka Stock Exchange as to how those Zambians that took the risk of buying shares in companies, such as ZAMEFA, Africa Explosives, Zambia Sugar, Zambia Breweries, National Breweries and others have benefited from capital gains on their shares.

Zambians are therefore urged to position themselves to acquire the 25.8 per cent share floatation as they stand to benefit from such an investment.

Mr Speaker, in conclusion let me state that Zambia is not the only country in Africa that is doing such transactions. HIPC countries in the region such as Uganda and Tanzania have had very similar concerns as Zambia on the implications of the privatisation of major state-owned banks.

In Tanzania, for example, there is a dispute as to who the shares in the national macro-financial bank should be sold. The public felt that the decision lacked ownership by the Tanzanian people. The Government, therefore, decided to put privatisation on hold. However, the Government subsequently proceeded to offer 49 per cent share holding to a consortium of local and foreign investors.

The Uganda Parliament passed a resolution not to sell the Uganda National Commercial Bank. Eventually, the bank was sold to South Africa’s Standard Bank’s Investment Corporation.

In Kenya, the Government sold 35 per cent shares holding in Kenya Commercial Bank to commercial banks and this was marked as largely successful. The same trends can be seen in Mozambique, Benin and even countries ravaged by war such as Sierra Leone.

Mr Speaker, let me assure this august House that it is Government’s expectation that the long-term relationship that we have entered into with Rabobank will yield tangible benefits for the country.

I thank you, Sir.

Hon. Government Members: Hear, hear!

Mr Speaker: Hon. Members are now free to ask questions on points of clarification on the statement which has been issued by the hon. Minister of Commerce, Trade and Industry.

Mr Kasongo (Bangweulu): Mr Speaker, the Government unanimously accepted a motion that was moved in this House by the former Member of Parliament for Chipata Central and seconded by the hon. Member of Parliament for Mbala and now Deputy Minister of Energy and Water Development, that ZANACO should not be sold.  Now, the hon. Minister is saying that because of pressure from donors, they have succumbed. Is he saying that donors are more important than Zambians?

Mr Konga: Mr Speaker, It is true that the House passed a motion that ZANACO should not be sold, but the Government weighed the effects of not selling ZANACO. As I have explained, ZANACO was performing poorly. I think I mentioned that.

Hon. Opposition Members: No!

Mr Konga: As a result, to improve the efficiency of ZANACO, the economy of this country and for the benefit of this country, ZANACO was partially privatised. One of the major reasons is to empower Zambians …

Hon. Opposition Members: No!

Mr Konga: … Most people believe that Zambians own ZANACO, but very few hon. Members in this House, actually, have accounts with ZANACO.

Hon. Government Members: Yes!

Mr Konga: Now, the Government is floating 25.8 per cent shares to the Zambian public to really own the shares in ZANACO so that it can be theirs.

I thank you, Sir.

Mr Hachipuka (Mbabala): Mr Speaker, I just want the hon. Minister to explain to this House. In the 1980s many banks were going under and this House legislated that in order to stop banks from going under no one in this country would be allowed to own more than 25 per cent shares. Why then is it that this Government, despite the pressure they are under, have decided to sale 49 per cent shares to Rabobank?

Hon. Opposition Members: Hear, hear!

Mr Konga: Mr Speaker, it is correct that the Financial and Services Act prohibits individuals or any institution to own more that 25 per cent shares in any financial institution. That is a correct position. However, what the Government has done in the interim is that 49 per cent shares have been sold to Rabobank which is selling 4 per cent, as we are talking, to the Zambia National Farmers Union. Subsequently, in the coming months, 20 per cent shares of Rabobank would be floated to the Zambian public …

Hon. Opposition Members: Hah!

Mr Konga: … so that eventually Rabobank will remain with 25 per cent shares only. So, Zambians will actually own more than 45 per cent shares of ZANACO.

I thank you, Sir.

Dr Machungwa (Luapula): Mr Speaker, the President of the Republic of Zambia, Mr Levy Patrick Mwanawasa …

Mr Shakafuswa: Ekomwali!

Dr Machungwa: … went on a public platform following a motion that was debated in this House and announced publicly that ZANACO would not be sold.

Hon. Opposition Members: Hear, hear!

Dr Machungwa: Could it be taken from this reversal that the word of the President cannot be relied upon because he can flip-flop any time?

Laughter

Mr Konga: Mr Speaker, ZANACO has not been sold. I repeat, ZANACO has not been sold. The share structure of ZANACO is what has changed. 49 per cent is going to an equity partner who is going to offload 4 per cent to the Farmers Union  and 25.8 per cent is going to be sold to the public. Therefore, ZANACO has not been sold. Its’ shares are going to be given to the Zambian public.

I thank you, Sir.

Dr Njobvu (Milanzi): Mr Speaker, I would like the hon. Minister to explain why the Government decided to sell 49 per cent to Rabobank so that Rabobank can then sell 20 per cent shares to the Zambians.

Interruptions

Mr Konga: Question!

Dr Njobvu: The question is, why sell the 49 per cent to Rabobank in order for that bank to sell 20 per cent shares again to the Zambian public? Why not sell directly to the Zambian public?

Interruptions

Mr Konga: Mr Speaker, the shares the Government decided to offload to an equity partner were 41 per cent.

Interruptions

Mr Konga: Originally, ZANACO could have been privatised by selling 51 per cent of its shares so that Zambians would have remained with less shareholding, but now only 41 per cent shares were sold to this equity partner. However, because of the Financial Services Act, it is imperative that this equity partner remains with only 25 per cent shares. As a result, that is why they are selling the 20 per cent shares.

I thank you, Sir.

Mr Lubinda (Kabwata): Mr Speaker, as a follow up to the few questions that have been asked concerning the provisions on the shareholding in banks, I would like to find out from the hon. Minister whether he is telling us that the law shall be circumvented between the period that Rabobank will hold 49 per cent and the time it will offload the extra shares to bring it in line with the law. Is that not, already, a breach of law? What is his Government intending to do to ensure that they are not in breach of the law because that ought to be respected throughout the period of sale.

Secondly, Sir, with your permission, in his statement he made reference to the fact that in 2003 a Cabinet decision was made not to sell ZANACO and that because of Zambia’s problem arising at PRGF we have to make a decision to sell ZANACO or to offload some shares in ZANACO. Is he, therefore, confirming to us that the decision behind the sell of shares in ZANACO is not Zambian driven, but in fact, just a bait given to them by the International Monetary Fund (IMF)?

Hon. Opposition Members: Hear, hear!

Mr Shakafuswa: Muzinkala cabe anaba ndalama ni Sata K2 billion.

Mr Konga: Mr Speaker, the selling of ZANACO is entirely the decision of the Government of the Republic of Zambia.

Interruptions

Mr Konga: This is because the Government had to weigh whether it could save the economy of this country or not. As I have said earlier on, getting an equity partner is going to introduce new products to the bank such as having new ideas of managing the bank. We are going to have shares owned by the bank. What has actually happened is that the Government is giving Zambians power to own the bank. The shares that the public are going to own will make them own the bank as opposed to the current situation where people claim that Zambians own the bank when they have no shares in the bank.

Interruptions

Mr Konga: Mr Speaker, the law has neither been breached, broken nor suspended. There is the offloading of 49 per cent shares to only one equity partner.

Mr Lubinda: That is against the law!

Mr Konga: This equity partner is going to offload 20 per cent shares to the Zambian public. The law states that each part must not have more than 25 per cent and that is what is going to be complied with.

I thank you, Sir.

Mr Matongo (Pemba): Mr Speaker, first and foremost, I wish to state that I declare interest in the flotation of shares. I think my colleagues on your right are making their work very difficult for no reason. I would like to find out from the hon. Minister what a sale is and what they have sold other than the fact that they have restructured the shareholding of the bank in search of a strategic partner to cover the 58 per cent exposure the bank suffered out of unreasonable giving of loans. Could the hon. Minister distinguish the two? The moment you do that, you will have done your job because Zambians are confused when you say sale 49 per cent. In my view, you are actually finding a strategic partner for 45 per cent which ties with the current loan.

Sir, could the hon. Minister clarify that actually he has found a strategic partner of 25 per cent which is RaboBank, a corporative bank which is very much in line with my brother’s UNIP policies of socialism, (Dr Njobvu), and then he wants to say that the next shares will be offloaded to the Zambian public. How are you floating the 28.8 percent and secondly, how are you going to encourage the 24 per cent floatation in this current restructuring.

Interruptions

Mr Konga: Mr Speaker, I would like to thank the hon. Member of Parliament for answering the question for me.

Interruptions

Mr Nsanda (Chimwemwe): Mr Speaker, I would like to know how much kickback the hon. Minister received from the sale.

Laughter

Mr Speaker: Order! That question is improper.

Laughter

Mr Speaker: However, since it borders us on accusing a particular hon. Minister, the hon. Minister should state whether what the hon. Member of Chimwemwe is saying is true.

Mr Konga: Mr Speaker, I take very strong exception from that statement. The hon. Member of Parliament must pay respect to this House. He was in the previous Government and I do not want to raise certain issues.

I thank you, Sir.

Interruptions

Mr Speaker: Order! I guide. Those or that type of question is inadmissible and should not be raised in this House again. I gave the hon. Minister the opportunity to reply so that this matter is closed on the Floor of this House.

Mr Imenda (Lukulu East): Mr Speaker, is the hon. Minister aware that ZANACO had been making profits in the last five years much better than the private owned banks. Are we therefore, selling these shares just for the sake of pleasing investors?

Mr Konga: Mr Speaker, in my statement, I mentioned that the Government had to invest K250 billion to clear the balance sheet of ZANACO and that should tell you the performance of the bank.

I thank you, Mr Speaker.

Mr Mooya (Moomba): Mr Speaker, as a soccer fun, I would like to know what will happen to the ZANACO Football Club as you know that this club is representing the Zambia this year. 

Mr Konga: Mr Speaker, I can assure the hon. Member of Parliament that football club will still be supported in this restructuring.

I thank you, Sir.

Mr Milupi (Luena): Mr Speaker, the arithmetic for the hon. Minister does not add up. Earlier on in his statement he said that the shareholding was going to be as follows:

49 per cent for the strategic partner
25 per cent to the Zambian public
0.2 per cent to the minorities
25 per cent to GRZ

Sir, in answer to the question from the hon. Member of Parliament for Mbabala, he stated that Rabobank were going to offload a further 20 per cent from the 49 per cent to the public. Is the hon. Minister saying that ultimately, the Zambian public will own 25 per cent plus 20 per cent which is 45 per cent and then 25 per cent given to GRZ?

Mr Konga: Mr Speaker, that is the correct position.

Hon. Opposition Members: Which one?

Mr Konga: The public owns 45 per cent shares, 4 per cent will be owned by the National Farmers Union, Government will own 25 per cent and RaboBank will own 25 per cent.

Hon. Opposition Member: So the first one was wrong?

Mr Konga: No, eventually.

I thank you, Sir.

Mr Muyanda (Sinazongwe): Mr Speaker, the hon. Minister has clearly told this august House that Rabobank will go into the rural areas, a step forward by this Government.

Hon. Government Members: Hear, hear!

Mr Muyanda: Mr Speaker, I am saying so because I come from a rural constituency where banking is vital.

Hon. Government Members: Hear, hear!

Mr Muyanda: My question is what safety measures the Government has put in place to ensure that plunderers will not launder money by grabbing all the 25 per cent shares considering that some plunderers walked away with K2 billion in their pockets.

Hon. Government members: Hear, hear!

Mr Speaker: Order! Hon. Members, under Parliamentary circumstances, the word ‘plunderer or plunderers’ is unacceptable and I rule that word inadmissible. All the same the substance of the question is ‘how would the Government ensure that there is no money laundering activities as part of the sale of the shares?’ That kind of question is acceptable.

Mr Konga: Mr Speaker, the Government will ensure that laundered money does find its way into the financial system using the security wings. I am sure that is all I can say at the moment.

I thank you, Mr Speaker.

Mr Kambwili (Roan): Mr Speaker, I would like to draw the attention of the hon. Minister to his statement pertaining to the total purchase for the 49 per cent shares. In the hon. Minister’s statement, he stated that in 2004, the bid price for Rabobank was US $10 million, but as at now, they have not come up with the actual purchase price that they are going to pay this 49 per cent. I would like to find out…

Mr Sichilima: On a point of order!

Mr Speaker: A point of order is raised.

Mr Sichilima: Mr Speaker, I rise on a very serious point of order and I need a very serious ruling. Is it in order for the hon. Members of Parliament who participated in demonstrations and petitioning the hon. Minister to come back and ask the same question pertaining the same sale of ZANACO when they petitioned the hon. Minister. Is it in order? I need your serious ruling, Mr Speaker.

Hon. Government Members: Hear, hear!

Mr Speaker: Order! Order! The hon. Deputy Minister in the Ministry of Energy and Water Development is raising a point of order as to whether it is in order for certain hon. Members of Parliament who petitioned the hon. Minister to ask the same question. The answer is yes. They are in order because this is being raised not only in the House, but it is being raised following a Ministerial Statement. What happened outside this House is considered informal by this House. Therefore, the hon. Member for Roan may continue with his question.

Mr Kambwili: Mr Speaker, I thank you for your protection.

Sir, I was saying that in the past, like in the case of KCM, the mine was sold for about US 45 million and the money was to be repaid over a period of five years. The investors moved on site and within one month, they made a profit more than U S $45 million. What is this Government doing to avoid such a situation where Rabobank has moved on site and they have taken over the bank before they actually decide on what the final purchase price of the bank will be.

Secondly, the hon. Minister has said that the rural branches will not go down. In fact, they will increase by 20 per cent. I would like to find out because Rabobank has already issued a statement to the effect that all the rural branches will be run as franchise. In my understanding, a franchise is supposed to be run on a profit basis. Our rural branches of ZANACO do not make profits and they are only subsidised by the urban branches. Therefore, when the hon. Minister stands to tell us that these branches will actually increase I would like to find out from him what mechanisms will be put in place for the rural branches to start making profits after privatisation.

Thirdly…

Interruptions

Hon. PF Members: He is free!

Mr Kambwili: … in his statement, the hon. Minister stated that one of the advantages of selling 49 per cent shares was that there would be an even distribution of Government’s deposits into commercial banks. I would like to find out from the Hon. Minister if he is aware that in fact, at the moment, it is not ZANACO that is having a lot of Government deposits, but Finance Bank. If he is aware, why.

Ms Mumbi: Hear, hear!

Mr Speaker: Order! Hon. Members are now aware that this House follows the one question rule. However, the hon. Ministers have been free to answer all the questions if they wish, but the hon. Minister may answer one of those questions.

Laughter

Mr Konga: Mr Speaker, the purchase price of ZANACO of 49 per cent by Rabobank in 2004 was going to be U S $10 million after the evaluation. Since that time, I do not know if the evaluation was conducted by an independent evaluator. Therefore, once the value is determined, I can confirm that the difference will be paid immediately.

I thank you, Mr Speaker.

Interruptions

Mr Speaker: Order! There must be a microphone which is on inadvertently

Mr C. Kakoma (Zambezi West): Mr Speaker, after the hon. Minister has answered so many tough questions, I want to ask him a very friendly one.

Mr Speaker, why was the Government in a hurry to privatise or share the share in ZANACO before determining the value of the sale price? Why were you in a hurry to privatise or sale before agreeing on the purchase price?

Hon. UPND Members: Hear, hear!

Mr Konga: Mr Speaker, the Government is not in a hurry as such to privatise ZANACO. As I said, the evaluation was done in 2004 at which time we should have concluded the sale, but the documents were only signed last month. Therefore, between 2004 and the time when the documents were signed, the purchase price of ZANACO has changed. 
 
So, the Government has engaged an independent evaluator to determine. It is not that the Government is in a hurry. The position of ZANACO has been known already. From 2004, to the time that the documents were signed, we did not know the value. Definitely now the value has changed.

I thank you.

Mr Mwansa (Chifunabuli): Mr Speaker, I have listened to the answers the Hon. Minister has given, but an issue of concern has been raised in my mind and this has to do with the supremacy of this House in making laws. Only Parliament has the right to make laws or to amend them. Not even Cabinet can ignore the laws made by this House. Can the Hon. Minister explain how they breached the laws made by this House in disregard of this House and go ahead and sell ZANACO without due regard to the laws that this House made?

Hon. Opposition Members: Hear, hear!

Mr Konga: Mr Speaker, if I recollect properly, a motion was passed here not so sell ZANACO and it was not a law.

I thank you, Sir.

Mr Muntanga (Kalomo): Mr Speaker, the Hon. Minister is talking about the sell of 49 per cent shares at the same time he has also admitted that it is prohibitive by law to exceed 25 per cent shares. He later admitted that Rabobank will access 25 per cent shares. If they buy shares in this company, is there a law that will force Rabobank to sell back their shares, so that we can be allowed to buy 49 per cent shares? There is a lot of misunderstanding. Can the Hon. Minister clarify what the correct position is on the sell of these shares? Is it 49 or 25 per cent? There is also the question of Zambia Farmers Union getting 4 per cent. What is the correct position?

Mr Konga: Mr Speaker, in my statement I said that 49 per cent shares of ZANACO will be floated to Rabobank. For the benefit of this House, 0.2 per cent shares of ZANACO are already owned by private Zambians. Therefore, the 99.8 per cent is what we are talking about. Of the 99.8 per cent, 49 per cent will be off loaded to Rabobank, what is going to remain is 50.8. So, the Government is going to offload 25.8 per cent shares to the Zambian public free floatation as I expect. Rabobank through the agreements that has been signed, without coercion from the Government, have offered Zambia National Farmers Union 4 per cent of the shares. And upon the agreement that was signed, they are going to offload 20 per cent of the remaining shares to the Zambian public. I hope that clarifies the position.

I thank you, Sir.

Hon. Government Members: Hear, hear!

Mr Speaker: Repetition of questions on the subject appears that this matter has been successfully dealt with.

Hon. Government Members: Hear, hear!

Mr Speaker: Clarification after clarification indicates that the matter is therefore concluded. I merely advise the House to go over the Hon. Minister’s ministerial statement from tomorrow’s print out if they so wish to follow up.

_____{mospagebreak}

QUESTIONS FOR ORAL ANSWER

FLOODS IN ZAMBEZI, CHAVUMA AND MWINILUNGA

59. Mr Kakoma (Zambezi West) asked the Vice-President:

(a) how many people had been affected by the floods in Zambezi, Chavuma and Mwinilunga Districts, district by district;

(b) what the estimated crop loss in the three districts was;

(c) how many bridges and houses had been destroyed by the floods;

(d) what the current food assessment requirements for the area was;

(e) what measures the Government had taken to assist flood victims and;

(f) what permanent measures the Government had taken or intended to undertake to avert future disasters in Zambezi and Chavuma Districts since flood disasters in the two districts are perennial.

The Deputy Minister in the Vice-President’s Office (Ms Lundwe): Mr Speaker, I want to inform the hon. Members that my office through the Disaster Management and Mitigation Unit (DMMU) in conjunction with the Road Development Agency (RDA) and the local leadership is in the field carrying out a damage assessment in order to determine the extent of damage to infrastructure, crops, houses and the populations that has been displaced.
It is only after the assessments have been completed that the nation will intelligently be informed of how many people were displaced, crops lost, number of bridges and house destroyed and the food requirements.
Hon. Members may wish to know that the Government is interpreting the current flood situation in the affected districts as early warning information to prepare for the relief food programme during the next consumption period (from June 2007 to March 2008).

As of now, my office has done the following:

(a) Conducted aerial assessments with the support of the Zambia Air Force in the affected districts;

(b) dispatched tow engine boats to reinforce the operations in Zambezi and Chavuma West bank;

(c) supplied drums of fuel to each of the three districts for the engine boats for continued assessment; and

(d) secured resources from the Treasury for procuring of other logistical support required.

In light of the foregoing, it is difficult at this stage to render adequate assistance to flood victims as it is the assessment report referred to earlier that will determine the population in need and type of assistance required.
Meanwhile tents have been pre-positioned at the provincial office, Solwezi, to assist the populations that may, however, wish to know that preliminary findings indicate that all the affected households have been integrated in the local communities. The situation is under control.

The Government is working with local leadership in order to find a lasting solution to the problem of flooding in Chavuma and Zambezi. The long-term solution does not lie with government alone, but with affected communities, Members of Parliament and traditional leaders as this would involve relocating the population from flood prone areas to higher grounds within the districts and chiefdoms.

In conclusion, I would like hon. Members of Parliament to note that the Government is aware of the unconfirmed statistical figures that some NGOs are flashing in the media in order for them to secure resources to finance their activities. The Government has a system that cannot depend on NGOs who are generating the figures for their own interest. The mandate of declaring an emergency lies with the Government and not with any NGO.

I thank you, Sir.

Hon. Government Members: Hear, hear!

Mr Kakoma: Mr Speaker, in view of the slow response and slow pace that the Office of the Vice-President is undertaking in responding to a problem that has been with us for more than one month, is the Government in a position to declare a national disaster to the victims of the flooding situation in Zambezi, Chavuma and Mwinilunga so that the international community can come and help since the Government has failed to respond urgently?

The Vice President: Mr Speaker, I appreciate the question by the hon. Member, but I wish to assure him that the Government is not moving slowly because as we speak now, our people are actually on the ground and we are ready to take up our responsibilities as soon as we know exactly the extent of the problem.

I thank you.

Mr Milupi (Luena): Mr Speaker, I am sure His Honour the Vice President is aware that the waters that have caused flooding in Zambezi, Chavuma and Mwinilunga, eventually end up in Lukulu, Kalabo, Mongu, Senanga and Sesheke where we also have floods. Can His Honour the Vice President assure this House that the assessment currently being made in Zambezi, Chavuma and Mwinilunga will also be carried out in the other districts that I have mentioned?

The Vice President: Mr Speaker, the Government is, indeed, aware of the fact that these waters will flow on to the districts that the hon. Member has referred to. We, as soon as the situation in North Western Province has been assessed and we have taken the necessary action, the Disaster Management Unit will move on to the other districts to ensure that when the time comes we are in a position to help.

I thank you.

DONATIONS TO LOCAL NGOS THROUGH STATE HOUSE

60. Mr Lubinda (Kabwata) asked the Minister of Community Development and social Services:

(a) Which foreign Governments delivered donations to local NGOs through State House and functions held at State House from 2001 to 2006; and

(b) what these donations were.
The Deputy Minister of Community Development and social Services (Mr N. Banda): Mr Speaker, there are no records of any donation made to any local NGO through State House as State House is not an agent of NGOs.

Secondly, under the current arrangement NGOs do not provide returns to the Government on the non-financial donations they receive.

I thank you.

Hon. Members: Hear, hear!

Mr Lubinda: Mr Speaker, the question asked is which foreign governments delivered donations to local NGOs through State House and functions held at State House. Is the hon. Minister aware of the fact that several Governments such as Egypt, Libya, Saudi Arabia, China made donations to an NGO at State House during this period. If he is aware, is he therefore, demeaning this House by telling this House that there are no records of such functions that took place at State House?

I thank you.

The Minister of Community Development and Social Services (Ms Namugala): Mr Speaker, State House as an institution has no records of any donations made to an NGO through State House. I think the hon. Deputy Minister made it very clear that State House is not an agent of any NGO.

I thank you, Sir.

Dr Scott (Lusaka Central): Mr Speaker, my understanding of the question by the hon. Member for Kabwata is whether donations were made through functions and not through records at State House to a closely connected NGO. That is a very simple question.

Interruptions

Ms Namugala: Mr Speaker, Ministers of Government sit in this House representing Government and the point is that State House as an institution of Government is not an agent of any NGO.

I thank you.

Hon. Members: Hear, hear!

ELECTRIFICATION OF SENIOR CHIEF ANANG’ANGA IMWIKO’S PALACE

61. Mr Imenda (Lukulu East) asked the Minister of Energy and Water Development when Senior Chief Ananga’anga Imwiko’s Palace will be electrified.

The Deputy Minister of Energy and Water Development (Mr Sichilima): Mr Speaker, I wish to inform the House that the Ministry of Energy and Water Development considers the issue of providing electricity to chief’s palaces to be very important. However, in the recent past, extension of the electricity grid as a way of providing electricity to chief’s palaces has proved to be very expensive since most of these palaces are located far away from ZESCO electricity grids.

Mr Speaker, to remedy this situation, the Government decided to electrify with solar energy all those chief’s palaces far away from ZESCO grids. In this regard, I am glad to inform the House that Senior Chief Imwiko Anang’anga was one of the first beneficiaries of the solar electrification programme on 2nd June 2005.

I thank you.

Hon. Members: Hear, hear!

Mr Chongo (Mwense): Mr Speaker, I would like to find out from the hon. Minister why it is a well known fact that the Ministry has been providing electricity to chiefs palaces and where the palaces are away from the ZESCO grid, they have been provided solar energy. But the disparity is that those that are provided with solar energy do not pay anything as compared to those chiefs that have been provided with electricity. Is there any plan that even those that are provided with ZESCO electricity should not be billed?

Mr Sichilima: Mr Speaker, it is a new question but, however, I want to educate my colleague. Power is not the same, solar depends on natural sunlight and those that are connected to electricity depend on hydropower, which needs to put in money in order to manage it to provide that service.

I thank you.

Dr Scott: On a point of order, Sir.

Mr Speaker: He has already sat so you cannot raise a point of order.

MONEY RECOVERED AND PAID OUT BY THE TASK FORCE ON CORRUPTION

62. Ms Masiye (Mufulira) asked the Vice President:

(a) how much money the Task Force on Corruption had recovered since its inception;

(b) how much money had been paid to international private prosecutors;

(c) what the names of the international private prosecutors were and how much was paid to each one of them;

(d) how much deposit had been paid in the London courts as security; and

(e) how much money had been paid to the Nchito Brothers as local private prosecutors since the inception of the Task Force on Corruption, month by month.

The Deputy Minister in the Vice President’s Office (Ms Lundwe): Mr Speaker, I thank Hon. Masiye for posing the questions on the Task Force on Corruption which will enable me to dispel views that the Task Force is simply gobbling up huge public resources with no significant outcome.

On the contrary, hon. Members, the Task Force has, in fact, recovered immense wealth, property and moveable assets worth millions of dollars and billions of Kwacha as I will show now. Mr Speaker, let me update the House that since its inception, the Task Force on Corruption has recovered not only huge cash amounts, but also valuable properties and moveable assets including the following:

(1) Apartment buildings in Belgium valued at 8.9 million American Dollars;

(2) Six properties disposed off by the National Housing Authority valued at 3.4 billion Kwacha;

(3)  Fifteen (15) properties awaiting disposal valued at K15.2 billion;

(4)  Going concern properties valued at K4.9 billion;

(5)  Various pieces of plant and machinery auctioned at K148.6 million;

(6)  Motor vehicles valued at K1.2 billion;

(7)  Aircraft estimated at US$500,000; and

(8)  Water vessels valued at US$185,000.

In addition to these properties and movable assets, large amounts of cash have also been recovered by the Task Force which has been deposited at the Bank of Zambia in two accounts as follows:

1. Zambian kwacha account has K709,000,000;

2. The dollar account has US$1.1 million.

Furthermore, rentals collected by the access financial services on behalf of ZAMDAEL and HEARNVILLE estates limited as at December 2005 – properties which have since been handed over to the Ministry of Works and Supply – were in the order of over US$200,000 and K117,463,807.22, details of which I will now lay on the table of the House.

Hon. Members: Hear, hear!

Ms Lundwe laid the document on the table.

Hon. Members: Hear, hear!

Ms Lundwe: From the above, it is crystal clear that the Task Force has recovered significant resources from corrupt transactions both within and outside Zambia.

In response to parts (b) and (c) of her question regarding how much money had been paid to international private prosecutors by name, I wish to state that four international private prosecutors were paid the following amounts:

(i) Denton Wilde Sapte were paid US$56,450;

(ii) Class Law were paid US$215,443;

(iii) Howrey Simon Arnold and White were paid US$2.7; and

(iv) DLA Piper Rudnick Gray Cary has been paid 2,619,734.93 British pound sterling

The Task Force has also used the legal services of four local private prosecutors and paid them as follows:

(a) The MNB Legal Practitioners have been paid K1.2 billion and US$805,280;

(b) C. L Mundia and Company have been paid US$220,000;

(c) Zulu and Company have been paid US$200,000; and

(d) Sambo Kayukwa and Company have been paid US$240,000.

Mr Speaker, let me end by stating that fightingcorruption may appear costly, but the benefits of the recovered assets, the elimination of this evil from our society and our improved image among investors and cooperating partners abroad, clearly outweigh these costs and position us to bring more development to our people.

Hon. Government Member: Hear, hear!

Ms Lundwe: Hon. Members, let us support this noble fight against corruption.

I thank you, Sir.

Hon. Government Members: Hear, hear!

Ms Masiye: Mr Speaker, the Task Force was nearly disbanded, there must be a reason. To spend K10,000 to recover K1,000 is not cost-effective considering the amounts of monies that have been spent in the fight against corruption, really, one wonders which comes first. Is it the hen, the chick or the egg?

Hon. Government Members: Both.

Ms Masiye: Looking at the details His Honour the Vice-President has given, I think so much has been spent and this august House would really want to know whether it has really been cost-effective and also to get enlightened on why this Task Force was nearly disbanded.

The Vice-President: Mr Speaker, the issue is not the cost, but even in that case we can prove it that we have recovered more than what has been paid out. But, the principle, the deterrent nature of the exercise does warrant that any credible Government should fight against corruption.

Hon. Government Members: Hear, hear!

Mr Mtonga (Kanyama): Mr Speaker, I would like to say like a colleague said here, I want to declare interest, Mr Speaker. I support the fight against corruption …

Hon. Members: Hear, hear!

Mr Mtonga: … and through out my years in public life, 43 years now, I just fight corruption and crime. I am sad that I cannot ask more than one question because this is very critical. We are not asking questions to stop the work, but to do the job, but I only have opportunity to ask one question, and yet, I have several. Now, in order to be effective in this one, I would like to ask to follow up on the question of my colleague who has just raised this question of cost-effectiveness.

There is a company AVAK UK, and it was one of those companies I believe the Government of Zambia contracted to recover plundered money. They were reportedly, requested to recover money and they recovered some. To my knowledge about US$2.1 million, but they are claiming fees on it of $6 million. So, how can it be that for recovering US$2.2 million, these people are claiming $6 million? That was just part of my huge question that I had sought the indulgence of Mr Speaker to ask. Of local legal firms that have been engaged to help in the Task Force, I believe from the outline of the hon. Minister there are about four. These have been paid huge sums of dollars. I understand retain fees of about $20,000 per month. How much has been paid so far? And contrast that with current charges of $500,000 as being the charge now in court. I am not discussing the merits of that is sub-judicial. Against that again, how is it that you arrived at these four private firms retained by Government at huge fees? What is the criteria? Or is it the continuing plunder by the Government?

The Vice-President: Mr Speaker, I wish to thank the hon. Member and former Inspector-General (IG) of this country and I only hope that he were still Inspector General of Police because he would not have tolerated what is happening. Now, the figure he is giving with regard to the payment to the English firm is simply incorrect. We do not have those records, perhaps, in his private investigations, he has got those and it is up to him to prove it to this House.

The four Zambian firms who are paid US$20,000 per month for their work in assisting the Government to track down the …

Hon. Member: Plunders!

The Vice-President: I am looking for a better word than plunder.

Laughter

The Vice-President: … misappropriation of funds of public funds. We do not think that these are huge and large sums when compared to the noble task that they are carrying out. These are firms and not individuals who employ a lot of people and run fleets of cars to pursue their work whereas US$20,000 would have looked a high figure paid to an individual. This is actually a very fair figure and unfortunately, both the Vice-President and the former Inspector-General are not lawyers.

I thank you, Sir.

Mr Chisala (Chilubi): Mr Speaker, from the figures given by His Honour the Vice-President, one can easily charge that definitely, a lot of money has gone to waste because the Government of the Republic of Zambia resorted to employing international prosecutors instead of local prosecutors. I want to learn from His Honour the Vice-President whether they had the vision that the local prosecutors had the capacity to do the work. This is in the aftermath of the conclusion that the Zambian Government had resorted to employing the foreign prosecutors who in actual fact, have done a commendable job. May I learn from his office as to whether they have confidence in the local prosecutors?

The Vice-President: Mr Speaker, I would like to inform this honourable House and my hon. colleague, the Member of Parliament that these sums of money in question were actually approved in this House. The budget of K29 billion was passed in this House. In other words, it was discussed and understood. With regard to whether we have confidence in the local lawyers, of course we do. All of us end up at their offices when we have problems. This is an international crime for which we required international support. I think it would have been more expensive for Zambian lawyers to travel all over the world in order to follow up this case. So, the combination of the local lawyers and the international prosecutors and investigators has proved that they have done a good job.

I thank you, Sir.

Hon. Government Members: Hear, hear!

Mr Mukanga (Kantanshi): Mr Speaker, what legal framework supports the existence of the Task Force?

Mr Sichilima: Kabila!

Laughter

Mr Speaker: Order!

The Vice-President: Mr Speaker, it is a combination of all legal agencies of the Government, the security forces, Ministry of Justice and Attorney-General, Parliament …

Hon. PF Members: Aah!

The Vice-President: Yes, this Parliament had approved the budget for this actual action. Therefore, the formation of the Task Force is to back up those legal perimeters.

I thank you, Sir.

Mr C Banda (Chasefu): Mr Speaker, what legislation is the Task Force enforcing since the Anti-Corruption Act is under the jurisdiction of a different authority while the other Act under which they purport to act is also under a different authority?

The Vice-President: Mr Speaker, this action is backed by all sorts of Acts passed in this Parliament.

Laughter

The Vice-President: The Zambia Police Act, the Anti-corruption Act and many other Acts which hon. Members, I am sure are aware of.

I thank you, Sir.

Hon. Government Members: Hear, hear!

Mr Chanda (Kankoyo): Mr Speaker, I would like to find out if there are any new cases of plunder and by whom.

Mr Speaker: His Honour the Vice-President; who else is committing new corrupt cases?

The Vice-President: Mr Speaker, that is a new question.

Hon. Government Members: Hear, hear!

Mr Muntanga (Kalomo): Mr Speaker, I am worried about the fight against crime which may be declining. May I know whether the value spent to arrest a simple thief who has stolen a chicken, would be higher than the value of a chicken, and whether that would not be enforced?

Hon. Opposition Members: Hear, hear!

The vice-President: Mr Speaker, I have to confess that I am grateful to the hon. Member for making it clear for those who seem not to understand what this is all about. A crime is a crime. You do not quantify the cost of arresting that crime.

Laughter

Hon. Government Members: Hear, hear!

Mr Kasongo (Bangweulu): Mr Speaker, what action has the Government taken against some members of the task force who were involved in the misappropriation of funds as reported in the Auditor-General’s Report of 2004, in order to uphold the integrity of the task force?

Mr Speaker: Order! The Chair is unaware that that report has been referred to the Public Accounts Committee which has reported. It is possible that the report may have been Tabled, but not discussed in the Public Accounts Committee for further discussion in the House. It might be advisable for the hon. Member for Bangweulu to wait. That is coming.

We have been on this question far too long. I will call upon one more hon. Member.

Mr Hachipuka (Mbabala): Mr Speaker, I am concerned that the task force is putting in a lot of work in trying to arrest the crime. Has this Government thought of using the tax angle to get at this matter quickly? This is because there a lot of Zambians with an explained wealth and using the method that this Government is using, it will take a 100 years to recover any misappropriated funds. Has this Government thought of using the tax angle which puts the owners of proof on the individual who owns the property rather than on the Government pursuing and trying to recover, explaining, proving and spending so much money? Has this Government thought of the tax angle as a quicker method of getting rid of this problem?

The Vice-President: Mr Speaker, the Government has noted the advice and maybe it is already taking place. Who knows?

Thank you, Sir.

Laughter{mospagebreak}

NUMBER OF REGISTERED VEHICLES IN 1965 AND 2005

63. Mr Lubinda asked the Minister of Communications and Transport what the number of registered vehicles was in1965 and what it was 2005.

The Deputy Minister of Communications and Transport (Mr Mubika): Mr Speaker, there were 4,312 registered motor vehicles in 1965 whereas in 2005, we had 24,822 motor vehicles.

I thank you, Sir.

Mr Lubinda: Mr Speaker …

Dr. Scott: On a point of order, Sir.

Mr Speaker: A point of order is raised.

Dr. Scott: Mr Speaker, I am always sorry to raise a point of order on the most articulate hon. Member of Kabwata. However, I have to raise a serious point of order on the Government, specifically on the hon. Minister of Local Government and Housing because she covers this particular area. I refer to an article in the ‘The Post’ newspaper of 23rd January, 2006, which reads inter alia, and I quote:

‘Stick to customary issues, Masebo advises chiefs

Local government minister Sylvia Masebo has advised that the House of Chiefs should not be turned into a parallel Parliament.

And Chieftainess Chiawa of the Goba people of Southern Province has said traditional leaders should not be forgotten because they did a lot to ensure that the MMD Government gets back to power.

Masebo has said the chiefs should be restricted to discussing customary issues as stated in the current Constitution and other business referred.’

Mr Speaker, the issue here is that we have a certain level of talk about chiefs remaining politically independent out of party politics responsible for their own domestic customary matters and yet at the same time, it is very clear from what Chieftainess Chiawa said that they are being used as cadres, agents and campaigners in elections.

Interruptions

Dr. Scott: Is the Government in order, Mr Speaker? Could you ask the hon. Minister to explain to us in a statement what the policy is of chiefs and Government?

Dr. Scott laid the newspaper on the Table.

Hon. Opposition Members: Hear, hear!

Mr Shakafuswa: Do you have a chief? Go back to Britain.

Interruptions

Mr Kambwili: On a point of order, Sir.

Mr Speaker: A point of order is raised.

Mr Kambwili: Mr Speaker, is the hon. Deputy Minister of Finance and National Planning in order to say that Hon. Scott has no chief and he should go back to Britain where he came from?

Interruptions

Mr Speaker: Order! That point of order is inadmissible and the Chair does not really pay attention to those who debate while seated.

Laughter
 
Mr Speaker: I was listening to the hon. Member for Lusaka Central raising a point of order which I authorised.

My ruling, hon. Member for Lusaka Central, is that I understand that was said at an official function at which the hon. Minister of Local Government and Housing was officiating and that will be brought into this House. It was done out there and it remains there.

Interruption

Mr Speaker: Order!

Business was suspended from 1615 hours until 1630 hours.

Mr Speaker: When business was suspended, I had just ruled on the point of order which was raised by the hon. Member for Lusaka Central. That point of order was made while the hon. Member for Kabwata was following up with his supplementary question on Question No. 63. However, through a very unusual point of order on another point of order which is not admissible, I got to know that a rude Member of this House while seated made an unacceptable remark referring to the hon. Member for Lusaka Central.

While I rule that point of order on the point of order inadmissible, I wish to say that running commentaries are not protected by the rules of debate in this House or any House that I know of. You make running commentaries at your own risk and if you make a comment that is unacceptable, the House deserves the right to discipline you. We went through this during the orientation period on our own without these machines here. I am not aware of who that Member of Parliament was, but whoever it is, I hereby rebuke that hon. Member of Parliament. And I would like to warn in general that running commentaries disrupt debate in this House. They are also said to annoy other hon. Members of Parliament. Do not do it.

TAX COLLECTED IN 2005

64. Mr Lubinda asked the Minister of Finance and National Planning:

(a) how much tax other than Mineral Tax and Customs and Excise Duty was collected in 2005; and

(b) of the above tax figure, which of the following taxes were collected, province by province:

(i) domestic VAT;

(ii) PAYE;

(iii) Company tax; and

(iv) Withholding tax, including rent, interest and royalties.

Mr Shakafuswa: Mr Speaker, Custom and Excise Duty were collected in 2005; and

(b) Income Tax figures withholding of the following taxes were collected province by province: Domestic VAT, PAYE, Company Tax and Withholding Tax, including rent, interest and royalties.

Mr Speaker I wish to respond to the question raised by Hon. Lubinda as follows:

Mr Chimbaka: On a point of order, Sir!

Mr Speaker: A point of order is raised.

Mr Chimbaka: Mr Speaker, I have risen on a very serious point of order. Is it in order for the hon. Minister of Commerce, Trade and Industry or if it is the Ministry of Defence that is given the jurisdiction to look after Mulungushi Textiles to keep quiet and fail to make a ministerial statement when our people have lost employment and are suffering out there?

Mr Speaker: The hon. Member for Bahati has raised a point of order on the happenings at the Mulungushi Textiles Factory while the hon. Minister is giving a reply to an important question raised by the hon. Member for Kabwata. I take cognisance of the fact that only the majority of this House are new. Therefore, that enables me to guide:

(i) As a custom of this House, if a point of order is made while a Member of the Executive is answering for the benefit of the people of Zambia, the Chair disallows the hon. Minister to continue replying. That normally is the position that a point of order that is raised is considered to be more important than the answer being given and therefore, the answer that is being given is a waste of time which is not;

(ii) A question of that nature normally should be asked in accordance with the Standing Orders. There is a rule here – I believe it is Standing Order No. 30 that enables Members of Parliament who have something very urgent to raise to do so rather than raising a point of order and then it takes weeks before the hon. Minister comes back with a reply. Just to give you an example. Question No. 1 this afternoon is one such question of an urgent nature. That question was submitted only yesterday and today His Honour the Vice-President was able to answer it.

Therefore, if the hon. Member wishes a comprehensive answer to the concerns at the Mulungushi Textiles Factory, he is free to avail himself that facility. I am not saying that should be abused. I know what is urgent and what is not. The fact that several weeks have passed since the impasse at the Kabwe Mulungushi Textiles Factory indicates that the hon. Member of Parliament was not really thinking that the matter was very urgent.

I shall allow, in view of the importance of the question and in view of the fact that the majority of the hon. Members are still new, the hon. Minister to continue with his reply.

Mr Shakafuswa: Mr Speaker, the table for the Income Tax collected by the Government for the fiscal year 2005 amounted to K2,076,187,930,464.76 or K2,076.2 billion.

(b) The following numbers show collection of tax revenue province by province for VAT, PAY, Company Tax and Withholding Tax, including Rent, Interests and Royalties and I have a table below:

For Lusaka, Company Tax in millions K253,132
  PAY    K796,138
  Withholding Tax, including
  Rents, interests and Royalties K125,277
  Total    

Interruptions

Mr Shakafuswa: I am coming to that.

Mr Speaker: Hon. Minister if you have the details province by province, could you lay the details on the Table of the House so that we can make progress.

Mr Shakafuswa: Can I just give them the totals then?

The total VAT and Income Tax for:

Lusaka K2,000,467
Copperbelt K1,310,429
Central K127,618
Southern K146,217
Eastern K40,167
Northern K28,425
Luapula K16,249
Western K17,672
North Western K34,703
Total  K3,721,948.

I thank you, Sir.

Mr Shakafuswa laid the paper on the Table

Hon. Members: Hear, hear!

Mr Lubinda: Mr Speaker, there is a very clear pattern in the taxes collected and this goes to show that there are some areas which contributed very little tax in the year 2005 such as Luapula and Eastern Provinces and this is where the MMD got its majority votes. I would like to find out from the hon. Minister what plans his Government has to ensure that in five years time, these provinces will be contributing a little more than what they are contributing now at only K16 million in case of Luapula for example.

Mr Shakafuswa: Mr Speaker, I would like to thank the hon. Member for Kabwata for that question. Yes, I think the New Deal Government, being a responsible Government, has come up with the Vision 2030. We have got a plan to move the vision through the Fifth National Development Plan in which we are going to use the Medium Term Expenditure Frame Work which is going to be pro-poor and this is going to reduce poverty and create employment opportunities. I think that pattern which we are talking about is a result of concentrating economic activities along the line of rail …

Hon. Government Members: Hear, hear!

Mr Shakafuswa: … which has been a trend by previous Governments many of whom are your members …

Laughter

Mr Shakafuswa: We are working towards bringing productivity in these areas. Mind you, these same areas have contributed a lot to the macroeconomic stability of this country through productivity. These are the most productive areas unlike most of the areas in Lusaka and Copperbelt where you find people who are not engaged in production. When you go to these rural areas, you find people going to the field.

Hon. Government Members: Hear, hear!

Mr Shakafuswa: Here, at eight hours, people are drinking beer.

Interruptions

Mr Shakafuswa: So, we will do a lot to ensure that even here in Lusaka, people who are paying this productive age of professionals less in their employments- If you heard what the previous Members of the Executive gave about the amount of money which is being wasted instead of being invested for the development of the people of Zambia, you will realise that we still have a very big task because of the gap of moneys which is going into private pockets instead of going to development. So, the New Deal Government is working out ways of rectifying these problems.

Ms Masebo: Kulibonesha!

Hon. Government Members: Hear, hear!

Mr Mwiimbu (Monze): Mr Speaker, I would like the Minister of Finance and National Planning to confirm that every responsible Government has a duty to support its citizens despite the fact that those citizens can not pay tax to the Government.

Mr Shakafuswa: Mr Speaker, I thank the hon. Member for Monze for that question. He is very correct. Actually, it is the duty of any Government, irrespective of where they get the revenue from to look after all its citizens as long as they are genuinely Zambians whether of registration card and not where you get a registration card in 1991 dubiously …

Laughter

Mr Shakafuswa: … but if you are a genuine Zambian and you are a holder of a National Registration Card …

Laughter

Mr Shakafuswa: … you are entitled to the revenues of the State.

I thank you.

Laughter

Mr Speaker: There is temptation to spice these answers with politics …

Laughter

Mr Speaker: … why do we not leave out that kind of political spices. Simply answer.

Laughter

Mr Speaker: Next question! The hon. Member for Nalolo is not in the House and  the question has lapses.

TARRING OR UPGRADING TO GRADE ‘A’ OF LUKULU ROADS

66. Mr Imenda (Lukulu East) asked the Minister of Works and Supply when the following roads will be tarred or up-graded to grade ‘A’ gravel roads:

(i) Lukulu-Kaoma road;

(ii) Lukulu-Watopa road; and

(iii) Lukulu-Limulunga road.

The Deputy Minister of Works and Supply (Mr Tetamashimba): Mr Speaker, I wish to respond as follows:

The rehabilitation and maintenance of the Lukulu-Kaoma Road to gravel standards commenced on 31st July, 2006 under the European Union Financed Periodic Maintenance by the Out Put and Performance Based Road Contract awarded to Messrs China Jill Corporation. The rehabilitation works are expected to be completed by January 2007. The contractor will therefore continue to carry out maintenance of the project road for the period of three and half years after completing the rehabilitation this month. The contract signed is worth K27 billion.

With regard to the Lukulu-Watopa road rehabilitation and maintenance, the road between Lukulu and Watopa forms part of the periodic maintenance being carried out by Out Put and Performance Based Road Contract awarded to Messrs China Jill Corporation. The rehabilitation of the project road commenced also on 31st July, 2006 and shall be completed this month January, 2007.

Mr Speaker, there are no immediate plans to construct the Lukulu-Limulunga road from Limulunga to Lukulu through the flood plains. It is, however, the intention of the ministry to rehabilitate the road between Limulunga and Mongu, between Mongu and Kaoma and between Kaoma and Lukulu respectively. This will ensure that Limulunga is linked to Lukulu by a good road network. I wish to inform the august House that the rehabilitation of the road between Mongu and Kaoma has been included in the 2007 Work Plan. The rehabilitation of Kaoma-Lukulu Road commenced also in 2006.

I thank you, Sir.

Mr Imenda: Mr Speaker, the contract signed by the Government with the CGC Company clearly states that the contract ends this month, but the Lukulu-Kaoma road is still in a deplorable state. Now, the question is, when will they make the road acceptable as per contract signed?

The Minister of Works and Supply (Mr Simbao): Mr Speaker, I would like to thank the hon. Member for Lukulu East for his concern. The contract we are discussing is Out Put and Performance Contract. It means that the contractor determines what is he is going to do and then we accept what the contract says he is going to do, in this particular case, the contractor had given a period of six months to bring the road back to serviceable state and that means that a speed of 40 kilo metres per hour is the acceptable speed on that road. After that, the same contractor will stay on the same road for three and half years maintaining the same stipulated speed. At the end of this month the contractor must come to the end of the first part of his work.

There have been problems and the problems has been that it has been very difficult to find the gravel in that area as it is a class II road which means that it is an engineer’s road, aligned road which is five metres wide. There has been a problem of finding gravel and that is what he is grappling with. At the end of this month the entire section is being given, he must finish his first part and start the second part of maintenance.

I thank you, Sir.{mospagebreak}

VALUE OF MOTOR VEHICLE SPARES IMPORTED IN 2001/2005

67. Mr Lubinda asked the Minister of Finance and National Planning what the value of the motor vehicle spares imported into Zambia from 2001 to December, 2005 year by year was.

The Deputy Minister of Finance and National Planning (Mr Shakafuswa): Mr Speaker, I wish to inform the House that I am unable to provide the amounts for the years 2001 and 2002 because the ASYCUDA 2.7 System was upgraded in 2003 to ASYCUDA plus-plus and the data in the two periods will not be comparable.

However, allow me to report that the value of car spares imported into Zambia for the years 2003 to 2005 are as follows:

2003 K73,483,228,604
2004 K92,939,994,484
2005 K90,652,294,489

Mr Speaker, I thank you.

Mr Lubinda: Mr Speaker, the ASYCUDA System was installed in 2003. I wonder whether the ministry did not have records before the ASYCUDA System so that the hon. Minister could have provided information for the years 2001 and 2002.

Sir, besides that, could the hon. Minister have any explanation for the increase in the cost of spares that are being brought into Zambia? Is it just as a result of increased motor vehicles or is it as a result of the rate at which motor vehicles in Zambia are requiring repairs because of the poor condition of roads?

Mr Shakafuswa: Mr Speaker, actually, the value of spares imported can be attributed to a lot of factors which needed research. Nevertheless, I will attempt answering that question. You will find that there are a lot of 1964 model cars which are still on Zambian roads. If you have a very good maintenance record of your car, you will realise that every six months or thereafter, you will have your car serviced.

As for the issue of roads, I think you are happy that most of the roads have been worked on. I therefore, do not think that roads have a lot to do with the wear and tear of the motor vehicles compared to usage. You will find that sometimes the way we use our motor vehicles contribute to their wear and tear. I may say that the roads may contribute, but there are a lot of other factors that contribute to this.

The other contributing factor is the MMD policies that have allowed a lot of people to be able to buy cars because of reduced duty and the appreciation of the Kwacha. People are able to buy dollars which allows them to buy motor vehicles and a lot of people are able to bring in cars into the country. This also depends on the type of motor vehicle you bring. If you bring an old car which will need service, it will need spares to be imported.

I thank you, Mr Speaker.

REPAIRS ON THE TRUNK ROAD FROM SAMFYA

68. Mr E. C. Mwansa (Chifunabuli) asked the Minister of Works and Supply when repairs of the trunk road from Samfya through Lubwe/Kasaba to Luwingu, which were halted in 2000 would be resumed.

Mr Tetamashimba: Mr Speaker, I wish to inform this House that the maintenance works of the trunk road from Samfya through Lubwe/Kasaba to Luwingu which were halted in 2000 resumed in 2004 with the appointment of Messrs AMC Contractors who were engaged to carry out the maintenance works of the project road. However, in 2005 there was no provision in the Budget for maintenance of Samfya-Lubwe-Kasaba-Luwingu Road and instead, part of the funds provided for the feasibility studies in 2004 Budget were utilised to continue the maintenance works of the project road.

These funds were exhausted by May, 2006 and work stalled until December, 2006 when works resumed following authority from the Ministry of Finance and National Planning to utilise part of the bridge maintenance funds which were provided for in the 2006 Budget. The works are still in progress and we expect to complete the same in May 2007.

Further, my ministry intends to upgrade the existing road between Samfya and Luwingu through Lubwe and Kasaba to bitumen standard. The ministry appointed Messrs Brian Colquhoun Hugh O’Donnell and Partners in 2003 to carry out a Feasibility Study for the improvement of the road to an all weather standard. The study was completed in 2005.

I thank you, Sir.

Mr E. C. Mwansa: Mr Speaker, could the hon. Minister just help the people in the area by at least dealing with the bridge between Kasaba into Mutondo so that the road can be passable while the other measures are still taking place?

Mr Tetamashimba: Mr Speaker, since the hon. Member of Parliament is the representative of the people in that constituency, I would request that we meet and see how we can provide the funds from this other side to the bridge that he wants us to attend to…

Interruptions

 Mr Tetamashimba: …so that the people will be able to appreciate what they have spoken through their hon. Member of Parliament.

I thank you, Sir.

Hon. Government Members: Hear, hear!

BRIDGES ACROSS THE ZAMBEZI RIVER

69. Mr Imenda (Lukulu East) asked the Minister of Works and Supply when bridges across the Zambezi River to link Lukulu East Parliamentary Constituency to Kabompo District would be constructed.

Mr Tetamashimba: Mr Speaker, our ministry has no immediate plans to construct bridges across the Zambezi River in Lukulu East because of limited funds. Between Lukulu East and Kabompo, the Government has provided a pontoon, which has been working for many years now. As at now, my ministry has delivered components to that area except for the engine. 

It is our hope that by the time the hon. Member of Parliament will be adjourning, he will find that the development has taken place

Mr Mooya: Mr Speaker, I can remember that about three to four years ago, there was a Presidential directive that come 2007, all the pontoons in Zambia should be replaced by bridges. May I know what happened to that directive especially that the hon. Minister has mentioned the pontoons in Lukulu East?

Mr Simbao: Mr Speaker, I would like to thank Hon. Mooya for his follow up question on the bridge.

Sir, the place where Lukulu East and Kabompo District join is at Watopa. What is at this place is a manual pontoon, but it is in very good shape. I was there for something like thirty minutes because I was very impressed with what I saw because the road to that place is very good on the Northwestern side. It is only on the other side where the road is still being worked on. Therefore, I crossed into Lukulu East. Yes, we should build a bridge across that place, but right now the pontoon is sufficient. Once money is available, I am one of those who will ensure that we cross that place.

Hon. PF Member: If you will be there!

Mr Simbao: Yes, if I will be there. If I will not be there, you will do it. It is not a question of being there or not being there, we are all Zambians therefore, we should take care of our fellow Zambians.

Government Members: Hear, Hear. Tell them!

Mr Simbao: I am talking as a Zambian and not as a foreigner.

Mr Speaker, the crossing between Lukulu East and Lukulu West is another important place. This is the place the hon. Deputy Minister was talking about where he wants us  to deliver pontoon components. We would like to put a pontoon at that place, but we have a problem because when the river goes low there is a lot of sand and that will create a problem. For the same reason we have not yet found a way of building apartments for the bridge and that is the problem that we are facing as a ministry.

I thank you, Mr Speaker.

MONGU/KAOMA ROAD REPAIRS

70. Mr Imenda (Lukulu East) asked the Minister of Works and Supply:

(a) how much money had been spent on the ongoing repairs of the Mongu-Kaoma Road;

(b) when the project would be completed; and 

(c) whether there were any plans to alter or modify the existing road plan.

The Deputy Minister of Works and Supply (Mr Tetamashimba): Mr Speaker, I would like to inform the House that the Ministry is not aware of any works on the Mongu/Kaoma Road, but the Provincial Road Engineer for Western Province has been patching the area with an amount of K100 million. The plans are there with the Danish Support and we will continue resurfacing the road up to Mongu.

We had first phase which started from Lusaka to Kaoma in 2003 to 2006. The second phase is starting this year, 2007 to 2011 which will be from Kaoma to Mongu. Therefore, the way the road is looking from Lusaka to Kaoma is the way the road will be looking from Kaoma to Mongu.

I thank you, Sir.

CHINESE NATIONALS IN ZAMBIA

71. Dr Scott (Lusaka Central) asked the Minister of Home Affairs:

(a) how many Chinese nationals were in Zambia as of 30th June, 2006;

(b) on the basis of which visas or permits were the Chinese national at (a) allowed entry in the country; and

(c) how many Chinese nationals were expected to be in Zambia by the middle of 2007.

The Deputy Minister of Home Affairs (Mr Musosha): Mr Speaker, I would like to inform this House that there were 2,224 as of 30th June, 2006.

Mr Speaker, on the basis of which visas or permits were the Chinese nationals mentioned above allowed entry into the country, the following are the tabulated figures:

(i) Employment permits   1,543
(ii) Self-employment       204
(ii) Entry permit or resident permit      95
(iv) Temporally permit           316
(v) Visiting permits          34
(vi) Study permit           32

Total                   2,224

Mr Speaker, yes, we have Chinese students and some of them are doing research in this country.

Sir, we expect the number of Chinese National to double by mid 2007. This is so because of agreements and contracts which have been made as well as the number of Chinese nationals who had shown willingness to invest in Zambia especially after the visit to China of His Excellency the President, Mr Levy Patrick Mwanawasa, SC who explained how good it was for Chinese nationals to invest in Zambia.

Mr Speaker, I thank you.

Hon. Government Members: Hear, hear!

Dr Scott: Mr Speaker, I am a little bit baffled because in his maiden speech, the Cabinet Minister for Home Affairs said that PF had been exaggerating the number of Chinese in Zambia saying that there were 80,000. He said that was wrong, it was actually 8,000. Now, we are told that it is between 2,000 which it was last June.  By this June it is expected to double that. Therefore, it should be around 3,000 or 3,500. I am sorry, but sometimes we have a weakness with numbers in this House and I think we should correct this.

Mr Speaker: There is no follow up question as I could understand.

PRIVATISATION OF RAMCOZ

72. Mr Lubinda (Kabwata) asked the Minster of Finance and National Planning:

(a) how much revenue was earned from the privatisation of RAMCOZ;

(b) who were the liquidators or RAMCOZ and how much were the liquidators/receivers paid for liquidating the company;

(c) how many employees lost jobs immediately after the privatisation of RAMCOZ;
(d) how much was paid out as terminal benefits and how long it took to pay the employees after liquidation; and

(e) how many jobs were created by the new owners of the company.

The Deputy Minister of Finance and National Planning (Mr Shakafuswa): Mr Speaker, before I answer the question raised by hon. Lubinda, I would like to give a brief background to the privatisation of the mines. As you are aware before the privatisation of the mines, ZCCM Limited operated ten mines, three smelters, two refineries, two cobalt plants and a tailing leach plant. Over the years the performance of the mines declined considerably to the extent that the very existence of the mines was being threatened. This forced the Government to reconsider its position and adopt a pragmatic mineral policy that would allow for private sector participation. The mineral policy adopted focused on transferring control and operations of the mines from ZCCM to the private sector, mobilising resources, diversifying ownership and allowing Zambians participation.

Mr Speaker, Roan Antelope Copper Mines Limited (RAMCOZ) was initially sold to the Binani Group of Companies in 1997 for a consideration of US$35,000,000. Payment of the US$35,000,000 was made in full through their lawyers, Rothschild & Sons.

Following the privatisation, RAMCOZ took over both mining and non-core mining responsibilities. This led to the financial problems and forced the company to borrow from suppliers and financial institutions to sustain its operations. Subsequently, the company failed to meet its obligations and this situation culminated in Zambia National Commercial Bank placing the company under receivership in the year 2000.

Mr Speaker, I wish to inform the House that RAMCOZ is still under receivership and that the process of liquidating the company has not yet began. Mr Christopher Mulenga of Grant Thornton was appointed Receiver by ZANACO in 1997 and continued up to January 2006 when the management of the receivership was transferred to the Administrator-General.

Mr Christopher Mulenga of Grant Thornton has been paid a total of US$3,306,783 as receivership fees, from August 2002 to January 2006.

Sir, I wish to point out that as part of the privatisation agreement with Binani, it was agreed that no employee would be retrenched in the first two years of operations. Therefore, Binani took over 6,200 employees.

Mr Speaker, I wish to inform the House that the Government released US$35,000,000 in 2004 towards the payment of terminal benefits of former employees of RAMCOZ as a condition for disposing of the mine to new owners.

Sir, Luanshya Copper Mines, the new owners who took over the former RAMCOZ mines in 2004 currently employs 1,500 employees.

I thank you, Sir.

Mr Lubinda: Mr Speaker, the Hon. Minister informed this House that in 1997, RAMCOZ was sold off at a consideration of US$35 million and that the receiver was paid US$3 million, but that Government later on paid a total of US$35 million for the purpose of paying terminal benefits to employees. That being the case, US$35 million was not paid by the people who were supposed to have bought the mine because as the Hon. Minister has informed us, it is under the authority of the Administrator-General. What benefit has accrued to Zambia where the Government actually went out to pay US$35 million on top of the US$3 million that it paid the receiver? What was the benefit to Zambia?

Mr Shakafuswa: Mr Speaker, the receiver fees, which actually is a commission were realised from the profits after disposing off the company’s assets as agreed by ZANACO and Grant Thornton. The US$35 million paid by the Government was to cushion the suffering of the people of Roan because of the loss of jobs. The Government came in with a compassionate gesture which I would want all reasonable thinking Zambians to defend.

Mr Tetamashimba: The New Deal!

Mr Shakafuswa:  It was done in good faith to actually cushion the suffering of the people of Luanshya. If we had assumed that this was a bad deal made by the previous government, who were going to suffer? It is the people who were going to suffer.

Interruptions

Mrs Sinyangwe: But you have already sold off ZANACO!

Mr Shakafuswa: So, I ask the good Zambians to support this.

I thank you, Sir.

Mr Tetamashimba: Kambwili!

Interruptions

Mr Mushili (Ndola Central): Mr Speaker, the Hon. Minister earlier stated how much money was supposed to be paid for the purchase of the mines and how much money was paid to the people who lost employment, but he did not tell us how much money which I would like to know is still owed to the creditors. I believe that the liquidator has a list of creditors.

Hon. Opposition Members: Shame!

Mr Shakafuswa: Mr Speaker, I want to thank the hon. Member of Parliament for Ndola Central …

Mr Sichilima: For Max Motorways!

Laughter
Mr Shakafuswa: … for that question. However, I wish to say that I would have loved to answer that question now, but it requires to be researched. As a transparent Government, we will come back to answer that question when you ask it again in this House.

I thank you, Sir.

Hon. Government Members: Hear, hear!

Mr Kambwili: Mr Speaker, I am taken aback to find that the Hon. Minister seems not to understand what he is talking about. The privatisation of RAMCOZ was paid at 7.5 million what he has been giving us is the privatisation of ZCCM Luanshya Division. What is asked in this question is the privatisation of RAMCOZ which is still on-going and the price that was paid was 7.5 million.

Secondly,  …

Mr Tetamashimba: Question!

Mr Kambwili: I am coming to the question.

Secondly, does the Hon. Minister know that this Government still owes employees of RAMCOZ colossal sums of money through the Mukuba Pension Scheme and NAPSA contributions?

Hon. Member: Hear, hear!

Mr Kambwili: During the RAMCOZ saga, the investor, who are the Binani Group of Companies were not remitting the deductions which were coming from the employees and as such, Mukuba Pension Scheme and NAPSA have said that they are not going to pay the employees because it is the obligation of the Government to pay. What I want to find out is whether the Hon. Minister is aware that Mukuba Pension Scheme and NAPSA have not settled the money for the ex-employees of RAMCOZ.

Mr Shakafuswa: Mr Speaker, the hon. Member wants to portray that he has better information than this side of the House, which is the Government side. I would like to say that I know what I am talking about and if my facts are not factual, I challenge him to bring to this House the facts he has. Let him bring factual information to this House because in this House you are not allowed to bring information, which is not factual.

If the hon. Member wants to ask further questions with his limited knowledge, I would rather he asks a written question for oral answer.

I thank you.

Interruptions

Mr Speaker: Order! The hon. Minister will withdraw the phrase, ‘limited knowledge’.

Laughter

Mr Speaker: Someone should switch off his microphone.

Hon. Members: It is the Vice President!

Laughter

Mr Shakafuswa: Mr Speaker, I withdraw the word ‘limited knowledge’ and replace it with ‘less information’.

I thank you.

Laughter

Dr Machungwa: Mr Speaker, could the hon. Deputy Minister consider that, in fact, the question he was being asked was about RAMCOZ and not Luanshya Division when it was under ZCCM and the question relates to what happened when RAMCOZ was taken over by Government and when again it was being re-privatised. The answer he gave was not, in fact, what was expected.

Mr Shakafuswa: Mr Speaker, I stand by the information as provided by the Ministry.

I thank you.

Mr Mwiimbu: Mr Speaker, I would like the Minister to confirm that RAMCOZ was not privatised and that what was privatised was a division of ZCCM Luanshya and that the questions raised on the Floor of this House on the privatisation of RAMCOZ are misleading.

Hon. Government Members: Hear, hear!

Interruptions

Mr Speaker: Order!

Mr Shakafuswa: Mr Speaker, I would like to thank the hon. Member for Monze for that comment, but I still stand by the answer I have given.

I thank you.

Hon. Members: Hear, hear!

REDUCTION IN INFLATION AND STRENGTHENING OF THE KWACHA

73. Mr Imenda asked the Minister of Finance and National Planning what the social benefits to the people of Zambia are in terms of the following:

(a) reduction in inflation to a single digit; and

(b) strengthening of the Zambian Kwacha against the US dollar.

Mr Shakafuswa: Mr Speaker, the social benefits of single digit inflation (low inflation in general) are:

(i) Low inflation promotes macroeconomic stability and investor confidence (including local investors), thereby creating a conducive environment for business. Additionally, low inflation enhances credibility of the local currency, which consequently affects national pride positively, for those who are patriotic Zambians, a key pre-requisite for meaningful development;

(ii) Low inflation and price stability is a major pre-requisite for edging interest rates down, which enhances access to financial services by the majority of the people. The current trend of an upswing in mortgages for housing and related services is a practical aspect of the social benefits of low inflation;

(iii) As a result of enhanced low inflation and other positive developments, banking and financial services provision in the economy are more likely to increase. A candid example of this is the recent announcements by major banks in the country to substantially increase the number of branches in the country, thereby increasing the savings and investment rate amongst the people for their socio-economic well-being;

(iv) Low inflation affects the poor more positively because the low-income group tends to have fewer assets to cushion themselves against price increases.

(b) In (b), I wish to respond as follows:

(i) Overall, the appreciation of the Kwacha has had several benefits to the economy, which include employment creation through increased investment, improvement in real wages through reduced inflation as well as improvement in the productivity and output of companies;

(ii) The immediate social benefits in the expansion in investment as the cost of imported capital and intermediate goods for the manufacturing, mining and agriculture sectors, such as, irrigation and ploughing equipment fall, leading to an increase in the demand for these goods, besides increased economic growth and employment. In turn, increased economic growth and employment would have a positive impact on poverty reduction as a social benefit;

(iii) The appreciation of the Kwacha has also generated savings as the kwacha amount that Government will require to service its external debt falls. In addition, the cost of other Government foreign currency denominated operations have fallen. The overall implication is that Government has additional resources for priority areas, such as, roads, education, health and irrigation;

(iv) It has also created some savings on the fiscal front in items, which are foreign denominated, and this has enabled the Government to have more resources and ability to provide public goods and services.

I thank you.

Mr Imenda: Mr Speaker, is the hon. Deputy Minister aware that the bank lending rates and oil prices are still very high for the comfort of Zambians?

Mr Shakafuswa: Mr Speaker, I would like to explain this with a historical background. We are coming from an era where over time the economic management of this country was like it was through guessing.

Laughter

Mr Shakafuswa: If you compare that period to now, you will appreciate that, actually, Zambia’s economic performance has improved to an extent that even the international community appreciates the situation by giving a prize to our Bank of Zambia Governor.

Hon. Government Members: Hear, hear!

Mr Shakafuswa: Now, I will say this, from 2005 up to sometime in 2006, the Kwacha appreciated, but if you talk about the current situation which was not in your question, I will explain. There has also been a depreciation of the Kwacha which hedged abuse. You should appreciate that the oil prices …

Interruptions

Mr Shakafuswa: … in 2006 were actually stable because of the appreciation of the Kwacha which hedged the price changes.

Hon. Government Member: Hear, hear!

Mr Shakafuswa: Like for now, what is happening is that the Kwacha is depreciating and this means that the dollar which is required to buy goods and services is becoming more expensive in Kwacha terms. So, we will need to work out a situation where there should be more productivity in the economy so that the external factors bring in more money. The other factor which we should also consider is that the price of copper has been reducing on the London Metal exchange. So, the rate of inflows in the country is reducing.

Mr Speaker, let me also say that we should appreciate that in 2003, the Bank of Zambia introduced a system of Inter-Bank Foreign Exchange Monetary Policy, which entailed that the foreign exchange rate was determined by the markets and it would remain determined by the markets. That is why you find improvement in the stability of prices on the foreign exchange market.

I thank you, Sir.

Dr Scott: Mr Speaker, I am interested in the hon. Minister’s statement that previous Governments operated by guess work. I am not sure whether it is true, but he has so many former hon. Ministers on his side, starting with the Vice-President, the Minister of Information and Broadcasting Services, Member of Parliament for Chienge Constituency and even the Minister of Local Government and Housing, whereas, on this side we are a bit short of experience. So, I would like to ask him whether he has learnt a new form of economics. In normal economics, it is accepted that an over-valuation, revaluation and appreciation of a domestic currency reduces the competitiveness of exports and of domestically manufactured goods in the face of cheaper imports. That is a very simple principle to understand. You can see it happening in the cotton industry, you saw it happening in the early years of Zambia’s independence in almost every industry because of over-valuation. Can the hon. Minister accept this or must we accept his view?

Laughter

Mr Shakafuswa: Mr Speaker, I will defend the people here. Some hon. Ministers contributed to the demise of the agriculture sector in Zambia when they advised Cabinet that the public sector should be involved in the marketing of maize. This led to the Government issuing promissory notes and that is what clearly tilted the agriculture sector …

Interruptions

Mr Shakafuswa: … and someone was Agriculture Minister that time.

Mr Lubinda: Guy Scott!

Mr Shakafuswa: So, when we talk about guess work, some people are equally to blame.

Interruptions

Mr Shakafuswa: Mr Speaker, we should also ask ourselves whose interests we are serving. Others come here talking about commercial farmers who are predominately not in this thing.

Hon. Opposition Member interjected.

Mr Shakafuswa: Yes, I know what I am talking about. There are effects, but for us Zambians it is the pride of a country to have a strong currency. A strong currency has an effect and counter effect on leadership. It is sword which hammers both sides. When the currency was strong people were not complaining that the other side was affected which was import dominated.

Interruptions

Ms Masiye stood to raise a point of order.

Mr Shakafuswa: So, equally today when the other side of the Zambian …

Hon. Opposition Member: Ikala iwe.

Mr Shakafuswa: … economy is appreciating the effect of an appreciated kwacha, I expect such people to appreciate that.

Hon. Government Member: It is too late. Ikaleni mayo.

Hon. Members: Hear, hear!

Mr Speaker: The hon. Member for Mufulira was anxious to raise a point of order. I can guess what it is about.

Laughter

Mr Speaker: Let me guide the House that dwelling on history wont help, whether, it is this left side of the House referring to the right side or vice-versa. There has been too much shifting of political status on both sides of the House. Let us deal with the present so that the future will be better for the people of Zambia. That is the way I would like to guide you.

Hon. Members: Hear, hear!{mospagebreak}

CONSTRUCTION OF A DAM AT KALOMO/MWEEMBA CONFLUENCE

74. Mr Muntanga asked the Minister of Energy and Water Developm,ent:

(a) whether the Government had any plans to build a big dam at the confluence of the Kalomo and Mweemba Rivers; and

(b) if not, what plans were in place to preserve water for both irrigation and construction of a small hydro power stations in the area.

The Deputy Minister of Energy and Water Development (Mr Mwalwa): Mr Speaker, under the National Irrigation Plan and the Fifth National Development Plan, there are plans to build and rehabilitate dams throughout the country for irrigation purposes at suitable sites.

Mr Speaker, the Government has no plans to build a big dam at the confluence of the Kalomo/Mweemba Rivers as the site is not suitable for dam construction.

Mr Speaker, under the Fifth National Development Plan within the framework of investigations for developing of hydro-power sites, Kalomo District is yet to be studied for hydro-power potential. Further, Kalomo is already connected to the national grid and the current developmental plans are by grid extension through the rural electrification programme.

I thank you, Sir.

Hon. Government Members: Hear, hear!

Mr Muntanga: Mr Speaker, rising from the answer given by the hon. Minister that the Government will construct dams in areas that are suitable for dam construction, is the hon. Minister aware that this particular point has been the best construction point for a dam and it was the area chosen to construct a dam before the construction of the Kariba Dam? That was the site which was proposed by the colonial Government to put up a dam before the Kariba hydro-electric power station and before independence. So, what are they doing in the advent that by 2008 we shall have a shortage of power which we already have in the Kalomo area?

Mr Malwa: Mr Speaker, on the study that the hon. Member of Kalomo Central Constituency has mentioned, as per current study, before any dam is constructed in the country, we have our professionals, provincial water engineers and engineers from the

Ministry of Energy and Water Development who do the feasibility studies and before we construct any dam, we base our works on the report from the engineers.

BOREHOLE SINKING IN LUKULU EAST

75. Mr Imenda asked the Minister of Local Government and Housing how many boreholes the Government would sink in the Lukulu East Parliamentary Constituency in 2007.

The Deputy Minister of Local Government and Housing (Mr Kazonga): Mr Speaker, I wish to inform this august House that the Government, with the assistance of the Danish Government, will sink ten boreholes and rehabilitate five unused boreholes in Lukulu East Parliamentary Constituency in 2007. This programme is as per Lukulu District Rural Water and Sanitation Plan submitted to the ministry and will cover Lukulu East Constituency.

Mr Speaker, boreholes to be sunk and rehabilitated in Lukulu East Constituency of Lukulu District are part of the Government’s National Rural Water Supply and Sanitation Programme being implemented in all the provinces with the support of our cooperating partners.

In this regard, the boreholes to be drilled and rehabilitated in Lukulu East are part of the Danish Government Supported Water Supply and Sanitation Programmes which will cover all the districts in Western Province, namely; Mongu, Lukulu, Kalabo, Kaoma, Sesheke, Senanga and Shangombo. Kalomo, Itezhi Tezhi and Namwala in Southern Province, and Kafue and Chongwe in Lusaka Province are also in the programme. The total cost of this Danish Government supported Water Supply and Sanitation Programme is K97 billion. The programme which started last year, 2006, is scheduled to be completed within five years.

I thank you, Sir.

Hon. Government Members: Hear, hear!

Mr Imenda: Mr Speaker, taking into consideration the fact that we are targeting the Millennium Development Goals of 2015, are we sure that we will be able to meet the goals at a rate where we are putting five boreholes in a year.

The Minister of Local Government and Housing (Mrs Masebo): Mr Speaker, the question is appreciated, but these are some of the realities of our situation that due to budgetary constraints, it might not be possible to give more boreholes to one constituency, taking into account that most of the rural areas are in dire need of boreholes.

I thank you, Sir.

Interruptions

ELECTRIFICATION OF SCHOOLS IN LUKULU RURAL

76. Mr Imenda asked the Minister of Energy and Water Development when schools in Lukulu Rural would benefit from the Rural Electrification Programme.

Mr Sichilima: Mr Speaker, in its bid to increase access to electricity in areas far away from the electricity grid, the Government, through the Ministry of Energy and Water Development, in, June 2005, embarked on the project of electrifying chiefs’ palaces and schools using solar energy. The project came about as a result of the Government’s initiative to provide chiefs’ palaces and schools with electricity.

Sir, I wish to inform the nation through this House that for Lukulu District, the following solar installations were made in schools:

School  Area   Date of   School   Solar
      Installation Coverage  System

Muyondoti Basic Lukulu West  29/07/2006 1 office, 4 classes 85wX3
Mitete Basic  Lukulu West  30/07/2006 2 office, 3 classes 85wX3
Sikunduko Basic Lukulu West  30/07/2006 2 offices, 4 classes 85wX2
Lupui Primary Lukulu West  31/07/2006 1 office, 2 classes 85w
Mataba Primary Lukulu West  31/07/2006 1 office, 2 classes 85w

Mr Speaker, it is anticipated that more schools will be electrified with solar in the rural areas which are far away from the electricity grid.

I thank you, Sir.

Mr Imenda: Mr Speaker, we are all aware that all the benefits went to Lukulu West. So, the schools and clinics in Lukulu East have not been benefited from the distribution of the resources. May I know why Lukulu East was ignored?

Mr Sichilima: Mr Speaker, the hon. Member of Parliament is a representative. If some of the schools are far away from the national grid, he should come and enlighten us. However, at that time, these were the panels of solar which could be fitted. I also want to take advantage of this and educate my colleagues that some of the electricity lines that they see are very expensive to tap power from, because we need very expensive step down transformers in some cases. So, if he feels that some schools were left out, he should come and give us this information. Then we will sit down and look at the reason why.

I thank you, Sir.

Mr Kakoma: Mr Speaker, I would like to know why the electrification of schools in Zambia has been a problem when two years ago, the Permanent Secretary from Zambia went to Zimbabwe to sign a contract to electrify all the schools in Zimbabwe from Kariba Dam. Why can that programme not be extended to Zambian schools?

Mr Sichilima: Mr Speaker, like I said before, in some areas where there are these lines, it is very expensive to tap electricity. Some lines have 66kv and 11kv, and it is very expensive to tap electricity from there.

However, the programme of rural electrification is on going and we are currently studying and making a plan. Some of the people may benefit. So, hon. Members need to hold their fire. They might be included in the plan because it is underway.

I thank you, Sir.

REGULATION 24 OF STATUTORY INSTRUMENT NO. 28

77. Dr. Machungwa asked the Minister of Tourism, Environment and Natural Resources whether Regulation 24 of Statutory Instrument No. 28 of 1997 regarding Environment Protection and Pollution Control, which was declared to be ultra vires the Principal Act, Cap. 204 by the Committee on Delegated Legislation and the House, has been repealed.

The Deputy Minister of Tourism, Environment and Natural Resources (Ms Tembo): Mr Speaker, the Ministry of Tourism, Environment and Natural Resources has not yet repealed Statutory Instrument No. 28 of 1997 that was found by the Committee on Delegated Legislation to be ultra vires the Principal Act, the Environmental Protection and Pollution Control Act Cap. 204 of the Laws of Zambia. My ministry is in the process of comprehensively reviewing the Principal Act. This review will not only address issues pertaining to the statutory instrument in question but will also address other weaknesses of the Act that have been discovered during the course of enforcement of the Act. The review will also address issues arising from the Draft National Policy on the Environment.

To this effect, Mr Speaker, my ministry has constituted a committee to undertake this comprehensive review of the Act including repeal of the statutory instrument in question. It is the intention of the Government to bring to this House during the course of this year the proposed amendment to the Environmental Protection and Pollution Control Act Cap. 204 at which time Statutory Instrument No. 28 of 1997 would also have been repealed accordingly.

Thank you, Sir.

Hon. Government Members: Hear, hear!

Dr. Machungwa: Mr Speaker, I would like to ask a follow up question on the answer given by my sister in law.

Laughter

Dr. Machungwa: This is a matter where a statutory instrument issued by the hon. Minister is found to be illegal because it contradicts the Principal Act and does not require to be brought to Parliament to be repealed. Is the ministry really in order to continue operating under that illegal statutory instrument which has led to difficulties in the past because it has meant that certain developments have been allowed to go ahead when, in fact, they should not have gone according to the Principal Act? Is it not possible to just repeal it? It does not need to have to come to Parliament to be repealed because it was not made by this House.

The Minister of Energy and Water Development (Mr Mutati): Mr Speaker, what we are attempting to do is to address some of the weaknesses that are in the Principal Act in order to strengthen it for the purpose of promoting investment and harmonise the Principal Act particularly with the Water Resource and Management Bill. That is what we are doing.

Thank you, Sir.

Mr Mwiimbu: Mr Speaker, I would like to find out from the hon. Minister whether they are going to continue utilising the law that was declared null and void by this House and by the advice that was given by the Attorney-General with impunity…

Mr Kunda: On a point of order, Sir.

Mr Speaker: A point of order is raised.

Mr Kunda: Mr Speaker, is it in order for the learned friend to ask a question in law to a lay person?

Laughter

Mr Speaker: Through that point of order from the hon. and learned Minister of Justice, I get the impression that the hon. Minister wishes to assist. Will the hon. Minister deal with that question, please, though the question is posed not to a learned person, but to a law maker who is also holding a ministerial position. So, he is in order.

Could he continue, please.

Mr Mwiimbu: Mr Speaker, when the point of order raised, I was asking whether the hon. Minister of Environment and Natural Resources will continue utilising a piece of legislation that was declared ultra vires and that the Attorney-General then who is now the Minister of Justice advised that piece of legislation was ultra vires and that there was need to amend that particular law.

Mr Mutati: Mr Speaker, we have been guided by the Attorney-General, but what we have said is that we are going to bring the Principal Act and amend the nuisance component in the Principal Act to make it a viable legislation.

I thank you, Sir.

Hon Government Members: Hear, hear!

Mr Sikota: Mr Speaker, is the Government going to compensate anybody who may have suffered damage or loss as a result of the Government implementing a law which is ultra vires?

Mr Mutati: Mr Speaker, that issue will, obviously be handled by the Attorney-General’s Chambers.

I thank you, Sir.

NUMBER OF PEOPLE ON ANTI-RETROVIRAL THERAPY BY JUNE 2006

78. Mr Lubinda asked the Minister of Health how many women, men and children under the age of 18 were on anti-retroviral therapy by June, 2006, province by province.

The Deputy Minister of Health (Dr. Puma): Mr Speaker, the current National Health Management Information System categorises and reports patients as adults if they over 14 years and as children if they are less than 14 years. This system furthermore does not report on Antiretroviral Therapy because it has just come on the scene and so the mode of reporting is a bit different.

At present we obtain information for age bands other than the age below or above 14 because there is a need to conduct a specific survey of facility level patient records. Such a survey is expensive and not conducted routinely.

However, a computerised system called Continuity of Care Patient Tracking System is currently being developed. This machine will produce information of this nature on routine basis. Currently, it is running in some of the Antiretroviral Treatment centres. Using the current system and support from our co-operating partners, the following information was collected as at June, 2006.

However, due to the nature of the question, I will just mention the figures at national level. At national level, all the patients from ART as at June, 2006 were 64,146 that included adults, 60,227 and children 3,919.

For the province by province data, allow me to lay them on the Table.

Dr Puma laid the paper on the Table.

I thank you, Sir.

DEATHs IN LUSAKA FROM 2001-2005

79. Lubinda asked the Minister of Health:

(a) how many deaths segregated by gender and those below the age of 16 years were recorded in Lusaka fro 2001 to 2005, year by year;

(b) how many of the above deaths were brought in dead (BID) at mortuaries; and

(c) how many of the above were buried at the official burial sites in Lusaka.

Dr Puma: Mr Speaker, again, I have all the data on the number of deaths that were recorded year by year and I will just mention 2005 for information. For males, we had 2,491 deaths below 14 and for females we had 2,232. The rest of the figures, I will lay them on the Table.

Further on part (b), in the years 2001 we had 9,687, brought in dead in 2002, 9399, 2003, we had 9605, 2004 we had 7086 and 2005 we had 7,299; and

Part (c) as far as the Ministry of Health is concerned, all deaths that passes through the mortuaries at official burial sites.

Dr Puma laid the paper on the Table.

I thank you, Sir.

Mr Lubinda: Mr Speaker, in response to my question (a) the hon. Minister said there were 2,491 and 2,232 males and females that had died in the year 2005 under the age of 14. Also to question (b) on the number of deaths that were brought in dead in mortuaries in Lusaka, she said that the figure was 7,299. I wonder how those figures tally. If there are 7,299 brought in dead, how could the total deaths in the same year be almost 4000? Could she clarify that?

The Minister of Health (Ms Cifire): Mr Speaker that could have been a typographical era. We will check it and assure the hon. Member that I will have the correct figure for him.

I thank you, Sir.

LUKULU POLICE STATION

80. Imenda asked the Minister of Homes Affairs when police stations in Lukulu would be provided with the following:

(i) motor cycles;
(j) vehicles;
(k) speed boats; and
(l) office accommodation.

The Deputy Minister of Home Affairs (Mr Musosha): Mr Speaker, the Ministry of Home Affairs through the Zambia Police Service has established a deliberate on-going programme to provide all police stations and posts with motor vehicles, motor cycles and speed boats where applicable.

Mr Speaker, whenever funds are made available, the Police Command has been made to buy vehicles. Early last year, the Marine Section of the Zambia Police was provided with seven boat engines at the cost of K445 million.

Mr Speaker, it would not be wrong to say that Lukulu will benefit from this programme as we wait for new consignment to be acquired.

As for office accommodation, all capital projects such as infrastructure have been included in the Fifth National Development Plan, which runs up to 2010. A number of police stations including the ones in Lukulu will be built between 2007 and 2010 as and when funds are available.

I thank you.

Mr Imenda: Mr Speaker, the hon. Minister has not explained the distribution of the seven boats.

The Minister of Home Affairs (Lieutenant-General Shikapwasha): Mr Speaker, the distribution is according to those that demanded first as the demand is high. A number of them have gone to Luapula, Western and Southern Provinces.

I thank you, Sir.

KARAVINAS IN WESTERN PROVINCE

81. Imenda asked the Minister of Home Affairs when a clean up operation to get rid of hired killers known as Karavinas in Western Province would be conducted.

Mr Musosha: Mr Speaker, Hon. Imenda’s question is that, while it is appreciated that the Ministry of Home Affairs shares the same concern, the provision for conducting a clean up operation to get rid of hired killers known as Karavinas in Western Province is not there. Zambia is not in a State of Emergency nor is it a police state.

However, the Ministry of Home Affairs through the Zambia Police Service will continue to:

(i) intensify police patrols in affected areas;

(ii) implement community policing strategies as we believe the local community is better placed to identify the culprits and instigators; and

(iii) encourage the local community in Western Province to appreciate the firearms amnesty and surrender illicit firearms to the Local Police in exchange for cash.

I thank you, Sir.

Business was suspended from 1815 hours until 1830 hours.

Mr Speaker: When business was suspended the House was considering question Number 81.

 Mr Imenda: Mr Speaker, I would like to allude to the fact that the number of deaths arising from …

Mr Speaker: Order! The hon. Member is debating go ahead and ask your supplementary question.

Mr Imenda: Does the hon. Minister of Home Affairs require a State of Emergency to save lives?

Mr Tetamashimba: It is your brothers who are killing them.

The Minister of Home Affairs (Lieutenant General Shikapwasha): Mr Speaker, the saving of lives is a genuine and immediate issue for us in the police. We sustain and maintain security on all the Zambians. The issue of Karavinas is an issue that requires the involvement of the local Members of Parliament and population in order for the police to have intelligence so that as they go to work on routine work, the Karavinas are pointed out and are arrested and prosecuted.

I thank you, Sir.

MAIZE EXPORTED IN 2005

82. Mr Lubinda asked the Minister of Agriculture and C-operatives:

(a) how many tonnes of maize were officially exported from Zambia in 2005 and at what value; and

(b) how many tonnes were imported and at what cost in the same year.

The Deputy Minister of Agriculture and Cooperatives (Mr Kalenga): Mr Speaker, wish to respond as follows:

(a) 35,495 metric tonnes of maize valued at K31 billion were officially exported from Zambia in 2005; and

(b) 34,199 metric tonnes of maize at a cost of fK33.5 billion were officially imported in the same year.

I  thank you, Sir.

Mr Lubinda: Mr Speaker, I would like to find out from the hon. Minister what plans his Government has put in place ensure that it avoids this kind of works where it exports all the maize and yet it pays much more than what is gained on exportation  …

The Minister of Agriculture and Cooperatives (Mr Kapita): Mr Speaker, I would like to assure this august House, and the nation at large, that we are not going to experience the same unless some unforeseen circumstances come to us. We have taken inventory of all the stocks of maize in this country. For the first time, all the commercial farmers and all millers were able to give the ministry the figures that they were hiding all these years. Right now, we have 315,000 metric tonnes from the private sector and 150,000 metric tonnes from the Food Reserve Agency (FRA) as reserve. We also have another 22,000 metric tonnes.

The Disaster Management Unit of the Vice-President’s Office can count on it. So, we have got 487,000 maize, enough for the next nine months. At the same time, if we are really pushed, we can lay hands on 45,000 metric tonnes of winter maize. Of course, we are aware that floods have taken their toll in Solwezi, Chavuma, Zambezi, Chama, Samfya, Mpulungu and some part of Central Province, Kabwe. Therefore, if we add up our figures, it would be very unlikely that we are going to experience the exportation and importation of maize at the same time.

I thank you, Sir.

Mr Scott (Lusaka Central): Mr Speaker, in 2005, this House passed an amendment to the Crop Marketing Act No. 20 and changed the composition of the Board of the FRA. Now, when I last checked, about four weeks ago, these changes have not been effected and I believe that the FRA is operating illegally. When will it be possible to export and import maize or even store it illegally?

Laughter

Mr Kapita: Mr Speaker, I am very much aware that this august House passed a Bill restructuring the composition of the Board of Directors of FRA. I would like to tell this august House that I am in the process. I have got a list of all the boards under my ministry because I asked my Permanent Secretary to do that. Now, I am looking at their salaries because I want to see why they are always operating in the red. Once I look at the facts and figures, I will be appointing the new board. I apologise for not doing that much earlier.

I thank you, Sir.

FOREST PLANTATIONS IN 1990 AND 2005

83. Mr Lubinda asked the Minister of Environment, Tourism and Natural Resources:

(a) what the volume of Government forest plantations in Zambia in 1990 and in 2005 was and which are they; and

(b) how much was earned from Government forest plantation harvests from 1990 to 2005

The Deputy Minister of Environment, Tourism and Natural Resources (Mr Kaingu): Mr Speaker, the volume of Government Forest Plantations in Zambia in 1990 cannot be quantified as no inventory was undertaken during that period to establish the standing volumes.

In 2005, an inventory was conducted and a total volume of Government Forest Plantation stood at 15,041,087 cubic metres of which 14,365,967 cubic metres under a total area of 55,252.2 hectares was under the management of the Zambia Forest and Policy Cooperation (ZAFICO) while the remaining 1,622,065 cubic metres under a total area of 3,200.01 hectares were under the management of Forest Department.

The plantation under ZAFICO is allocated on the Copperbelt while those under the Forest Department are found in all nine provinces of Zambia.

Mr Speaker, the detailed breakdown of the Government forest plantation in hectarage in 2005 is as follows:

Under ZAFFICO

No.  Plantation  Area (Ha)

1.  Ndola   20,704.00
2.  Chati   14,502.00
3.  Ichimpe  13,335.00
4.  Lamba     6,711.20
      Total   55,252.20

(ii) Under Forestry Department

No.  Plantation  Area (Ha)

1.  Central   290.74
2.  Copperbelt  168.95
3.  Eastern   415.48
4.  Luapula  527.97
5.  Lusaka   167.12
6.  Northern   919.42
7.  North Western  129.68
8.  Southern  380.49
9.  Western  152.19
10.  Zambia Teak Forest   47.97

  Total   3,200.01

Mr Speaker, during the period 1990 to 2005, the Government generated a total of K56,316,762,000.00 from plantations under ZAFFICO and a total of K2,748,831,321.00 from those under the Forest Department.

The total volume harvested during this period amounted to 2,840,414 cubic metres by ZAFFICO and 77,824.5 cubic metres by Forest Department.

Mr Speaker, further more, the details of the harvested volume and revenue earned from Government Forest Plantations under ZAFFICO from 1990 to 2005 is as follows:

Year  Volume Harvested  Revenue Earned
  (Cubic Metres)  (Kwacha)

1990  481,000.00   177,046,000.00
1991    58,000.00   381,134,000.00
1992  106,000.00   691,232,000.00
1993    40,174.00   1,774,770,000.00
1994    33,000.00   2,715,677,000.00
1995    23,983.00   2,319,814,000.00
1996    33,197.00   3,169,000,000.00
1997    33,242.00   3,562,058,000.00
1998    38,119.00   6,121,072,000.00
1999  112,000.00   5,461,109,000.00
2000  760,000.00   7,393,990,000.00
2001  140,165.00   2,914,280,000.00
2002  174,609.00   3,914,839,000.00
2003  220,334.00      512,063,000.00
2004  289,629.00   7,080,278,000.00
2005  296,962.00   8,092,400,000.00
Total 2,840,414.00    56,316,762,000.00
 
Paper was laid on the Table.

Mr Lubinda: Sir, in response to my question, the hon. Minister said that there is no inventory conducted in the year 1990. I wonder whether the hon. Minister is aware of the existence of the Forestry Action Plan for 1997 and 1999 which was financed jointly by FINIDA and NORAD in which the total inventory forest plantations in Zambia from 1965 is very well recorded and if he is aware, could he make an undertaking and come back to this House to provide information on a number of plantations which were put up since 2001 to 2005.

The Minister of Energy and Water Development (Mr Mutati): Mr Speaker, we thank the hon. Member for that request and we shall look for that information and provide it to this House.

I thank you, Sir.

Mr Mukanga (Kantanshi): Mr Speaker, arising from the answers given, I would like to ask the hon. Minister to confirm that the problems that the Forest Department has been experiencing and the reason for not carry out a comprehensive forest inventory is as a result of not having adequate transport to enable the staff move and carry out the same inventory.

Mr Mutati: Mr Speaker, earlier on, we were informed that there was a report that was done. Perhaps, we look at that report so that we can give a comprehensive answer to the issue raised.

I thank you, Sir.

______

MOTION

ADJOURNMENT

The Vice-President (Mr Banda): Mr Speaker, I beg to move that the House do now adjourn.

Question put and agreed to.

_____

The House adjourned at 1845 hours until 1430 hours on Thursday, 25th January, 2007.