STATE controlled daily newspaper, The Herald has published an article in which they revealed that Premier Service Medical Investments’ (PSMI) boss , Dr Tafadzwa Gutu is living large with a lucrative contract that sees him pocket US$23 000 a month in salary and allowances.
By Michael Gwarisa
PSMI is the investment arm of the Premier Service Medical Aid Society (PSMAS) which was established after PSMAS set up PSMI to own its hospitals, clinics and pharmacies so as to offer clinical and curative services to their members at government subsidized rates.
Of late however, PSMI has been struggling to provide full services to its members as well as meet their employees salary obligations. PSMI employees recently wrote to the Office of President and Cabinet (OPC) requesting for the immediate dismissal of the board and management at the beleaguered organisation.
Both organisations PSMAS and PSMI are under a forensic audit that was ordered by government following revelations underhand dealings and alleged activities outside the mandate of providing healthcare. These include allegations of venturing into speculative share buying, gold buying and microfinance businesses.
The Herald reports that Dr Gutu receives a housing allowance of US$1 500 every month and an entertainment allowance of US$1 500 every month. He also gets unlimited mobile phone allowance, he just hands in the invoice, has home internet, again just presenting the invoice, and 500 litres of fuel a month, around US$850 if it is petrol or US$900 a month if he needs diesel. He gets three cars off PSMI, so needs the fuel for this mini fleet. His children can go to very good schools. PSMI will pay fees up to US$45 000 a year and he and his family can go on holiday, locally or abroad with US$1 500 a day per diem.
That being said, should it be true that the PSMI managing director Gutu is earning the US$23,000 every month, then it makes is one of the highest earning in Zimbabweans. Not only that, US$23,000 per months multiplied by 12 months gets us US$276,000 per annum. This is way above what some European leaders and heads of state receive annually.
According to a list of European leaders that was published by the Forbes Magazine, Emmanuel Macron, the current French president and co-prince of Andorra, receives around 142,000 euros per year, (US$154,000). Outgoing United Kingdom (UK) Prime Minister, Boris Johnson receives below 200,000 euros per year with indications that he gets 180,000 euros a year which is equivalent to US$184,379.40
Norway’s Prime Minister, Erna Solberg, received almost 173,000 euros per year between 2013 and 2021, and the prime minister of the Netherlands, Mark Rutte, receives 172,000 euros per year. Both Belgian Prime Minister Alexander de Croo and Austrian Prime Minister Sebastian Kurz receive around 138,000 euros per year.
While we wait for audit results from government to be released, it is imperative to note that digging deep into the coffers of struggling institution for self-gratification and aggrandizement goes against the tenets of basic corporate governance. This shows how corporate governance systems in Zimbabwe fail to adequately monitor and control top executive behavior in the State owned enterprises and or quasi government institutions.
A number of ethical issues emanate from this recurring practice within PSMAS and PSMI as this is not the first time the organisation has attracted bad press owing to failure to nip bad corporate governance in the bub. Back in 2014, the then PSMAS boss, Cuthbert Dube was taking home US$535 000 every month. By the time of the exposure PSMAS was in a debt of $38 million (Herald 24 January 2014). Top management for Premier Service Medical Aid Society (PSMAS) were gobbling US$1 million in basic monthly salaries. The PSMAS annual wage bill rose from US$15 547 171 in 2011 to US$33 413 373 in 2012, almost half of which was paid to the top 14 managers.
There however seem to be ‘reluctance’ to dictate and intervene in time and the delayed response is not just an under-estimation of the problem but some kind of complicity. The corporate governance structures in state owned and state controlled enterprises in Zimbabwe have unceasingly become too fragile to restrain both the development and escalation of executive over-compensation.
PSMI pharmacies are reportedly dry and 80 percent of its total revenue is directed towards salaries PSMI requires at least US$1,3 billion every month to sustain its wage bill. The most painful fact is that all these practices are happening at a time when the organisation was failing to pay doctors and other debtors.
Channeling funds that are contributed by members towards salaries and hefty packs is an injustice of humongous proportions and should be dealt with once and for all within PSMI. It crucial to also remember that access to healthcare services has become an unbearable process. Its worse when a medical aid holder is told to top up money in foreign currency or to be told that there is no medication in the facility and yet they contribute monthly towards their healthcare.
