Govt Terminates US$6 Million ZUPCO Service Contract
The Government has withdrawn financial support from the Zimbabwe United Passenger Company (ZUPCO) for hiring buses saying the parastatal has been subsidised enough and must be running profitably and efficiently.
Treasury was giving ZUPCO US$6 a month to enable the company to hire private buses to provide urban mass transport.
In a letter seen by The Sunday News, the Permanent Secretary in the Ministry of Finance, Economic Development, and Investment Promotion George Guvamatanga informed the Ministry of Local Government and Public Works about the development. He wrote:
Given the foregoing intervention by Treasury and mindful of the need to create fiscal space for the procurement of an additional fleet of buses from savings on the hire of private buses, your Ministry is hereby advised of the termination of the financial support for the hire of private buses by ZUPCO, with effect from February 1, 2024.
Treasury will continue to avail support for ZUPCO to seamlessly transition from the hire of private buses.
Accordingly, ZUPCO is requested to provide a status report on the condition of the current ZUPCO fleet and immediate financial requirements to support the transition process.
Guvamatanga said going forward, the private sector should provide mass urban transport system for major cities. He said:
The policy decision entails a review of the current framework of cooperation, whereby ZUPCO is hiring buses from private bus operators to provide a subsidised urban mass public transport service at an average monthly bill of about US$6 million…
As part of measures to support the implementation of the Government decision, and also sustain the viability of ZUPCO operations, Treasury has availed resources amounting to US$500 000 towards procurement of spare parts, adequate to repair 120 non-functional buses.
The repair of non-functional buses, complemented by a programme to procure over 520 buses during the first six months of 2024 is designed to capacitate Zupco to anchor the provision of mass urban transport system without recourse to private buses.
ZUPCO has since notified private bus operators where it was hiring buses that they were not going to renew the contracts which expire on 28 February 2024.
The acting chief executive officer, Tineyi Rwasoka, said in the notice, that they were going to engage private owners as and when their services were needed in the future.
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