• The latest Auditor-General report records a US$1.118 million CMED procurement for 23 vehicles, with only five delivered by the audit follow-up
• One supplier still owed three vehicles from an eight-vehicle order, while another had delivered none of 15 vehicles
• The procurement failure adds pressure to a company already waiting up to a year for Government payments and carrying ZWG93.9 million in unpaid statutory obligations

Harare-  Central Mechanical Equipment Department (Private) Limited (CMED), a Zimbabwean state-owned company that provides transport services and hires out plant and equipment for public infrastructure works such as roads, dams and bridges,  entered the latest Auditor-General report with 18 vehicles still outstanding from a procurement programme valued at US$1.118 million, extending a contract-management problem into capital that the state transport company has yet to convert into operating assets.

The 2025 Auditor-General Report on State-Owned Enterprises and Parastatals records a procurement of 23 motor vehicles by CMED and says only 5 had been delivered. A follow-up of previous audit findings provides the supplier split. 3 vehicles remained outstanding from an order of 8 from one supplier, while a second supplier had delivered none of the 15 vehicles it was contracted to supply.

The delivery outcome remains material for CMED because vehicles sit directly inside its operating mandate.

CMED provides transport services and plant and equipment hire for the construction of roads, dams, bridges and other infrastructure. Capital committed to vehicles generates an economic return when those assets enter service, support contracts and produce hire or transport revenue. 18 vehicles remaining outside the operating fleet delays that conversion.

The procurement also forms part of a wider delivery problem. CMED ordered 3 roller drums under a separate US$358,083 procurement in which 2 were delivered. The supplier refunded US$40,000 on the outstanding unit, leaving a balance of US$8,000 unresolved at the time of the audit follow-up. CMED had also received only 22 of 50 motorbikes ordered under another procurement.

The Auditor-General classified the motor vehicle procurement finding as only partially addressed. That status shifts attention from the original procurement decision to the controls that operated after suppliers failed to perform.

A public procurement system is meant to protect public funds at several stages. Supplier capability can be assessed before a contract is awarded, while contracts themselves can set delivery dates and link payments to milestones. Government can also require performance security to recover money if a contractor fails to deliver, and where advance payments are made, these can be backed by guarantees.

Zimbabwe’s Public Procurement and Disposal of Public Assets Act provides for performance security and requires procurement contracts to set out delivery terms, payment conditions, remedies for breach and provisions dealing with non-performance. Where advance payments are used, the legislation generally provides for an advance payment guarantee covering the amount advanced unless the contract stipulates otherwise.

The CMED audit does not disclose which of those protections existed on the vehicle contracts. That information determines how exposed public capital became after delivery failed.

A supplier failing to deliver 15 vehicles leaves a different financial outcome where CMED still holds most of the contract price, compared with a contract under which substantial cash has already been advanced without sufficient security.

The next accountability step therefore requires disclosure of supplier-level payments, delivery deadlines, guarantees held, penalties accrued, recovery action and the current status of the 18 outstanding vehicles.

The vehicle procurement also needs to be read against CMED’s own cash position. The Auditor-General found that 6 CMED projects were operating without contracts in place and that projects completed in 2022 still had US$2.77 million outstanding. Management said it continued pursuing payment from its parent ministry.

Government is CMED’s largest customer and debtor. The company told auditors that payment for Government invoices can take between 6 months and a year. Those delays had contributed to ZWG93.9 million in unpaid PAYE, VAT and corporate tax obligations by the end of the reporting period. Management said payment plans with statutory authorities were difficult to When government does not pay on time, CMED’s capital cycle breaks down. Work is done, invoices go unpaid, cash tightens, and tax obligations fall behind. Money committed to undelivered equipment is also trapped, leaving less to run the business. That creates a wider cost to the vehicle deal. Instead of sitting with suppliers, those vehicles could be earning revenue on transport and infrastructure jobs, supporting state programmes, and replacing old fleet. Until they are delivered, they produce nothing.

The Auditor-General had already raised concerns about CMED’s fleet. Its latest report notes most grounded vehicles have now been disposed of and the rest are serviceable, but rates the issue as only “partially addressed”

Fleet renewal consequently carries a clear operating purpose. Procurement failure weakens that renewal programme precisely where the company is trying to improve the quality of assets available for service.

The report also establishes a wider public-sector pattern. Across state entities, the Auditor-General found weaknesses in contract management and procurement due diligence that resulted in unrecovered payments for machinery, vehicles and other goods that remained undelivered. Contract price variations of up to 32% were recorded elsewhere without supporting addendums.

The 18 vehicles CMED is still waiting on point to a bigger problem with how capital is managed. Government tends to measure procurement success when a tender is awarded, but the real test comes after. Value is only realised once a vehicle is delivered, registered and working,  when it is actually generating the service taxpayers paid for. In that sense, contract completion matters as much as tender compliance.

An unmodified audit opinion means CMED’s 2024 accounts were fairly presented, not that the business was well run. In the same report the Auditor-General flagged weaknesses in contract management, money owed by government, unpaid statutory obligations and procurement that was not completed. Both can be true at once. Accounts can be correct while the underlying deal is still broken. What matters now is recovery, not just reporting. CMED should publish, by supplier, the number of vehicles outstanding, payments made to date, guarantees held and what steps have been taken to enforce the contract. For suppliers who can still deliver, set a deadline, and for those who cannot, move to recover the money and security.

Going forward, payment terms should be tied to delivery. Performance bonds and guarantees on advance payments should be standard where public money is at risk before goods arrive. That is how to protect capital. The AG has counted what was delivered, the next count must be what is recovered. If CMED secures delivery and the remaining contract value, it converts a liability into working fleet.

Continued non-delivery would leave the company carrying another cost alongside the US$2.77 million Government receivables and statutory arrears already constraining its working capital. For a company whose mandate depends on vehicles and equipment being physically available to work, procurement performance ultimately has one measurable endpoint.

The asset has to arrive.

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