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PAC operating beyond its mandate – Storm Mountain Diamonds

by Lesotho Times
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Ntsebeng Motsoeli

DIAMOND miner, Storm Mountain Diamonds (SMD) has lashed out at the parliamentary Public Accounts Committee (PAC) for allegedly overstepping its mandate of gathering information on abuse of government funds by acting as a judge.

Senior management of the SMD yesterday described the PAC as “populist and sensationalist” in a statement to the media at a local hotel in Maseru.

The SMD chairperson, Milford Mundel, said the PAC was acting beyond its mandate and was misleading the public.

Mr Mundel said that allegations that PAC and the Transformation Resource Centre (TRC) have levelled against the mine were false and misleading.

“The TRC alleges that the PAC “discovered” that SMD owes royalties and taxes to the government which is not true,” Mr Mundel said.

“SMD is fully compliant with all of its tax obligations. SMD has also paid all the royalties that are due to the government, as per its mining agreement read with the Mines and Minerals Act of 2005. SMD reports on sales and marketing process. SMD’s books are open to the regulators who can at any time investigate and audit this issue.

“Unfortunately, the activities of the PAC are also populist and sensationalist in nature. The PAC is operating way beyond its mandate as a Parliamentary Committee. It has a legislative mandate but is assuming the role of both the executive (acting as a regulator) and the judiciary (issuing directives) and then without being properly informed and without understanding the correct facts. The PAC’s view on royalties and tax owing by the operating mines is misguided.”

Mr Mundel said that the allegations were creating many false perceptions about the mining industry in Lesotho and the public opinion was being pervaded.

He said the perceptions were reinforced by statements such as the recent “baseless allegations made by the TRC in their press release”.

“It is disheartening to see important institutions and lobby groups such as the PAC and the TRC peddle cheap sensationalism. These organisations have a duty to act in good faith and not to mislead the public.

“By spreading false news…the TRC is provoking conflict, pitting stakeholders against each other and jeopardising social cohesion and important stakeholder relationships.

“SMD rather urges stakeholder to confront issues through fact-based dialogue and discussions. Any stakeholder is invited to contact the mine to engage with it. In doing so and by dealing with facts, we believe that many negative perceptions can be eradicated, stakeholder relationships will improve, with improved sustainability and value creation for all.”

Speaking at the press briefing, the SMD head of legal and corporate and the company secretary, Morné Maree said that PAC had no right to make unconfirmed claims about the operations of the mine.

“PAC has its narrow mandate. It should gather information on misspending and should report to the relevant departments for further investigations. Their claims are biased. They got evidence from one side of the story and never invited us to hear our side of the story. Their actions jeopardise Lesotho and the mine,” Mr Maree said.

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