Audit exposes rot in embassies
A recent Auditor General’s Report of Accounts of the government has exposed serious financial flaws in the country’s foreign missions.
The flaws include misallocation of voted funds, unaccounted for airtime, payment vouchers without supporting documents, failure to contribute towards utility bills, payment of school fees to non-deserving beneficiaries, failure to collect rentals on mission properties and failure to safeguard mission properties.
Other rots the report, which was presented by Finance Minister, Joseph Mwanamvekha in Parliament on May 19, has exposed, include failure to reimburse borrowed funds, procurement of vehicles without an approved budget, failure to transfer visa revenue to government Account Number 1, as well as use of visa and passport fee accounts for other activities without authorisation.
Among others, the report notes that Malawi has an accumulation of debt amounting to $707, 274 (K516,310,020) in Canada despite that Malawi closed an embassy in that country in 2004.
The report says Malawi owns two properties in Ottawa, Canada, which were part of the six properties used by the Malawi High Commission there, before the office was closed and the other four properties sold.
“It was noted that house number 240 on Coltrine Road and Rockcliffe (former official residence) has been vacant since the Mission was closed in 2004 and requires major maintainance for it to be rented out. Despite being vacant, the house incurs expences in form of taxes and property management fees.
“House number 1850 on Comborne Road was rented out at 4,000 Canadian Dollars ($3,080) or K2.2 million per month but it was also accumulating expenses in form of insurance, taxes and property management fees,” the report reads, adding that the properties are no longer classified as diplomatic properties since the closure of the embassy and are treated as commercial properties.
The report says looking at the expenses the properties are incurring and the income being generated, it is clear that the government is losing out on these investments.
The report also reveals that diplomats at Malawi Embassy in Washington DC, America, received an overpayment of rentals of ($29,000) or K21,297,243.30.
“Circular reference number BA/1/3/33 dated 29 February 2016 states that the rentals and school fees should be paid in cash. These rates are lower than those which the diplomats are titled to when direct payment to the landlords was being done. The idea was to reduce on rentals since it was established that it was expensive and less negotiable when the government was dealing with the landlords directly.
“An inspection of payment vouchers in respect of the rentals disclosed that diplomats were being paid rentals using the old rates instead of the revised ones,” the report says.
At the Malawi Mission in South Africa, some of the audit queries established include, under-deduction of utilities from members of staff amounting to K4.8 million, fuel worth K9.77 million not accounted for, procurement of carpets above threshold and K5.255 million unaccounted for stores.
At Malawi’s Mission in New York, the audit queried over-expenditure of personal emoluments and other recurrent transactions of K398, 952,445.88.
The report has also queried the New York office over the use of K85.2 million development funds for ORT activities without the authority of Treasury.
In Mozambique, the audit has queried the Malawi Embassy in Maputo for procuring a representational car from Leites Toyota, eSwatini of $74,223.95 (K54,533,323.24) without a budget.
The report has also faulted the embassy for engaging and paying for security services without a contract agreement.
Still in Maputo, the audit revealed payment vouchers worth K99,819,924 without supporting documents.
In Lusaka, Zambia, payments worth K110,311,862 were made without documentation.
In Harare, Zimbabwe, the audit queried, among other things, the misapplication of payments amounting to K216,319,743.
The audit also uncovered the payment of school fees to non-deserving beneficiaries amounting to K10,376,728.
“Contrary to guidance, an inspection of payment voucher disclosed that the mission made payment amounting to K10,376,728.43 in respect of school fees for students whose biological parents are not the diplomats or who were not adopted by the diplomats,” the report says.
At the country’s embassy in Brasilia, Brazil, the audit has revealed a misallocation of voted funds worth K39,273,928.
It also revealed that payments worth K178,897,849 were made without supporting documents.
Public Accounts Committee Chairperson, Ken Kandodo, was quoted yesterday as saying his committee would meet in the next two weeks to scrutinise the report