By Jonah Pankuku:
Details are emerging that National Economic Empowerment Fund (Neef) has written off K11.3 billion after beneficiaries of its predecessor, namely Malawi Enterprise Development Fund (Medef), reportedly failed to repay loans totaling K26 billion obtained between 2005 and 2018.
Neef Chief Executive Officer Humphrey Mdyetseni has confirmed the development, saying during the period in question, about 80,000 people benefitted from loans under Medef.
Mdyetseni was speaking in Times Television’s Hot Current Programme on Sunday, when he clarified reports that they have written off K6 billion.
He further stressed that “writing off” did not mean “cancelling or forgiving the loans”, indicating that they are pursuing the defaulters.
“Out of the K26 billion loaned out between 2005 and 2018, only 16 percent of the funds were recovered. We, as Neef, have recovered over K2 billion.
“These programmes were politically influenced. Some [people] thought they were given the money as political gifts. Politicians were in the forefront [in terms of] identifying beneficiaries. Incorrect figures were recorded,” added Mdyetseni, claiming that there is zero political interference now.
Speaking in the same programme, Information Minister Moses Kunkuyu said Malawians should be worried with how taxpayers’ money was carelessly abused in the past, attributing the development to “political interference”.
Kunkuyu confirmed that Cabinet met and discussed the issue after it was presented through relevant committees.
“Today, we should be asking ourselves what the K11.3 billion could have done to this nation. Those loans are for all Malawians, irrespective of their political affiliation, and we must all strive to safeguard the funds so that the institution achieves goals for its establishment,” Kunkuyu said.
Reacting to the development, Centre for Social Accountability and Transparency Executive Director Willy Kambwandira demanded that there should be transparency on the issue of those that have failed to repay the loans.
He expressed fear that the issue could be prone to manipulation.
“There must be a mechanism for the nation to know who the defaulters are. There is a need for proper investigations. Our fear is that people could be hiding behind the non-repayment [issue] to loot whatever Neef has collected.
“It is high time we empowered and liberated the National Audit Office and Neef to reduce cases of political interference,” Kambwandira said.
A 2020 special audit at Neef by the government’s Central Internal Audit Unit indicated that some people allegedly defrauded the institution of K53.2 million through loan disbursements to dubious beneficiaries.
