Government controlling officers (COs) habitually disregard the law that guides public expenditure, creating massive financial mess in ministries, departments and agencies (MDAs), our analysis of a report by the Public Accounts Committee (Pac) of Parliament has established.
Pac has, meanwhile, vowed to follow through the issues including asking that the responsible officers be disciplined.
The report, dated August 2, 2023, covering the year ending June 2021, shows that some COs enter into contracts with suppliers and service providers without stressing the necessary conditions, resulting in loopholes through which public funds are lost.
It also highlights that some suppliers and service providers are charging interest for delays in payments as well as adjusting contract prices on the pretext that there have been hikes in prices of materials.
Pac also points fingers at COs for apparently being ringleaders in the abuse of resources and abuse of their departments, which are still being queried for charging expenditures to wrong budget lines or unrelated codes.
- Advertisement -
“The misallocations of resources are a circumvention of the intentions of Parliament and an exercise of authority that Controlling Officers do not have,” the report reads.
The lawmakers say they were saddened to note that the Ministry of Foreign Affairs over-funded some embassies with over K1 billion.
“The same Ministry of Foreign Affairs also over-spent on some budget lines with over K2.7 billion. Whereas the government was struggling to find ways of clearing its huge arrears, it was unheard of that some MDAs should be spending beyond what was allocated to them,” the report says.
Under the Ministry of Education, it exposes four school projects valued at K806.5 million which were funded but have not been completed 14 years later.
- Advertisement -
- Advertisement -
After the award of the contracts valued at K806.5 million, government reportedly paid K935.8 million, thus creating an overpayment of K129.4 million “but the projects are not there”.
The districts where the works have stalled include Balaka, Nsanje and Chitipa.
“Some other six contracts were revised upwards ranging from 22 percent to 92 percent increase on the contract sum to the tune of K529,364,358,” the report reads.
Other entities queried on project management irregularities were Southern Africa Trade and Transport Facilitation Project; Nacala Road Corridor Project Phase IV; Ministry of Industry and the Malawi Police Service (MPS) whose queries totalled K21 billion.
The report exposes the following financial flaws at some MDAs: MPS for non-delivery of K78.2 million procured goods; some diplomats at the Berlin embassy did not contribute K126.3 million medical fees; and under-utilisation of Sheriff Fees Development account at the Judiciary at K198.7 million, among others.
The Ministry of Homeland Security, the Malawi Prison Service and State Residences are also among those with issues regarding managing public funds.
Pac has complained that despite “strongly cautioning” the Executive on revenue management irregularities in its previous reports, the problems continue to prevail.
“The committee is not pleased by these trends on claims for payment since they were a clear breeding ground for collusion and fraud as they are contrary to clear regulations of public finance management,” Pac chairperson Mark Botomani said.
Botomani added that the Public Finance Management Act is clear on how Cos should spend to avoid over-committing the government and sanctions for spending above what was appropriated.
Secretary for Education Chikondano Mussa said she would comment on the unfinished school projects matter after going through the report.
“But suffice to say that my ministry appeared before [Pac] and explained why the projects stalled,” Mussa said.
Centre for Social Accountability and Transparency Executive Director Willy Kambwandira said the report exposes corruption, fraud and collusion between government officials and contractors.
“It exposes weaknesses in our procurement processes. This is an organised scheme within the government that is defrauding taxpayers.
“There are people masquerading as contractors who are conniving with public officers to steal from Malawians,” Kambwandira said.
He also challenged law enforcement agencies to investigate the allegations and bring to book all those involved.
Economic commentator Velli Nyirongo also said the findings underscore deep flaws within Malawi’s public procurement and financial management system.
“The prolonged failure to complete school projects and the substantial overpayments indicate a lack of proper oversight and accountability,” Nyirongo said.
He added that the consistent trend of improper contract management, interest claims and revenue mismanagement highlights a “systemic challenge that must be urgently addressed to safeguard public resources and foster transparent, efficient governance”.
“Addressing these vulnerabilities is crucial for the nation’s progress, particularly for the most vulnerable members of society who bear the brunt of such shortcomings,” Nyirongo said.
Pac has since recommended to the Secretary to the President and Cabinet to follow up on contract management issues, particularly those at the Ministry of Education.
The committee has also urged the Attorney General to ensure irregular additional claims on interests and price adjustment issues are resolved.
