Despite recent audit reports finding flaws in the country’s councils in the way they comply with Public Finance Management Act, investigations by Malawi News have revealed that the councils still have a long way to go to fully comply with the Act.
In our two-week investigations in Mangochi, Dowa and Mzimba, we discovered a number of issues that would result in audit queries.
Questions over Lundu Mini-stadium in Mangochi
In Mangochi, a project that stands out is the construction of a mini-stadium at Lundu.
The project started with K20 million Mangochi Nkungulu received under Community Managed Socio-Economic Project (Comsep). These are funds from the infamous “idle K4 billion” all constituencies were given in the 2017/2018 financial year.
With K14 million spent, what could be seen after the first phase of the project were approximately three layers of blocks around the ground.
Chimwala Area Development Committee (ADC) Chairperson Janet Hassan is astonished.
“The development is good but we are not happy with the way it came. We are not very sure about the money being spent on the stadium. We hear K20 million was made available for the project,” she said.
But Mangochi District Commissioner (DC) Moses Chimphepo said, although the constituency’s MP Aisha Mambo Adams proposed the project, the money was not enough.
“We told the MP that the K20 million would not be enough for the project. We were buying cement blocks from Blantyre and Zomba. Some money was spent on transport. The contractor did the work to a certain level. At some point, there was vandalism at the site. But at the moment, we have allocated some funds to the project. Construction has resumed,” he said.
Adams, who is also Second Deputy Speaker of Parliament, said they started the project with the hope of continuing it in phases, depending on availability of resources.
“That time, the DC advised us that money [K20 million] was not enough. But I said we should start considering that government promised to be disbursing that amount every year. Unfortunately, the following year, it was not released and the project stalled,” Adams said.
She added: “It appears a lot of money was spent on the foundation [of the perimeter fence]. That area is water-logged and they wanted to make sure that the structure is strong.”
Meanwhile, Chimphepo said the council is doing all it can to improve outcome of audits.
“In general, audit queries are reducing compared to what was happening in the past. The only unfortunate bit is that recently three people misappropriated money. They entered the Ifmis [Integrated Financial Management Information System] and got the money. That case is still being prosecuted. If an audit is to be done, that issue is definitely going to appear in the report,” Chimphepo said.
A report delivered during the first meeting of the council’s finance committee held on September 3 2019 states that a preliminary reconciliation of the Other Recurrent Transaction (ORT) account established that K66,901,404.32 could not be accounted for.
Dissatisfaction on the implementation of projects under Constituency Development Fund (CDF), District Development Fund (DDF) and Comsep and doubts over expenditures are not only seen in Mangochi.
The situation is the same in Mzimba and Dowa.
Where is K52.9 million for DDF in Mzimba?
A letter at M’mbelwa (Mzimba) District Council in which one JF Chima was asking the DC for a refund of K52.9 million to DDF has raised suspicion of abuse by the council.
While confirming that indeed K52.9 million from DDF was used for other issues, Director of Planning and Development Precious Kamtsitsi, who is also Mzimba Acting DC, said the money was not lost.
“Sometimes a sector may say, according to cash-flow, they have not received enough funds. Some funds will be borrowed from there and then recovered. Documents show that there was no misappropriation,” he said.
Bridges of Mzimba Solola
At Mzimba Boma, Kavukula- Chanthomba Bridge has become
a source of conflict between M’mbelwa District Council and the constituents of Mzimba Solola.
They allege that the bridge was allocated K6 million in the 2016/17 financial year but nothing was done.
They say it is only until recently, after the community delivered a petition to the council, that some work was done on the bridge.
At Engalaweni, there is growing anger over the construction of Mbale footbridge. In rainy season, children from Engalaweni struggle to go to school.
But the community allege that about K800,000 was already spent.
One of the leaders in Mzimba Urban, Julius Mbale, said what is happening is frustrating.
But the constituency’s MP Jacob Hara said people do not understand what happened on the two projects.
“It is not true that those bridges were ever funded. We had a meeting with the concerned people. Those two projects were earmarked to be funded under Comsep. Maybe the people saw the estimates the council made on the projects. We know they are important projects but, at the moment, no funds have been released for the projects,” Hara said.
Mzimba Human Rights Defenders Coalition Chairperson Teckson Amadu insisted that they are not happy with how the council is handling a number of issues.
“We expect an improvement in service delivery. It is worrisome that we see a number of what we can call projects which are not being completed, yet records from the council show that they were funded and fulfilled,” Amadu said.
A toilet at Mponela Trading Centre: Delays worry community
In Dowa, there is growing impatience over delays in completing construction of a toilet at Mponela Trading Centre.
The project, which is being constructed using K20 million Comsep funds, has stalled.
There are reports that plumbing works are delaying the completion of the project.
Other people blame this on changes in contractors.
Mponela ADC Chairperson Joseph Jason said they are concerned.
“This is a big project in this area. We want to use this toilet for raising funds. The delays will affect that goal,” Jason said.
Director of Public Works in Dowa Oscar Kumwenda said procurement of materials is under way.
“We were purchasing a few plumbing materials. Once that is done, we will finish the project. The contractor who was on the site had some shortfalls and we terminated the contract. People from our office took over. However, the progress was slow. Therefore, we decided to engage a private contractor again,” Kumwenda said.
Trend worries Pac
A Compliance Audit for Local Councils for the year ending June 30 2018 observed that most of the audit findings are recurring and appealed to management of the councils to take issues of accountability seriously as the audit disclosed internal control weaknesses which cut across all the councils.
Among others, the audit found that construction materials for some projects were not delivered and, in some cases, payment was made for no work done or non-existent CDF projects.
Parliament’s Public Accounts Committee (Pac), which recently was following up on issues of abuse of CDF in some councils, has said it is concerned about what is happening in the councils.
Pac Chairperson Ken Kandodo said things will change if what is stipulated in the Public Finance Management Act is followed.
“Generally speaking, there seems to be a culture of impunity. Controlling Officers or civil servants don’t take these regulations seriously because they say ‘nothing will happen to me’. There is really need for government to enforce the current disciplinary measures that are already in our laws. I am sure that, if we do that, a lot of this wastage that we are seeing would disappear,” Kandodo said.
Centre for Social Accountability and Transparency Executive Director Willy Kabwandira blamed what is happening in councils on weak Public Finance Management Act 2003.
“The current Act gives more power to the Minister of Finance, Secretary to Treasury and few selected controlling officers. It does not give power to citizens to provide oversight in public finance management. In addition, the Act does not stipulate stiffer penalties for violations,” he said.
While commending government for amending the Act, he appealed for speed in consultation on the bill so that it is tabled in the next meeting of Parliament.
Recently, a data analysis by Malawi News on the Auditor General’s reports showed that taxpayers’ money over K100 billion has been lost due to corruption and fraudulent payments made from public funds in government ministries, departments and agencies from the last five annual audit reports.