7 billion kwacha ‘vanishes’

Ministry of Agriculture, Irrigation and Water Development officials yesterday failed to account for K7 billion expenditure in the 2013/14 financial year, raising fears that the money could have gone down the drain.

Parliament’s Public Accounts Committee (PAC) members said they were not convinced with the explanation from the officials and noted that the expenditure was not reflected in the Integrated Financial Management and Information System (Ifmis), government’s electronic payment platform.

The 2013/14 Auditor General’s report showed that no reconciliation was made during the financial year under review and that some expenditures were not captured in Ifmis; hence, by extension, not reflected in the financial statements.

The audit report said a thorough analysis of captured expenditure data from Ifmis showed that K110 470 063 and K183 676 817 were paid to projects which were off-budget and about K11 billion was not recorded.

Parliament’s PAC sought to find out from the ministry’s controlling officer why no reconciliation was made in the year under review and account for about K7 billion.

In his response, Grey Nyandule Phiri, controller of Agriculture Extension Services who represented the controlling officer (the principal secretary), admitted that the outlined expenditures were not captured in Ifmis because they were off-the budget.

He said only the K7 billion needed reconciliation and not the K4.7 billion reported in the auditor’s report.

Said Nyandule Phiri: “I would like to acknowledge that indeed the auditors found that some expenditure was not captured in Ifmis and by extension not reflected in the financial statements.

“I wish to inform you that after thorough analysis of captured expenditure data from Ifmis of the expenditures K110 470 063 and K183 676 817 were for Carla and APPSA projects respectively which were off-budget.

“Further to the above, an amount of K7 010 084 314 was the actual figure captured in Ifmis and not K4.7 billion as reported in the Annual Auditor General’s Report.”

He said his ministry has since written the Auditor General to request for removal of these amounts (on projects off budget lines) in the Annual Auditors General Report.

However, his explanation did not impress the committee members who said there was lack of seriousness.

Mangochi Masongola MP Rashid Msusa Pemba said it was doubtful if the money that is not recorded in the Ifmis is going to be reconciled let alone be recovered.

Rumphi East MP Kamlepo Kalua, who is also the committee’s vice-chairperson, said the matter was serious and suggested that it was high time Parliament started acting on such malpractices and ensure that errant public officers are brought to book.

He said: “Are we serious that the figure K7 billion cannot be reconciled? It is high time we expose such laxity and some of us are tired with this behaviour and we are ready to expose such people.”

Committee chairperson Alekeni Menyani said the anger among the MPs was justifiable as the authorities that be, who are mandated to follow up such issues, do not do so and take time.

In an interview after the meeting, Menyani said they will lobby for more action from institutions such as the Anti-Corruption Bureau and Malawi Police Service to take up the issues and prosecute those in the wrong.

Ironically, the period currently being reviewed is when Cashgate—the plunder of resources at Capital Hill—was exposed.

During the period, then resident Joyce Banda instituted a forensic audit undertaken by British firm Baker Tilly which, over a randomly selected period of six months covering April to September 2013, established that K24 billion was siphoned from public coffers through dubious payments, inflated invoices and goods or services never rendered.

In May 2015, a financial analysis report by audit and business advisory firm PricewaterhouseCoopers (PwC) established that about K577 billion in public funds could not be reconciled between 2009 and December 31 2014.

Later, a forensic audit by RSM Risk Assurance LLP of the United Kingdom revealed bid rigging linked to businesses owned by at least five families and that the widely quoted K577 billion was incorrect. The amount to be reconciliated over the period was thus reduced to K236 billion.  n