Chewing straw on K236 bn Cashgate

Hon Folks, trending on the social media this week were two issues about Malawi. First was that at 225.50 USD, Malawi is the poorest country by gross domestic product (GDP) per capita.

Second were names of some companies implicated in the K236 billion Cashgate between 2009 and 2014—the period when Democratic Progressive Party (DPP) under Bingu (2009-12) and Peoples’ Party (PP) under Joyce Banda (2012-14) served on the government side of the political divide.

The two issues—Cashgate and poverty—have a cause, effect relationship.

During the period under review, Cashgate alone was robbing Malawians an average of K47.2 billion a year or K3.9 billion per month. Yet the Arthur Peter Mutharika (APM) administration has never really accepted the prevalence of Cashgate during the reign of Bingu, APM’s brother.

But shocking as it is, there was also the non-Cashgate form of corruption taking place concurrently which, together with botched contracts and inefficiency, was robbing the taxpayer 30 percent of public revenue.

Ambulances were still being used as taxis, traffic police were still pocketing bribes and chiefs were still bidding for their rulings. Immigration officers were still being palm-oiled for services rendered and procurement officers were still exacting commissions from favoured suppliers.

Public sector jobs were still being given to well-connected people through the backdoor and government was still dumping ground for substandard goods and services charged at twice the market value or more.

What Cashgate did was to take corruption to another level—the level where networks were established between fat-cats in government and their political masters on the one hand and service providers on the other through which government cheques were issued and processed through the latter’s bank accounts at a commission of around 10 percent.

This is a picture that emerged from the testimony of convicted businessman Osward Lutepo who netted something close to K500 million within a month as a thank you for allowing his business accounts to be used for the siphoning of K4.7 billion from public coffers.

From Lutepo’s account, he was dealing with a certain senior government official who had direct links to JB. Interestingly, while Lutepo is serving time for his part in Cashgate, those in government who purportedly engineered it and pocketed 90 percent of the loot are not even being investigated or at least we have not heard anything about such probe.

Instead, the government side appears to have made political capital of Lutepo’s allegations since JB has remained abroad, a fugitive, for fear of being arrested should she return home. That has led her PP to crumble, giving a chance to United Democratic Front (UDF), an ally of DPP, to make the Eastern Region its stronghold.

Malawians will be feeding on straw by training their focus on businesspersons mentioned in the forensic report. Let them get the justice they deserve but we all know that businesspersons on their own cannot make Cashgate happen. The kingmakers are on the government side of the Cashgate equation since it is them who have powers to manipulate government systems.

Where are they in the K236 billion Cashgate scam? Not a single one? Why then expose business persons who probably got a mere 10 percent while protecting those in government who facilitated the loot and got up to 90 percent of it?

APM and his government were upbeat when the Baker Tilley forensic audit of six months of JB’s rule exposed that Cashgate had eroded over K20 billion from public coffers. They made sure JB got smeared by it.

The K236 billion Cashgate encompasses a period when APM and the majority of the Cabinet were in government. It also happened to be a period when, according to valuers government engaged to assess the estate of the late Bingu wa Mutharika, it was established that within the eight years he served as State President, Bingu had amassed assets valued at over K61 billion!

In light of the suffering, deprivation and excruciating poverty currently rocking the Malawi nation and the raw deal they get from government’s commercialised service delivery in exchange for the taxes they pay out of their ever dwindling incomes, the least those in government could have done is to engage an extra gear to clear the mist, fish out the culprits and let the law take its course.

Instead, its life as usual in government while half the population is starving, Malawi is rated the poorest country by GDP per capita and Escom which adopted an automatic pricing system is in turn  giving its customers 10 to 14 hours of blackout a day. n