Proposed amendments to the Press Trust Reconstruction Act of 1995 are expected to help widen the scope and net flows for the fund, insiders have indicated.
Responding to The Nation questions following the Press Trust Reconstruction (Amendment) Bill of 2022 set to be tabled in Parliament during the ongoing Budget Meeting, Press Trust chief executive officer Gibson Ngalamila and trustee Audrey Mwala in separate interviews said the amendments would put the Trust in a position to generate more resources for investments.
The Bill seeks to revise the minimum allocation for distribution to ensure retention of adequate funds for reinvestment so that the trust’s capital is not depleted by excessive distribution and enable the trust to support its investments by borrowing or guaranteeing borrowing by its subsidiary and associate companies.
It also seeks to reduce the term of office for trustees from six years to five years and make provision for reasonable allowances to be paid to trustees in recognition of the time and effort they devote in administering the trust.
Besides, the Bill also seeks to enhance the penalty for contravention of the Act that has remained static since the enactment of the Act in 1995, empower the minister to amend Schedules to the Act, other than the Deed of Variation as well as make better provision for qualifying criteria for persons to be appointed as trustees.
In an interview yesterday, Ngalamila said trustees of the fund saw the need to amend some of the clauses in the act enacted in 1995 to be in line with the corporate governance framework of the day.
He said: “Once the Bill is passed, we will have a better enabling registration for the fund.
“It will also enhance our activities as it will mandate us on how to continue to invest and grow the fund for more future investments to do more social projects and enhance governance framework.”
On her part, Mwala, a former board chairperson of Press Trust, said the amended Act could help the Trust generate more money for investments as before the amendment, the trustee was spending more than it was investing.
“The way it was before, it was constraining the ability of Press Trust to invest money. With this development, it means they can make more money for future investments,” she said.
Press Trust was formed in 1982 by founding president Hastings Kamuzu Banda as a platform to provide charitable donations which are in the interest and for the benefit of the people of Malawi, including the advancement of their education, health, social welfare and housing.
In addition, the trust has over the years funded projects in additional sectors such as sports, culture, scientific research, disaster relief and environmental conservation.
The Press Trust is made up of two subsidiaries, namely, Press Trust Overseas Limited, an investment company, and Press Agriculture Limited, an agricultural company.
Press Trust has significant investments in four companies, namely, Press Corporation plc, Blantyre Hotels plc, Continental Holdings Limited and Mwaiwathu Private Hospital Limited.
Furthermore, Press Trust has also invested on the Malawi Stock Exchange.
In the year ending March 31 2022, the trust committed K2.047 billion in project funding and donations to about 44 institutions, mostly in the health and education sectors and realised a surplus of K1.358 billion, up from K595 million posted the previous year.
At the reporting date, the Trust had net current assets of K2.125 billion, up from K515 million the previous year.
