Britain to withhold K17bn

Malawi has lost out on 27 million pounds (about K17.8 billion) which the country’s bilateral partner, Britain, was expected to disburse by December this year as part of its sector support to health, education and agriculture.

The decision to delay disbursement of the funds has been made following revelations of theft of billions of public funds at Capital Hill.

Britain’s Department for International Development (DfID) head in Malawi Sarah Sanyahumbi told the media in Lilongwe yesterday that Britain had planned to disburse about £115 million between April 2013 and March 2014, £27 million for the October to December, 2013 quarter.

“The funding that is being delayed at the moment amounts to £27 million. So on current prospects, we will be spending £84 million if it is not possible to resume support to the Government of Malawi by the end of March,” Sanyahumbi said.

Sanyahumbi said the decision to delay was out of their hands because they could not put money in system that was leaking.

However, Britain has not disbursed budgetary support since suspension in 2011, except for an emergency budgetary support in December last year.

Donors contribute about 40 percent towards the national budget, apart from other contributions towards transport, water, health and education sectors.

Sanyahumbi said donors have been taken by surprise at the extent of theft in government just a few months after former minister of Finance assured the donors that loopholes in the financial management systems were being sealed.

“Donors are shocked, but I think everyone in Malawi is shocked at the extent of the revelations that we have heard. We have been raising concerns about public financial management systems for a long time and we had programmes in place for several years that we had hoped were adjusting these weaknesses, but clearly from what we are hearing now would suggest what we have been doing hasn’t been effective,” she said.

The Common Approach to Budgetary Support (Cabs) group of donors has since asked government to draft a revised budget which Parliament would have to approve and offered to provide technical and financial assistance towards government’s action plan.

The donors have identified an international firm of forensic auditors, will support strengthening of the Integrated Financial Management Information System and provide technical advisers and lawyers to Anti-Corruption Bureau to assist with investigations into Cash-gate.