Eight years of CDF: Any hope?

New data from Round 5 of the Afrobarometer collected across an unprecedented 34 African countries between 2011 and 2013 shows that after a decade of economic growth in the continent, there has been little change in poverty levels across the continent.

This, reasons Afrobarometer, suggests that growth is occurring, but that its effects are not trickling down to the poorest citizens. In fact, income inequality may be worsening.

But in Malawi, one of the countries where Afrobarometer did its research, there are a number of interventions aimed at trickling down growth to the poorest citizens.

Constituency Development Fund (CDF) is one such intervention. Hatched in 2006, CDF funds are meant to finance minor development projects, among others, construction of bridges, boreholes and houses for civil servants.

In fact, a 2006 policy paper for CDF argues the fund is there “to respond to immediate, short-term community development needs and is a means of ensuring that rural development spreads evenly throughout the country”.

In eight years, CDF, which is entrusted in the hands of members of Parliament (MPs), has risen, in terms of allocation, from an annual K1 million (about $2 500) in 2006/2007 financial to the current K7 million (about $17 500) for each constituency. In other words, the allocation has risen from K193 million (about $483 500) to K1.3 billion (about $3.2m).

However, with revelations that growth is failing to trickle down to the poorest, yet the CDF came about to achieve just that, what does this mean? Does this suggest that CDF is wanting?

Making a difference

Unarguably, this is a question with mixed responses. On one hand, CDF, in some constituencies is making a difference. For instance, in August this year, the CDF was used to build teachers’ houses somewhere in Mlangeni in Mangochi.

However, such positive instances of CDF are only a drop in the ocean in terms of its failure.

For instance, take a travel to Chididi—a cluster of four group village heads and 33 villages, located 26 kilometres west of Nsanje Boma.

It is hilly and rocky, the road is narrow, bumpy and coils in the hills of a dense forest, sometimes passing over rivers that have no bridges. All this makes travelling difficult even within the villages. In fact, travelling from Nsanje to Chididi, there is hardly a means of public transport linking the two. People are usually seen walking to the boma.

Not only that.

According to Group Village Head Mchacha, a number of villages in Chididi do not have access to safe water.

“We do not have enough boreholes here. The few available do not function. They broke down a long time ago,” he says.

He adds that apart from being a community without a health centre (the nearest is the district hospital at the boma), access to quality education is a challenge.

“We have a few primary schools. But even among the few schools we have, we do not have teachers’ houses. We keep losing teachers to other schools,” he complains.

Better social services

It is not just locals in Chididi who are complaining of failing to access better social services due to the absence of things that CDF can buy.

This is a national outcry. In fact, it really questions what is happening to CDF.

In December 2011, the office of the Auditor General released the first comprehensive audit report on CDF funds.

The report, which audited accounts of district councils for 2006, 2007 and 2008, showed that about K107 million (about $267 500) was spent without approval of internal procurement committees (IPC) at Salima, M’mbelwa, Karonga, Nkhata Bay, Mulanje and Phalombe district councils.

In other words, according to Rockford Kampanje, the then Auditor General, the CDF is ‘being heavily abused’.

Of course, since then, there has not been any comprehensive report regarding CDF.

However, this hardly suggests anything positive. Early this year, MPs from Ntcheu District formed a task force which queried the district council to refund in instalments the K11 million (about $27 500) meant for seven constituencies for projects under CDF.

The funds were said ‘to have been diverted to other projects’.

Following the diversion of the money, some contractors were forced to abandon projects for non-payment of their dues, a situation that forced some MPs to use money from their pockets.

Despite such administrative challenges, a sitting MP within the city of Blantyre who opted for anonymity, argues that CDF is MPs money for campaign.

“Let’s be honest. CDF funds are completely in the hands of us, sitting MPs. Often we do not use it to facilitate development in our area. Development is secondary and often, incidental. This is the money we, MPs, use to strengthen our position in the constituency,” he said.

What the MP is advancing is not different from insights of policy and development specialist Blessings Chinsinga, who argues in an article titled The Interface between Local Level Politics, Constitutionalism and State Formation in Malawi through the Lens of the Constituency Development Fund (CDF).

Bargaining tool

After refusing to pass the 2006/2007 national budget, writes Chinsinga, the opposition MPs used the passing of the budget as a bargaining chip to force the government to bow down to the demands for a CDF.

Taking advantage of their dominance in Parliament, the opposition insisted that they would pass the budget only if the CDF was accommodated. One parliamentarian described the CDF as “a tool that we used to bargain with government to have the budget passed. So, they gave us CDF and we passed the budget”.

“The pressure by opposition political parties to force government to hold local polls was never been so great and sustained as it were before the establishment of the CDF in the 2006/07 fiscal year.

“The argument of most observers is that the establishment of the CDF has tremendously pacified the parliamentarians across the political divide because it serves their selfish political interests that are central to building a potentially successful political career without having to dig deep into their own private vaults,” writes Chinsinga.

Management laws and procedures

He adds that the pressure to establish the CDF was so great that the government proceeded to implement it without sufficiently thinking through the requisite legal and administrative arrangements.

“For instance, there is as yet no legal basis to subject the CDF resources to the ensemble of public funds management laws and procedures as specified in the Public Financial Management Act (PFMA) (2003); the Public Audit Act (PAA) (2003); Public Procurement Act (PPA) (2003); and the Corruption Practices Act (CPA) (1995).

“It is, therefore, not surprising that cases of abuse of CDFs by both the MPs and district council officials have been rampant. They know that they can get away with cases of mismanagement because there is no legal basis to prosecute them,” he writes.

He also notes that it is, therefore, not surprising that Parliament has not moved in to tighten the glaring shortfalls in the logistical, administrative and legal shortfalls in arrangements governing the CDF.

“The ensemble of the public financial management laws cannot be applied fully to the CDF because it has been merely promulgated by a parliamentary administrative decision.

“The inaction on the part of MPs could be attributed to the fact that they view [the CDF] as an investment in their political careers, with returns spread out over the electoral cycle.

“The CDF has, therefore, widely been described as a very good example where formal institutions are exploited to sort out informal deals outside the formal governance framework to bolster selfish political goals,” he writes.

Should it be a surprise that CDF is failing to act as a medium of tricking growth rates to the poor?