Govt owes Saccos over K300m

Malawi Union of Savings and Credit Cooperatives (Muscco) says government is yet to remit over K300 million (US$810 810) of unlimited payroll deductions to its savings and credit cooperatives (Saccos), a situation which is affecting Sacco membership.

Muscco chief executive officer Sylvester Kadzola disclosed this in an interview at the International Sacco Day Celebrations in Karonga on Saturday.

Kadzola said government has not been remitting the money it deducts from the members’ salaries on behalf of the Saccos since January this year.

“We have made several petitions to government on this but the problem has not been solved. This has affected us such that many Saccos are not able to offer services to their members.

“The Saccos have now resorted to borrowing from Muscco so that they may keep their Saccos running but this is more expensive than when they are to use their own resources,” he said.

He said the problem is critical in the ministries of Education, Science and Technology and Agriculture and Food Security.

Sacco chapter three director Kennedy Moyo said failure by government to remit the money has tainted the image of Saccos such that new members are not willing to join.

“Our accounts are dry such that we are unable to lend out money to our members. This prevents others from joining,” he said.

Ministry of Finance spokesperson Nations Msowoya in an interview on Sunday said the Treasury has to make a thorough reconciliation with the ministries that entered into agreement with the Saccos to find out if they were remitting the money into government’s account number one.

“The Saccos entered into agreement with the ministries individually. This means we need to find out first if the ministries were remitting the money to government. If that’s the case then we have to refer the issue to Parliament so that the money is remitted to the Saccos. If not, then we have to trace where the money has gone,” said Msowoya.