Donors who pool resources into the Health Sector Joint Fund have resumed funding, but have found some beneficiary institutions such as Christian Health Association of Malawi (Cham) facing arrears in excess of K3 billion.
The donors suspended their funding following revelations earlier this year that Ministry of Health lost about K375 million to electronic fraud purportedly at the hands of a foreign agent who operated the basket.
The fraudsters allegedly hacked e-mails of some officials running the fund and an agent, identified as DT Global International Development USA Ltd, ended up authorising payment of 327 000 euro to a newly-opened account.
In an interview yesterday, Ministry of Health spokesperson Adrian Chikumbe said they have only recovered $108 000 from the 327 000 euro (equivalent to $346 709.92).
“We recovered $108 000. The balance will be paid back end this month [September],” he said.
Besides Cham, Banja La Mtsogolo (BLM), which also used to access the resources through government, wants government to pay back what the institution used for family planning services. BLM uses about K100 million monthly.
BLM country director Tenaw Bawoke said in an interview that after the suspension, they devised a system where they used own resources to ensure continuity of service delivery.
He said they use K100 million a month and are discussing with the Ministry of Health to determine how much has been spent.
Said Bawoke: “If we had not made the arrangement, it would have been a crisis. We discussed with the ministry to use own funding and got a guarantee. We are now in discussion with the ministry on reimbursement. I can’t tell exactly how much because we are still working to see how much we have expended.”
In a written response to a questionnaire yesterday, Cham executive director Happy Makala, whose facilities entered into Service Level Agreements (SLAs) with government, said they have accumulated over K3 billion in arrears.
He said: “Arrears amounted to around K2.9 billion for fiscal year 2022-23 and just over K800 million for the current fiscal year. Since resumption, four sets of invoices have been paid amounting to K1.1 billion reducing last fiscal year’s arrears to 21 percent. However, current fiscal year’s arrears have accumulated from K800 million to K1.98 billion.
“Now, total arrears have risen to above K3 billion. However, this year’s reimbursements will be subject to contract signing which among other challenges, there are delays at district health offices due to lack of funding on their part.”
During the suspension, Makala said procurement of drugs and medical supplies was seriously affected, leading to facilities accumulating arrears to their suppliers who have now lost trust in them.
He said the matter is now beyond the board of Cham and they are now seeking the intervention of Episcopal Conference of Malawi and Malawi Council of Churches who run Cham health facilities.
Said Makala: “Cham facilities have now reached a point where they are referring patients to go buy drugs [from private drug stores] as they are unable to sustain enough stock for patients.”
In an earlier memo after meeting Ministry of Health officials, Cham said the ministry committed to contact Treasury as well as the Office of the President and Cabinet to increase government contribution to the SLA pool.
The HSJF, which started in 2015, has been increasing over time from $1.186 million (about K2 051 259 881) in the 2015/16 fiscal year to $19.2 million (about K21 174 295 552) in 2022, according to the Health Sector Strategic Plan III.