Indigenous contractors end vigil, vow to fight on
Indigenous contractors under Malawi Building, Civil Engineering and Allied Trade Association (Mabcata) have said they will not relent in their push for the Roads Fund Administration (RFA) to pay over K50 billion the fund owes them.
Mabcata vice-president Kondwani Kadango said this in an interview on Sunday when asked to comment on the group’s next course of action following a vigil the contractors conducted at RFA offices in Lilongwe from Tuesday to Thursday.
“We are currently talking with the Principal Secretary for Transport and Public Works who is discussing the matter with Treasury.
“We are also waiting for the Secretary to Treasury [ST] to return from a foreign trip to engage him on the matter after which we will bring the committee of Parliament responsible for public works, the ST and the Ministry of Transport to a roundtable to resolve this matter.
“Should these efforts fail to yield results, we will engage an extra gear until RFA pay what they owe us,” he said.
Kadango also expressed frustration over the Road Authority’s (RA) decision to award new contracts despite the RFA’s failure to settle existing debts, including escalated costs following the 44 percent devaluation of the kwacha effected in November last year.
He said: “Contractors should not bear the financial responsibilities of the government. When a contractor undertakes a project, they use their own resources and expect timely payment from the government.”
But speaking in an earlier interview, RFA spokesperson Masauko Ngwaluko acknowledged that the delay in payments is due to the Malawi Energy Regulatory Authority’s failure to remit the road maintenance levy.
He also said the dynamics of fuel pricing have resulted in the current situation.
However, Ngwaluko clarified that RFA owes indigenous contractors implementing RA projects K11.8 billion.
But Kadango said the outstanding amount reached K50 billion when they factored in a 40 percent increase in project cost escalations following the devaluation of the kwacha.
He said RFA only paid 15 percent to cushion the effects of the devaluation instead of 40 percent; hence the discrepancy.
On May 21 2024, the indigenous contractors also presented a petition to RFA demanding outstanding payments which at that point had accumulated to over K45 billion.
