Malawi’s diplomatic missions have squandered K2.6 billion of public funds through a litany of illegal expenditures, violating the new Public Finance Management Act of 2022, an Auditor General’s report has revealed.
The report, covering the year ended March 2023, exposes systematic financial abuse across four missions of Tokyo in Japan, New Delhi in India, the UN Mission and Pretoria in South Africa.
New Delhi accounted for the lion’s share of the abuse as auditors found K1.8 billion spent on health services without signed contracts.
According to the report, payments totalling K54 031 657 04 were made to BLK Hospital without counter signatures of the patient or guardian on the bills or invoices.
Reads the report in part: “As a result, it was difficult to ascertain the validity of the payments… An inspection of payment vouchers and related documents revealed that the commission made payments amounting K14 087 952 31 in respect of patients’ allowance without basis. This could lead to loss of public resources.”
It further states that the embassy in Tokyo illegally transferred K236.5 million from visa accounts without the written approval of the Secretary to Treasury, adding that it treated a Holding Account 8461316 like personal cash and spent K248 million.
Again, the Malawi Permanent Mission to the UN illegally shifted K87.2 million between its ORT and PE accounts without prior Treasury authority and there is no evidence that the funds were refunded.
It also misallocated K18.7 million from the ORT account to pay temporary diplomats, bypassing Treasury approval for such transfers.
In Pretoria, the embassy procured goods worth K107.8 million without the Internal Procurement and Disposal Committee’s (IPDC) approval, violating procurement laws.
Auditors also found that payments worth K72 298 934.50 were not supported with necessary documents such as loose minutes, invoices, delivery notes and receipts.
The report reads: “In the absence of the documents, it was difficult to ascertain the authenticity of the transactions… Subsistence al lowances amounting to K12 951 150 00 were paid to staff for attending meetings and election observer missions.”
Mini s t r y of Finance spokesper son Wi l l iams Banda said the audit covers 2021/2022, the same year the Public Finance Management Act was enacted.
He said: “We are cautiously reviewing the issues to avoid being caught on the wrong side of the law. In this regard, we are engaging the Public Accounts of Parliament, the Auditor General and the Attorney General, considering that the report was issued in a transitional period.
“Furthermore, IFMIs is being migrated and domesticated to all missions.”
Ministry of Foreign Affairs spokesperson Charles Nkhalamba said he needed more time to finalise consultations.
