The cost of business as usual

One of the major reasons Malawians are suffering—terrible social service delivery in areas such as health, education, water and sanitation; poor infrastructure, the widening gap between the rich and the poor, static poverty levels and underdevelopment in general—is because of how the system has allowed those entrusted with the management of public resources to misuse them either through sheer incompetence or fraud and corruption.

We still have a third of the national budget wasted through fraud and corruption, according to the office of the Director of Public Prosecutions (DPP). Yet, this is a country of laws, including those that govern public finance management such as the Public Finance Management Act, the Public Audit Act, the Public Procurement Act, Treasury Instructions and even the Republican Constitution, among several legal provisions that Parliament passed, but whose implementation is half-hearted at best.

Take, for example, the Public Finance Management Act. It stipulates clearly the responsibilities of controlling officers.

Among several responsibilities of controlling officers as outlined in Section 10 of the Public Finance Management Act, there is one provision in subsection 1 (f) that I find to be very important.

It says that each controlling officer is responsible for ensuring that, in relation to his or her Ministry, “there is no over expenditure or over-commitment of funds and a review is undertaken each month to ensure that there is no such over-expenditure or over-commitment”.

Section 87 of this Act states that where a controlling officer or chief executive authorises expenditure or commitment of funds in excess of the approved limit or commits or expends funds where there is no appropriation permitting such expenditure, the appointing authority may suspend without pay the controlling officer or chief executive with effect on and from the date on which the Secretary to the Treasury certifies the unauthorised expenditure or commitment.

The appointing authority, in this case, the State President, can even fire the head of the Ministry, Department or Agency (MDA). But how many times have MDA heads overspent or over committed and gotten away with it?

History shows us that almost every one of them has gotten away with so much of such disregard of the law that it is now normal to overspend. Yet, again history tells us, it is this lack of enforcement of spending limits that bred Cashgate in which at least K236 billion is suspected to have been stolen in the five years leading up to December 2014.

Even where an MDA did not have the money to spend, there was always a standing instruction from the Reserve Bank of Malawi (RBM) to commercial banks telling them to honour government cheques even when there was no money in a bank account.

It is such shameless recklessness that led to the biggest heist at the Ministry of Tourism, Ministry of Local Government and Rural Development, the Malawi Defence Force (MDF) and even Malawi Police, among others.

It is the lack of respect for the Public Finance Management Act that embodied accountants and information technology experts to move billions into an MDA account way above its approved allocation and have it encashed within days in form of payments for jobs never undertaken; without raising flags.

Because if the system were to respect laws, it would be obvious that an MDA account had received much more than was approved, an observation that would ordinarily raise alarm bells and spark investigations.

But that never happened until hundreds of millions of kwachas were discovered in car boots leaving Capital Hill in haste; some of the huge cash was in ceilings of the mansions the owners built with the same ill-gotten money.

And without a more improved Ifmis yet to be purchased and procured over four years since the climax of Cashgate, there is a strong possibility that between January 2015 and to date, the taxpayer has bled billions of kwacha.

I mean, how do you explain the failure to buy the accounting system in roughly four years when the administration had put it as a priority? Who has been resisting this change? Who has been benefitting from the status quo?

The Public Procurement Act is another one that has been ignored to a level of being turned into toilet tissue. The procurement crap at the Electricity Corporation of Malawi (Escom) is testimony to that.

Even when the Office of the Director of Public Procurement directed that the processes and methods of procurement were irregular and that the buying should not proceed, folks at the now near bankrupt power utility went right ahead to get staff, some of which would not even be used over a 10-year period, but cost the parastatal billions.

The question is: Where is the appointing authority in the middle of all this mess? Most likely in a business as usual mode somewhere in a taxpayer-funded house.

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