Malawi’s Minister of Finance Ken Lipenga says weak control systems within the government expenditure mechanism are costing Malawi heavily through fraud and unnecessary waste of resources.
Speaking when he presented new government expenditure control measures yesterday in Lilongwe, Lipenga specifically pointed out that a lot of resources are being lost through the Integrated Financial Management Information System (IFMIS) which he said has a number of weaknesses to effectively safeguard public finances.
However, Lipenga could not say how much government is losing, saying it is a substantial and worrying amount that needs to be checked if the country is to progress towards economic recovery.
“We introduced IFMIS to promote accountability. But there are number of weaknesses that have led to fraud and waste of resources. As a result, it is necessary to put in place additional control measures to prevent malpractice and protect public financial resources,” said Lipenga.
He said to check the weaknesses in the IFMIS, government will engage an independent auditor to electronically check the whole system on regular basis to detect any irregularities.
Lipenga said already a number of modifications have been done to the IFMIS and in the coming months’ focus will be to ensure that the system captures complete financial transactions speeds up in posting of data, prevention of using manual systems and provision of validation, and system integrity checks, alerts and financial reports.
“We will also have to consider whether the weaknesses that have been highlighted can be addressed by upgrading the IFMIS or whether we should consider replacing IFMIS,” added Lipenga.
He said the ministry will work closely with the Office of the President and Cabinet, the Director of Public Prosecution and other stakeholders to ensure that appropriate punishments and sanctions are meted out to anyone found to have contravened these rules and regulations.
Lipenga said, among several measures, internal auditors will be pre-clearing all payments above K500 000 (about $1 250) and that registers will be introduced to link funding and cheques issued while all cheques will be endorsed to signify that they have been entered in the register.