Analyst says Goodall’s raising of controversial K4bn fund to K6bn signs of executive arrogance

 A renowned governance commentator Makhumbo Munthali has described Malawi  government’s decision to reallocate the controversial K4 Billion ‘miracle’ money fund to Area Development Committees –unlike the Constituencies- and proposing  an increase of the fund to K6 billion in the 2018/19 National Budget before all issues pertaining the funds as raised by Civil Society Organisations (CSOs) in their 27 April demonstrations petition are resolved as an act of “executive arrogance”.

Thousands of Malawians led by CSOs under the burner of Human Rights Defenders Forum took to the streets on 27 April 2018 to protest the K4 Billion ‘miracle’ money fund which was allegedly earmarked by government to reward Members of Parliament who had rejected the electoral reforms including 50%+1 of electing the President.

Amongst the 10 demands the CSOs and the citizens directed to the President was the firing or resignation of the Minister of Finance Goodall Gondwe and Minister of Local Government Kondwani Nankhumwa within 15 days over their dubious role in the K4 Billion scandal.

“Government is proposing to commence another funding window for rural development that could service some 300 area amount of K6.0 billion has been earmarked for this purpose,” Gondwe told parliament.

However, a Mzuzu-based governance analyst Makhumbo Munthali said that government’ decision to proceed with the reallocation of the money to ADCs in the absence of addressing the issues raised in the CSOs petition relating to the money was a sign of bad governance and executive arrogance.

“As you are aware the Civil Society groups raised a number of issues and demands which required government’s action relating to the controversial K4 Billion scandal. And most of these issues centred on questions as regards to the accountability and integrity of the government machinery and the responsible political figures – in this case the Minister of Finance and Local Government – in view of this scandal.

“For example, one of the issue was for ACB to expedite investigations of both K4 Billion scandal and its alleged linkage to the rejection of electoral reforms. It is on record that ACB announced that it would effect investigations into the same. But before all these matters are concluded and addressed by government and ACB we see a government continuing to allocate these monies to ADCs – a scenario that raises more questions than answers. Why the hurry?” – wondered Munthali.

Munthali added that under the ideal situation government was supposed to either cancel or suspend this allocation within the existing legal, policy and institutional framework pending conclusions to all matters and concerns as raised by the CSOs in their 10 point demands.

“After all, we were told that the K4 Billion fund to constituencies was a mere surplus – in this regard not a priority. This against the background that government has made cuts to several allocations in the current budget means that doing away with this allocation would do more good to our already highly squeezed budget. This is besides the fact that the current budget as already presented by the Minister of Finance already have several allocations that support local development within the existing legal, policy and institutional framework of fiscal decentralisation. In this regard, it would be weird to allocate funds outside the existing framework – funds whose intent and origin remains suspicious and unresolved,” he said.

Munthali said apart from cancelling such a fund (through Parliament), it is also incumbent upon both the Minister of Finance Gondwe and Minister of Local Government  Kondwani Nankhumwa  to resign from their positions to pave way for smooth investigations into the matter over their alleged corrupt role in the scandal.

2 As rightly observed by CSOs, the K4 Billion Scandal has raised more questions than answers on the integrity of not only the Ministers implicated but also the government, as such it has to be treated with the urgent seriousness it deserves rather than the executive arrogance we continue to see”, said Munthali,

The governance expert further faulted government plan of transferring the K4 Billion funds directly to the Area Development Committees arguing that this was a clear executive attempt to undermine the existing District Development Planning system and framework as supported by both the Decentralisation Policy and Local Government Act.

“In its attempts to score a political point and save its face in the midst of the K4 Billion dubious scandal government is resolving unlawful means of transferring these funds – attempts that defeats the whole essence of decentralisation. Under the current District Development Planning system and process, government cannot directly disburse funds to Area Development Committees. In fact, each district has a District Development Plan (DDP) which clearly detail the development priorities and needs of that particular district, and for this DDP to be developed it follows the bottom-up approach where needs are identified from the VDCs level then taken to ADCs before consolidated in the DDP which is approved by the full Council (including councillors).

“And the various legally supported development funds targeting the districts eventually are aimed at implementing the DDP. So by sending the money direct to the ADCs – in fact, in the absence of clear developed guidelines- the executive is not only undermining the DDPs and decentralisation but also promoting a culture of abuse especially considering the fact that most ADCs in Malawi lack capacity to monitor and track the various budgets. This is where MPs – who are also members of ADCs – will take advantage of such ignorance in order to monopolise the whole process,” Said Munthali.

Munthali further warned that in the absence of clearing all the issues pertaining to the K4 Billion scandal, continuing to disburse the money would be morally sending a wrong signal.

“In the absence of clearing all the corruption related allegations relating to the K4 Billion scandal including that of the fund being initially earmarked to reward those MPs that rejected electoral reforms, the message that would be indirectly sent to the ADCs is that the MPs who rejected the electoral reforms had now brought development which would benefit all, and as such, contrary to the public rebuke, it was important that MPs rejected such reforms so that the communities should now be rewarded K4 Billion. Morally this would be sending a bad message”, argued Munthali, formerly National Secretary of the Ethics, Peace and Justice Commission of Evangelical Association of Malawi.

Malawi Congress Party spokesperson on finance Kusamba Dzonzi, also bashed the whole idea of introducing a new financing window specifically targeting ADCs.

He argued that the district development plan was all encompassing as it included development agenda for ADCs hence there was no need to have a new window of funding at ADC level in the presence of District Development Fund (DDF), Local Development Fund (LDF) and Constituency Development Fund (CDF).

Dzonzi further observed that there is likely to be high level abuse because of the direct involvement of chiefs in the running of ADCs.

Lilongwe-based political and governance analyst Henry Chingaipe also questioned the rationale of introducing an extra window of funding when existing ones are continuously marred by maladministration.

 “It is a proposal and my prayer would be that Parliament rejects it. We have DDF, CDF we have LDF and we have already been saying the multiplicity of funding windows encourages waste and duplication of efforts and it is very inefficient. We are unable to track impact,” he argued.

Centre for Development of People (Cedep), one of the CSOs which petitioned government to cancel the controversial fund during the nationwide protests last month, said the bringing back of the controversial fund in the budget is not a response but an outright open defiance to the citizen’s call.

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