K7bn suspicious expenditure at Ministry of Agriculture: Malawi MPs irked

Officials at Malawi’s Ministry of Agriculture, Irrigation and Water Development got the members of the Parliamentary Public Accounts (PAC) angry after they failed to explain how they could not account for a whooping K7 billion expenditure with the members fearing that the money could have gone into people’s pockets rather than used for government activities.

According to an audit report for the 2013/2014 financial year, the huge expenditure was not reflected in the government’s electronic payment platform, the Integrated Financial Management and Information System (Ifmis) and even in any of government financial statement with no reconciliation made on the expenditure.

During the meeting with the officials on Thursday, PAC members expressed anger and dismay saying that they were not convinced with the explanation from the Ministry’s officials.

Mangochi Masongola MP Rashid Msusa Pemba said it was doubtful if the money that is not recorded in the Ifmis is going to be reconciled let alone be recovered.

Rumphi East MP Kamlepo Kalua, who is also the committee’s vice-chairperson, said the matter was serious and suggested that it was high time Parliament started acting on such malpractices and ensure that errant public officers are brought to book.

“Are we serious that the figure K7 billion cannot be reconciled? It is high time we expose such laxity and some of us are tired with this behaviour and we are ready to expose such people,” said Kalua.

PAC Chairperson Alekeni Menyani said the anger among the MPs was justifiable as the authorities, who are mandated to follow up such issues, do not do so and take their time.

“As PAC we think that this is time for us tol lobby for more action from institutions such as the Anti-Corruption Bureau and Malawi Police Service to take up the issues and prosecute those in the wrong because this is really unacceptable,” said Menyani in an interview after the meeting.

The 2013/14 Auditor General’s report showed that no reconciliation was made on the expenditure and that some expenditures were not captured in Ifmis; by extension, not reflected in the financial statements.

The audit report said a thorough analysis of captured expenditure data from Ifmis showed that K110,470 063 and K183,676,817 were paid to projects which were off-budget and about K11 billion was not recorded.

In his response to the queries raised by PAC members, Controller of Agriculture Extension Services Grey Nyandule Phiri, who represented the controlling officer, the principal secretary in the ministry, admitted that the outlined expenditures were not captured in Ifmis because they were off-the budget.

He said only the K7 billion needed reconciliation and not the K4.7 billion reported in the auditor’s report.

“I would like to acknowledge that indeed the auditors found that some expenditure was not captured in Ifmis and by extension not reflected in the financial statements. I wish to inform you that after thorough analysis of captured expenditure data from Ifmis of the expenditures K110 470 063 and K183 676 817 were for Carla and APPSA projects respectively which were off-budget,” said Nyandule Phiri.

He said an amount of K7,010,084,314 was the actual figure not captured in Ifmis and not the other K4.7 billion as reported in the Annual Auditor General’s Report.

He explained that his ministry has since written the Auditor General to request for removal of these amounts on off-budget lines projects in the Annual Auditors General Report. However, his explanation did not impress the committee members who said there was lack of seriousness.

These unreconciled expenditures raise eyebrows even more considering that this was the time when the plunder of public resources at Malawi’s Capital Hill-commonly referred to as Cashgate-was exposed.

A forensic audit undertaken by British firm Baker Tilly covering April to September 2013, established that K24 billion was siphoned from public coffers through dubious payments, inflated invoices and goods or services never rendered.

In May 2015, a financial analysis report by audit and business advisory firm PricewaterhouseCoopers (PwC) established that about K577 billion in public funds could not be reconciled between 2009 and December 31 2014.

Later, although a forensic audit by RSM Risk Assurance LLP of the United Kingdom concluded that the widely quoted K577 billion was incorrect and the amount was thus reduced to K236 billion, the audit confirmed a big plunder of public resources.

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