Malawi’s influential newspaper published on Saturday, Weekend Nation, has used its editorial comment to add credence to experts suggested best practices to ring fence the Reserve Bank of Malawi (RBM) from abuse owing to its legal framework which provides that the central bank’s head, the governor, should also double as its board chairperson.
The paper made the editorial comment in an extended coverage to the recent revelations of ‘abnormal remunerations’ at the RBM where the bank’s former governor Dalitso Kabambe’s salary is said to have more than tripled between 2017 and 2020, let alone the salaries for the bank’s directors also shot up exponentially during the same period.
Kabambe in an interview on Zodiak TV defended his K24 million monthly salary saying it was decided by the Board of the Bank and it was based on his years of service and performance in the Bank.
According to him, RBM-which is a lender of last resort-remains a crucial player in regulating the country’s economy, “as such this is a matter of national importance.”
In its report, Weekend Nation quoted experts imploring on the Tonse Alliance administration to devise lasting remedial measures to ensure the bank meets appropriate corporate governance standards.
The paper said while the Reserve Bank Act provides for its independence, the environment created, “lacks democratic princiles.”
It urges the government to “seriously and critically” address funadamental lapses of governance.
The paper said the same should be instituted at Parliament where members determine their own salaries and and condition of service.
In quotes reported by the paper, renowned legal expert Justin Dzonzi said there should be mechanisms that perhaps would distance certain decision-making processes from the individuals.
“We have no problem with the independence of the central bank with monetary policy issues but when it comes to conditions of service they should be totally independent. Perhaps the power should be vested with the Ministry of Finance so that decisions affecting their conditions of service should reflect the general status of the economy,” Dzonzi said.
With respect to members of Parliament, Dzonzi said their conditions of services should also be vetted by an independent body “to decide what would be competitive packages for them in an economy like Malawi.”
Happy Kayuni a political and administrative studies lecturer at Chancellor College is quoted observed that what is happening at RBM and Parliament is not in tandem with governance issues and asked government to demonstrate what it has been promising about good governance and rule of law by, among other things, starting with correcting these institutions.
‘‘The reforms exercise which government is undertaking should carefully look into these matters. We know that some of these institutions are highly politicised. For instance, members of Parliament are used to build support of government agendas,” he said.
Kayuni also suggested that there should be an independent body to look at the operations and conduct of these institutions to correct such issues and ensure there is sanity in the institutions.
Meanwhile, auditors have instituted a forensic appraisal at RBM to establish how its affairs have been managed in recent times and the audit results would be concluded in the first quarter of 2021 and central bank’s spokesperson Onellie Nkuna said the findings of the forensic audit will be shared with all its stakeholders once the audit is complete.Follow and Subscribe Nyasa TV :