EXCLUSIVE: How phantom government projects finance Malawi political parties

Since the dawn of democracy in Malawi 22 years ago, successive ruling governments have created false or phantom projects by including them in the national budget for financing but the projects do not see light of the day. It seems vast resources for these projects are used for political machinations and acquisition of political party assets at the expense of public service.

While former government officials concede that indeed political parties in power employ different systems to fleece Government huge amounts of money to fund its political activities, Government as well as ruling political party officials say it is incorrect to make such sweeping conclusions.

Investigations conducted by this journalist indicate that for two consecutive years the State Residences continue getting the same amount of funding every year for similar projects without any better explanation why there is nothing tangible on the ground.

The same is the case with Rumphi Teachers Training College which together with two similar projects in Mchinji and Chikwawa keep getting resources for construction of infrastructure to allow it smooth operation without materialising.

Teachers Training College

According to the 2015-2016 approved budget K750 million kwacha has been allocated under the Education Infrastructure Management Unit of Ministry of Education, Science & Technology for the construction of the two facilities with resources acquired from OPEC Fund.

 In October last year Government said it had approved designs for Rumphi Teachers College (TCC) almost four years after a foundation stone was laid.

At the time that the project appeared in the budget during the regime of former president the late Bingu wa Mutharika indications were that the Saudi Fund, Arab Bank for Economic Development in Africa (Badea) and another donor from Sudan, had given a grant of US$34 million (about K1.9 billion).

Since 2011, when President Peter Mutharika, then Minister of Education, Science and Technology laid the stone no activity on the site has taken place.

There has been conflicting reports from Government on the commencement of the project with Ministry of Education, Science and Technology Spokesperson Manfred Ndovi telling The Nation in October last year having approved designs and identified consultant for Rumphi TTC construction will start this year but this is December and nothing is on the ground.

On the other hand, a day before he was replaced as Treasury Spokesperson Nations Msowoya told this journalist that the Rumphi TTC project, although delayed is still active.

“Currently the Government is evaluating tenders for construction of the college and in 2017 the project will start,” Msowoya seems to be demonstrating how Government keeps shifting the goal post although he insisted that the money for the project is still there.

In July 2015 Finance, Economic Planning and Development Minister Goodall Gondwe told civil society leaders in Mzuzu and other stakeholders that the construction exercise is in progress and that it will complete within the targeted period.

But a visit to the designate site for the infrastructure showed that there is only a beacon at the place and nothing else.

Principal Group Village Headman Chitandika said they are disappointed that for years politicians have come and gone without the project taking off.

“We have been told that money for the project is there but there is nothing to show for it,” said the village head who said they now need the land for a community driven project for the school.

 State Residences

In the two last financial years parliament has allocated money to the State Residences to carry out similar projects.

 The 2014/2015 financial year budget documents indicate that K75m was allocated for the rehabilitation of roads and drive while in the 2015/2016 the same project was allocated K200m.

The same is the case with the extension of clinic facilities where K25m in the 2014/2015 national budget but K50m was provided the following financial year for the same job.

For the two consecutive financial years construction of security fence has been allocated K50m in either year while the controversial construction of banqueting hall was provided with K50m before it was given an additional K250m a year later.

In the 2015/2016 budget, K250m was set aside for the construction and rehabilitation of state houses and Lodges, however the following year Mtunthama State Lodge which falls in the same category got K50m for its rehabilitation.

Parliament also made available K75m for rehabilitation of Water Works and Sewer Systems at State Residences but even without anything being done on the ground the foregoing financial year it got another budgetary allocation of K50m.

Mzuzu Airport

Government allocated K200 million for the rehabilitation of Mzuzu Airport although Minister of Transport and Public Works spokesperson James Chakwera indicated that this money might not be enough to cater for the whole rehabilitation process while a high ranking official in the department of civil aviation wondered why the money was put into the budget.

“As a department we are supposed to tell Government what we require for Mzuzu Airport,” said the official who described the inclusion of the resources towards this purported project as political.

Demystifying the allocations

Former cabinet minister in different portfolios Sam Mpasu said this could explain some of the systems that ruling political parties use to siphon money from Government coffers in order to help in financing its political operations.

Mpasu who served as Minister of Commerce and Secretary General of the ruling United Democratic Front (UDF) in 1999 as well as speaker of the Malawi parliament said there are several systems to use public resources ‘when you are in government’.

Mpasu explains that this is one of the systems that works well in Malawi because respect for national institutions that include parastatal organisations, Government ministries and departments is not there.

Officials from these national institutions give‘business orders or something like that to members of the ruling party as against other Malawians who support opposition or don’t support any political parties so this has destroyed our national institutions or politicized them’.

“This is why you find that although the Constitution is very clear that national institutions should be apolitical, they are used for political ends and this is the main reason why our countries are less developed as they should be,” explains Mpasu who has once been minister of Information, Health and Population, Education, and Trade and Industry in the UDF government.

Mpasu who in 2008 was sentenced to a six-year prison sentence over charges of corruption and abuse of office when he was education minister 14 years earlier explained that anyone who aligned themselves to the ruling party make money from Government and Government institutions and they make handouts to support the party in power in turn.

He said cabinet ministers as well as the president also use state facilities when they conduct political matters including political rallies.

“You cannot compete on that score against a ruling party,” insisted Mpasu who said it starts with the presidency who still useshelicopters, security and all that when conducting political rallies.

Government defends the practice

Msowoya of the Treasury said as regards all Public Sector Project, the Ministry of Finance Economic Planning and Development maintains a database of all active projects in Malawi.

He said these projects could be at different stages such as: identification, appraisals, implementation etc. and with such ‘a rigorous database which gets vetted by various structures of Government including cabinet, it is very difficult to have phantom projects and indeed another form of Cashgate’.

Speaking before he was relieved of his PRO duties, Msowoya said no government project receives funding from treasury without submission of reports and treasury undertakes monitoring visits on a quarterly basis.

“As for the Mzuzu airport the project is still at appraisal, however the Government is still looking for more money to fully appraisal the project,” said Msowoya.

Ruling DPP Style

Ruling Democratic Progressive Party (DPP) Spokesperson Francis Kasaila says he has never heard and is not aware that ruling parties can take advantage of the budget to divert resources for political activities.

“As far as I know how the budgetary process takes place, it is the ministries and departments technicians that come up with those figures and not the ministers,” he said.

Kasaila who is also Minister of Foreign Affairs and International Cooperation said as far as he knowsit could be that in the time of ‘honourable Mpasu they were interfering the work of technicians probably’.

He further explained that each budget item has a separate amount and those are controlled by controlling officers who are not even ministers, but principal secretaries and therefore wonders how that get into the parties.

“May be at their [UDF] time they had their own way of doing this but I have never heard about it as far as I have been in cabinet and therefore I cannot say whether Mr. Mpasu is right or not, maybe he is right during his time,” he said.

As for DPP, he says it gets its funding from a lot of sources including fundraising from time to times.

“We go out to fundraise to collect resources for the running of the party,” insisted Kasaila.

He also disclosed that there other benefactor is theirparty president Peter Mutharika, who is also the state president who has been supporting the party even before he became the state president.

“When we were out there he used to support us and therefore we cannot imply that the support that we get now is coming from Government,” Kasaila said.

He said for DPP, there is clear demarcation between party and government which started during ‘the Bingu time’, who‘made it very clear that he wants to make sure that there is a difference between the party activities and government activities and that is continuing now’.

“We don’t see ourselves as a party getting resources from a budget line of a ministry how that can happen I really finding it difficult to understand but probably Mr. Mpasu can explain it better on how that happened,” he said.

The State House Response

Presidential Press Secretary Mgeme Kalilani said without trying to create an impression that he is an expert on financial matters when Government talks about budget being passed they are not talking of fund in real terms, since this is just an expenditure plan.

“When you have a plan of expenditure you should not then conclude that funds were made available for the plan, if you had planned to buy a chair, were funds, then after the approval of parliament, allocated for the purchase of the chair?” he argued’

He said in the absence of such information, whether the funds were really made available ‘we can’t then jump into a conclusion to say year in, year out the same activities are being allocated funds’.

“Allocation is a different thing and planning is a different thing, then if we had proof that there were funds that were allocated for a specific project specifically to state house and that project was never implemented then perhaps we would have an issue to say then what happened to the money?” explained Kalilani.

In Malawi’s history, he said may be it is only in the 1960s, where a particular government department got 100 percent of what was approved for it in the national assembly.

Kalilani explained in most cases most departments get far much less than what was approved in parliament and that is reconciled later on.

“And that may explain why sometimes you have the same project appearing once and again; I am putting this at a hypothetical level, so I would think that even with the state house I don’t think it would be very far away from that,” he said insisting that no such money can be used for political activities.

Mpasu said Malawi’s ruling political parties are taking advantage of the situation as Malawi has been very asleep on matters they should have been acting on.

“If you read Section 184 of the Constitution it creates the office of Auditor General; and it orders the Auditor General to audit every organisation that uses tax payer money and submit an annual report to parliament through the ministry of finance,” explained Mpasu.

He however saidno minister of finance has ever presented annual report of the Auditor General to parliament and this is why Cashgate and the K577bnscandal were exposed only through forensic audits from external auditors.

He said Government controls the Auditor General who is also afraid to audit Government for fear of exposing certain things.

“Once you lean on the Auditor General anything goes; corruption, theft, embezzlement, whatever,” said Mpasu.

The former top ranking Government official therefore called on IMF, the World Bank as well as other donors never relent when it comes to monitoring Auditor General and ensuring that it remains independent.

“In that case, no one will be brave enough to take even K1 from the Government vote,” he said.

• This story has been supported by Centre for Investigative Journalism*

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