Malawi now on ‘cash budgeting’ in procurement – Finance Minister

Malawi government has imposed new cost cutting measures of public procurement of services and materials which will be done on cash basis after major donors announced a freeze in budgetary support following the cash-gate scandal at Capital Hill.

Unveiling the measures at a news conference in the capital, Lilongwe on Wednesday, Malawi Minister of Finance Maxwell Mkwezalamba said the ‘cash budgeting’ procurement will be part of the measures for the 2013/14 financial year by the government in line with current economic conditions and the need to improve on management of public funds.

Mkwezalamba said the procurement should be done in line with the government procurement Act of 2003 and on cash basis, saying the accumulation of arrears will not be entertained.

“Central Government Stores, Government Printing Services and Central Medical Stores Trust have been entrusted with all the procurement. Where there is any deviation in the procurement procedures the controlling officers will be held personally responsible,” the Minister of Finance told reporters.

Mkwezalama: New touch austerity measures
Mkwezalama: New touch austerity measures

Mkwezalamba said that as a government they will look at enhancing revenue collection, saying crucial for the countries during the period donor aid taps will be dry.

“Revenue collection can be enhanced, not only here in Malawi but in many countries in Africa. What we collect is below the maximum potential that we can reach as a country.

“And there are governance issues that will have to be corrected in some of these revenue collecting agencies. We are also looking at both medium to long term measures, we have the tourism and mining sector which can also help us generate good revenue and also Agro processing and value adding of our agriculture produce,” said Mkwezalamba.

He said the Ministry of Economic and planning will identify some projects which will have to have its implementation postponed so that the resources that are available are spread adequately in this financial year.

As one way of ensuring that there is a good monitoring system to the measures, the Minister announced the establishment of a cabinet committee on Theft, Fraud and Corruption.

He also announced that government has with immediate effect suspended both internal and external travels by its officers, including President Joyce Banda.

It yet to be seen how government officials, accustomed to expensive lifestyles at the State’s expense, will suddenly stick to tight controls.

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