MALGA dismisses Minister Gwengwe on CDF, dissatisfied with MK45.13bn allocation to councils

The Malawi Local Government Association (MALGA) has dismissed assertions the Minister of Finance and Economic Affairs, Sosten Gwengwe, said in parliament that the revised Constituency Development Fund (CDF) will accelerate rural development.

MALGA, an umbrella body for all local governments in Malawi, has also expressed dissatisfaction with the proposed overall allocation for local councils in the 2022/2023 budget statement.

The association’s Executive Director, Hadrod Zeru Mkandawire, was responding to the 2022/2023 National Budget, which Gwengwe presented in the National Assembly on Friday.

Hadrod Zeru Mkandawire, MALGA Executive Director

The proposed budget has pegged CDF at MK100 million up from K40 million while development budget under local councils has been allocated a total of MK45.13 billion.

The budget statement is entitled “Accelerating Implementation towards wealth creation, job creation and food security” and is premised on the vision of “accelerating our journey towards an inclusively wealthy, self-reliant and industrialized nation.”

Gwengwe, in particular, praised the revised CDF, saying it will be used as a direct and catalytic vehicle to advance meaningful development to the rural masses, where every Member of Parliament will be required to show flagship projects for his or her area.

Gwengwe had told Parliament, “A budget must be inclusive, a budget must be pro poor and a budget must be developmental. It is in this vein Madam Speaker, that the Constituency Development Fund, as a direct injection to rural projects and as a complementary part to the 100 million dollar rural GESD program, has been revised to K100 million per constituency”.

However, Mkandawire has disagreed with the minister’s statement amplifying the new CDF, describing it as surprising.

“CDF has never been and cannot be a direct and catalytic vehicle to advance meaningful development to the rural masses. This statement is a fallacy, void of the facts and a deliberate twist of the reality to hoodwink Malawians.

Contrary to what the Government wants Malawians to erroneously believe, it is evidently clear from Auditor General’s audit reports into accounts of local authorities, including the recent one, that CDF is littered by abuse, fraud, projects quality challenges and projects not aligned to the district development and urban development plans. All this is perpetrated by Members of Parliament, using their political muscles,” said Mkandawire.

Instead, Mkandawire praised District Development Fund (DDF) and Infrastructure Development Fund (IDF), saying these have been models of inclusive and transparent local development.

He said DDF and IDF respond to the direct development priorities and needs of the people contained in district development plans and urban development plans.

No wonder, added Mkandawire, the World Bank and other bilateral and multilateral development partners, have adopted the DDF and IDF models as means of funding local development.

“Therefore, until the Honourable Minister of Finance brings contrary evidence on his claims that CDF is catalytic for local development, we take his sentiments as mere political speculation meant to deliberately mislead Malawians for political expediency and convenience,” he said.

In his presentation of the budget statement, Gwengwe broke down the MK45.13 billion for local councils as follows:

K19.3 billion for CDF, K18.6 billion for construction of city roads, K3.1 billion for DDF, K2.3 billion for the construction of water structures, K810.51 million for IDF and K1.0 billion for dualization of Blantyre–Chileka road.

However, Mkandawire said the title of the budget statement and the vision underpinning it are meaningless without meaningful fiscal devolution, as the key fiscal issues for the local authorities have, once again, been overlooked.

“We, therefore, wonder how Malawi can become an inclusively wealthy, self-reliant and industrialized nation with the status of our local government authorities. The local government authorities remain in huge debt occasioned by slow fiscal devolution due to lack of political will despite the existing enabling legal and policy framework to facilitate meaningful fiscal devolution. Despite our plea contained in our submission to the 2022/2023 pre-budget consultations, the bailout package for councils has, once again, been overlooked,” Mkandawire said.

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