Abuse at Malawi’s Education Ministry

The Ministry of Education has within seven months lost nearly K18 million (about $50 000) on fake out-of-duty station allowances in a scam that also violates Office of the President and Cabinet (OPC) policy regulations on allowances.

In a March 25 2011 circular reference number 15/15/1, Chief Secretary to Government Bright Msaka restricted officers’ internal out-of-duty station allowances to five nights per month.

The circular was a reaction to revelations that some officers at the Ministry of Agriculture drew allowances for more than 1 000 days in a year or 40 days per officer in a month, leading to millions of public funds enriching a few.

The circular also advised that officers should be paid allowances at rates corresponding to their grades or where officers travel for more than five nights, they get allowances at reduced rates.

But a September 2012 Ministry of Education internal audit report we have seen shows that one official could claim 30 or more days in one month in out-of-duty station allowances.

The audit found that nearly K18 million has been spent on unwarranted allowances, reminiscent of the matter that led to the interdiction of several officers at Ministry of Agriculture four years ago.

The audit also found that Ministry of Education headquarters cannot account for over K5.3 million claimed as fuel during the period, making a total of slightly over K23 million wasted between November 2011 and June 2012.

The total, K23 149 900, is enough to fund Mkwichi Secondary School in Lilongwe in the 2012/2013 fiscal year, according to budget estimates presented by Finance Minister Ken Lipenga last June.

The roughly K23 million funding to Mkwichi includes leave grants and allowances handled by Treasury for the school, but the actual amount that goes to the school for operations is K3.8 million, as the rest is administered by Treasury.

What this means is that the K23 149 900 misused at the Ministry of Education headquarters would fund operations of six secondary schools at the level of Mkwichi.

But in reality, even the K3.8 million is an under-allocation because, according to Mkwichi head teacher, Bridget Nungu, the school needs at least K12 million to finance its planned operations in a year.

Audit findings

The audit, done by Ministry of Education Internal Audit Unit, was conducted in the months of September and October 2012. It covered the period between November 2011 and June 2012 and targeted internal travel expenses, external travel expenses and transport management.

Overall, the report said the findings bordered on fraud, abuse of public funds, laxity in implementing internal controls and theft.

The audit shows that in the period under review, officers at the Education Ministry headquarters claimed subsistence allowances at full rate for more than the required five nights per month, amounting to K15.1 million.

The ministry also paid K1.5 million to officers working within duty station, against the OPC regulation.

The audit report also noted that the ministry paid officers K1.3 million at rates higher than their grades.

It further shows that management of the ministry agreed with the audit findings and “indicated that the money will be recovered from the officers”.

“The officers should be disciplined accordingly, the practice should be stopped immediately and preventive penalties such as interdiction, suspension etc, must be imposed on those who will be caught doing the same,” recommended the ministry’s audit team led by controller of internal audit services, a Mr. G.B. Msanyama.

Details of the report, for example, show that more than 50 officers claimed allowances for more than five prescribed nights per month.

Furthermore, some 19 officers claimed up to K1.5 million in out-of-duty station allowances while working within Capital Hill, according to the report.

The report also lists 23 officers who claimed allowances higher than their grades amounting to K1.3 million.

A separate audit following an anonymous letter alleging theft through a project called Cohort Tracking in the ministry found that up to K6.3 million was irregularly paid in allowances to officers from ministry headquarters.

Also through the same project being carried out in conjunction with Unicef, the ministry is failing to account for fuel of about K600 000.

Cohort Tracking was initiated to provide information relating to students/pupils who are starting standard one proceeding to standard eight, students who drop out, comparison in boy and girl enrolment and dropout rates in boys and girls.

The audit found that several officers got allowances claiming they went to one of the cohort sites in Salima when, in actual sense, they never visited the district.

Some were paid twice for the same trip which was never undertaken whereas others went to Salima once, but got double allowances.

In some instances, officers added payees on the list to be paid allowances without their consent and ended up pocketing the allowances themselves.

“The cause was intent to defraud government and disregard government regulations,” reads the audit report in part.

Treasury spokesperson Nations Msowoya said on Tuesday this week that “the Ministry [of Education] has been asked to work on the findings of the report, that is, improve on internal controls and take appropriate actions.”

“As part of strengthening internal audit, government has also established Internal Audit Committees (IAC) in all ministries. This committee acts as an advisory team to the CIAU [Central Internal Audit Unit]. The IAC of the Ministry of Education has been tasked to act on the findings of the report,” said Msowoya.

He said: “CIAU is a fairly new creation by government born some 10 years ago as a management tool to strengthen internal controls in as far as management of public funds is concerned.”

The establishment of CIAU led to the setting up of internal audit units in all the big ministries (Education, Agriculture, Health, Treasury, Home Affairs, Land, Transport, Energy, Gender, Information) to, among others, check that proper financial management policies are being followed.

In an interview this week, Clement Chinthu-Phiri, OPC principal secretary for administration, hinted that OPC on its own has no mechanism to monitor adherence to rules it sets at various points.

According to Chinthu-Phiri, OPC hopes that NAO and internal audit units in ministries would eventually capture violations to financial rules and make controlling officers answer.

“We are not aware of violations so far, but the hope is that where there are such violations, controlling officers will be made to answer to the National Audit Office (NAO) through the annual audits,” he said.

By press time, the Ministry of Education had not responded to our questionnaire that sought to find out what corrective and disciplinary measures have been put in place in reaction to the malpractice.