- Germany ready to support fight against corruption
- Cashgates masterminded by public servants
- Most of the prosecuted are outsiders
- Govt not keen to investigate 13 case files
- No one prosecuted in K236bn Cashgate
- Malawi’s rating on corruption fight poor
Germany has said it is ready to join Malawi government’s fight against corruption.
“Germany, stands ready to support the Malawian authorities to expose, punish and drive out corruption wherever it occurs,” the new Germany Ambassador Jurgen Borsch said on Thursday.
Last year, the National Audit Office (NAO) commissioned a forensic audit after an analysis by PriceWaterhouse Coopers (PwC) on government bank statements involving K577 billion covering the years between 2009 and 2014 showed that 43 percent of the payments were not accounted for in the Integrated Financial Management System (Ifmis).
The forensic audit was conducted by RSM Risk Assurance Services LLP of the UK.
The first forensic audit conducted by Baker Tilly, covering April to September 2013, established that K24 billion was siphoned from the public purse through dubious payments, inflated invoices and goods or services never rendered.
Borsch said the forensic audits show that failures in the system, and collusion, corruption and theft have been going on for a long time across multiple administrations.
Said Borsch: “This underscores the need to have more robust systems in place and action against those involved. The audit work has especially identified the integrity of procurement processes as a key concern that should be addressed.”
Borsch, whose government jointly funded the second audit (involving K577 billion), which has now been recalculated to K236 billion, told Weekend Nation in an interview on Thursday: “It is very critical that the law enforcement agencies pursue their investigations with the necessary sense of urgency to bring to justice those who have defrauded the Malawian people. Nobody should be above the law.”
The forensic audit by RSM Risk Assurance Services LLP of UK under the leadership of NAO concentrated on 50 most frequent government suppliers suspected of receiving government funds without supplying legitimate goods, services or works or in doing so using artificially inflated prices.
The audit report came against the background of a report released last year by PwC, which showed that K577 billion in government bank statements could not be reconciled between 2009 and 2014.
Born in 1956, Borsch has replaced Peter Woeste who left the country mid this year. Most recently, Borsch has served as Consul General for Florida, Puerto Rico and the US Virgin Islands.
The PwC investigations identified significant discrepancies between payments made from government bank accounts and the records held in Ifmis.
Following the RSM Risk Assurance Services LLP of UK audit report, the Auditor General submitted 13 case files of businesses to the ACB) for further investigations but no one has yet been prosecuted.
Borsch, whose government alongside other donors—the European Union, the UK, Germany, Norway, Ireland—funded the audit said the report shows that failures in the system, and collusion, corruption and theft have been going on for a long-time across multiple administrations.
Borsch said as development partners, their role is not in investigations, but to support Malawi in its efforts to improve public financial and economic management, to ensure that both Malawian and foreign taxpayers’ money is spent to the maximum benefit of the people of Malawi.
He also said Germany shares the International Monetary Fund (IMF) recent assessment that, while some progress has been made, improvements in the public financial management in Malawi need further and sustained efforts.
In September this year, IMF announced an extension from December 2016 to June 2017 of the Extended Credit Facility (ECF) programme to Malawi.
The Breton Woods institution has advised the Malawi government to establish strong macroeconomic targets focus on taming the galloping inflation rate, rationalise public spending, finding solution to power outages and enhancing public service reforms to breathe life into the economy which is tanking.
Borsch said the audits identified accounting, procurement and contracting practices as key areas for concern where urgent reforms are needed to ensure transparent, efficient and prudent use of public finances in Malawi.
He also said the independence of the ACB, as well as of the Auditor General who led the process of the forensic audit, remain critical issues for further improving integrity in the management of public finances.
Commenting on the main focus of his work in Malawi, Borsch said he was here to further develop the friendship with Malawi and support the people of Malawi on a path to a sound, fair, prosperous and sustainable development.
“We have to embrace the same challenges in different forms of appearance: climate change, energy supply, management of resources such as water, sustainability. Based on the principles of trust and mutual respect, I wish to share best practice and develop synergies with the government of Malawi in its effort to manage the current challenges to the country and its population,” he said. n