The Budget and Finance Committee of Parliament has called for the amendment of Public Finance Management Act (PFMA) of 2005 to include a provision that enhances transparency throughout the budget cycle.
The committee’s chairperson Gladys Ganda said this on Wednesday in an interview ahead of the presentation of the Mid-Year Budget Review Statement by Minister of Finance Felix Mlusu in Parliament today.
The minister is expected to outline how the K2.2 trillion 2020/21 National Budget has performed over the past six months amid a recurring budget deficit due to revenue underperformance triggered by the Covid-19 pandemic.
Ganda faulted government for failing to ensure transparency in the way the fiscal plan is being implemented, citing a number of financial-related scandals.
She said: “These financial-related scandals are landing into the public domain because the government would like to transact without following prudent and transparent procurement procedures.
“The recent Covid-19 funds that were embezzled just opened a can of worms that a lot is going on inside opaque doors.”
To ensure that there is seriousness, transparency and accountability in management of taxpayers’ money, Ganda, who is Nsanje Lalanje legislator, suggested the PFMA should include a provision that obliges the Ministry of Finance to consistently publish a pre-budget statement, an enacted budget, quarterly reports, audit reports and year-end report.
She said the PFMA should also include a provision that allows parliament to debate and approve revenue and debt projections in proposed annual government budgets and mid-year budget reviews.
“This will be different from what happens now where Parliament is only mandated to approve aggregated vote-by-vote expenditure projections for ministries, departments and agencies.”
While describing this year’s budget as off-track, she said what was envisaged when presenting the financial plan is not what is currently obtaining.
Ganda said: “Malawi was not fully prepared in the budget to curb and fight the pandemic. This saw the transfer of some funds meant for viable development projects to be used to save lives though some selfish officials ended up abusing this causse.”
In the K2.2 trillion fiscal plan, domestic revenue is projected at K1.2 trillion or 20.1 percent of gross domestic product (GDP), but available figures show revenues have been underperforming.
The budget projects a record fiscal deficit of K754.8 billion.
Mlusu admitted in an earlier interview that all has not been rosy in terms of revenue and expenditure trajectory in the budget implementation.
Analysts say the minister is widely expected to go back to the drawing board by tabling a supplementary budget to make adjustments to his maiden fiscal plan that has gone off-track during the first six months of implementation.