It has emerged that Treasury did not fund all government ministries, departments and agencies (MDAs) in December 2015 and has since held on to the funding.
Ministry of Finance spokesperson Nations Msowoya confirmed this Tuesday and said funding would be released on a need-to-need basis.
Treasury’s confirmation is contrary to earlier assertions that the country’s 28 district councils did not receive funding because they did not submit their monthly expenditure reports as mandated in the Public Finance Management Act.
Treasury said only hospitals were funded last month because the November 2015 funding was disbursed mid-month and this was expected to spill over to December as civil servants closed offices for a 10-day holiday.
Said Msowoya: “In December, everyone, except hospitals, was not funded. The funding for November was done around mid-month and it was meant to go into December. In December, people only worked for a few weeks because of the holiday.”
When asked what the approved allocation for December for the MDAs would be used for, Msowoya said the MDAs would be compensated with cash flow depending on their needs.
“When these ministries and departments complain, you should also question them why they are not receiving funding. If a budget is not there, we cannot create a budget at Treasury,” Msowoya said in reaction to the unavailability of funds for parliamentary committees such as Public Accounts and Budget and Finance to meet ahead of the Mid-year Budget Review from February 22.
Legal Aid Bureau was one of the agencies which did not receive funding in December and was yet to get funding for January 2016.
The bureau, which became operational in 2015 as an entity separate from the Ministry of Justice and Constitutional Affairs, was allocated about K384 million ($531 120) in the 2015/16 National Budget. Ironically, President Peter Mutharika’s 17 aides get a package of K308 million ($426 003) per annum.
The bureau said it only received a fraction of this amount.
The bureau was expected to receive K168 million ($232 365) for operations of the three offices, namely the headquarters in Lilongwe and Blantyre and Mzuzu offices for activities such as civil litigation, homicide cases, prosecutions, legal advisory services and general administration.
About K116 million ($160 443) was allocated to salaries and allowances whose disbursement is assured and K100 million ($138 313) for the procurement of motor vehicles for the 2015/16 financial year, according to budget documents.
However, Legal Aid Bureau director Masauko Chamkakala confirmed that the department has not received funding for December and was yet to get funding for January.
This means they have been operating on about K14 million ($19 634) which Treasury remitted to them in November last year for office supplies, payment of utility bills, fuel, maintenance of vehicles and internal travel.
“The last funding the bureau received from Treasury was November 2015. The bureau is yet to get funding for December 2015 and January 2016. Treasury has not communicated on the reasons for the situation,” Chamkakala said.
Malawians seeking services at the bureau are being asked to produce paper to print their grievances on as stationery has run out.
The already financially incapacitated department operating with nine lawyers to service millions of Malawians who cannot afford a lawyer has suspended some of its operations as the officers’ mobility has been affected due to lack of fuel.
“It is difficult to ably execute the legal mandate of the bureau in the circumstances considering that the allocated funding is already inadequate. Frankly, some operations have been suspended due to the financial situation,” he said.
According to the legislation which established the bureau, there is supposed to be a Legal Aid Fund which would ensure that legal aid services are not suspended due to lack of funds.
However, the government is yet to capitalise the Legal Aid Fund over 12 months after it was delinked from the Ministry of Justice.
Chamkakala said he has been in touch with one of the leading commercial banks to house the fund, but capitalisation from the government would be crucial to its formation.
“Despite making proposal to government to capitalise the fund, no allocation was made in the present financial year. Further, government is yet to give consent to the bureau to set up the fund,” he said.
Funding cuts are being experienced in various government sectors and will only worsen once Minister of Finance, Economic Planning and Development Goodall Gondwe presents his Mid-year Budget Review next month, which the International Monetary Fund (IMF) asked to be revised in keeping with low revenue in the first quarter of the2015/16 financial year and poor donor inflows.