Government ministries, agencies and departments (MDAs) owe public utility service providers—the country’s five water boards and Electricity Supply Corporation of Malawi (Escom)—in excess of K10 billion in unpaid bills dating back to 2015/16 financial year.
Without giving exact amounts, Minister of Finance, Economic Planning and Development Goodall Gondwe told Parliament on Tuesday that government owes utility providers huge sums of money.
He said the outstanding amounts would be paid in cash as funds for the same have already been allocated.
Said the minister: “We are centralising payments for all utility bills. Treasury will take care of all bills, but as a measure to guard against wastage, we will pilot out prepaid water payment system. But we are clearing all debts.”
Gondwe’s explanation followed a question from Kasungu North West member of Parliament Elias Wakuda Kamanga (People’s Party-PP) who wanted to know the strategy Treasury was employing to clear outstanding utility bills that are stifling operations of utility firms.
Information independently sourced by The Nation shows that Lilongwe Water Board (LWB) is owed about K2.2 billion by various MDAs, including Malawi Defence Force (MDF), Malawi Police Service (MPS) and tertiary education institutions.
In an earlier interview in the week, LWB public relations officer Bright Sonani refused to divulge details of the defaulters on the basis of client confidentiality.
Normally, water supply contracts between boards and customers dictate that supply would be disconnected after 30 days of non-payment.
Sonani could not say how the MDAs accumulated huge bills, saying as a water utility, they treat all customers equally and whenever a customer has unpaid overdue bills they are disconnected from supply.
Yesterday, Blantyre Water Board (BWB) public affairs officer Priscilla Mateyu also refused to mention defaulting MDAs, but confirmed that government agencies owe the board about K1.3 billion.
In April this year, BWB disconnected Chileka Airport and MPS lines in Blantyre and Limbe over non-payment of water bills.
The Nation investigations revealed that the airport had accrued bills in the region of K32 million while police owed K340 million accumulated over a six-month period prior to April 2016.
Details of amounts owed to the other three boards—Northern Region Water Board (NRWB), Central Region Water Board (CRWB) and Southern Region Water Board (SRWB)—were yet to be verified. However, earlier this year, NRWB was owed over K1.6 billion by customers.
In case of Escom, Minister of Natural Resources, Energy and Mining Bright Msaka confirmed in an interview yesterday that MDAs owe the power utility about K4 billion in arrears while the private sector, including individuals, are yet to pay a whopping K9 billion in unpaid bills for electricity supplied.
Treasury spokesperson Nations Msowoya said the water boards arrears were on record but were yet to be authenticated and audited before payment could be made.
Recently, Escom scaled up its prepaid billing platform to accommodate more customers and check default.
BWB and NRWB have also embarked on pilot phase of pre-paid water billing to counter default. The other boards are also working on similar projects as part of the Public Sector Reforms Programme.