House committee for special mining fund

Parliament’s Natural Resources and Environment Committee has proposed creation of a special fund for proceeds from mining transactions instead of channelling the same to government’s main bank account, Account Number One.

Committee chairperson Werani Chilenga made the proposal during a meeting with representatives of mining activity communities in Lilongwe organised by the Catholic Commission for Justice and Peace (CCJP) in partnership with Centre for Environmental Policy and Advocacy (Cepa).

He said: “As a committee, while reviewing the draft [mining] bill, we noticed a few challenges which we do not agree with. We would like those areas to be ironed out once it has come to Parliament. The bill falls short of addressing issues raised in the African Mining Vision. As a committee, we also attended a few educational country visits, including to Ethiopia where we studied about the concept of mining for development plus some good case studies such as Botswana.

“The proposed bill stipulates that MRA [Malawi Revenue Authority should be collecting mining proceeds and put into Account Number One. It is difficult to monitor whether funds in the account really go to national development.

“We want instead a special fund to directly finance development projects. In this way, communities will be able to directly see the benefits of mining.”

Chilenga also said the committee will ensure that the proposed bill clearly outlines the roles and responsibilities of both government and communities in formulation and implementation of corporate social responsibility projects for companies.

In an interview yesterday, Ben Kaluwa, an economics professor at Chancellor College, a constituent college of the University of Malawi (Unima), supported the proposal, saying it will bring efficiency in the use and accountability of mining funds.

He said: “I totally agree with the proposal. Account Number One has given us problems. Just take for example how we have struggled to address the issue of drugs in the hospitals because of Account Number One. Account Number One has the sad legacy of Cashgate. Centralised accounting has let this country down.”

During the meeting, CCJP national coordinator Martin Chiphwanya said the meeting was organised to enable rural communities give their input on how mining proceeds should be managed.

He also appealed to communities to fast-track the process of bringing the bill to Parliament, noting that many communities were suffering and also government was losing a lot of revenue to loopholes in the current act which was enacted in 1982.

On their part, ordinary citizen representatives called on the lawmakers to also intervene in the plight of rural mining communities over issues of compensations for displaced families, permanent environment challenges and failure to prioritise local communities for recruitment of staff. n