The Public Accounts and Budget and Finance Cluster Committee of Parliament has proposed legal reforms to empower the House to change allocations in the national budget.
Presenting the cluster’s budget analysis report in Parliament yesterday after two weeks of assessing the proposed K1.9 trillion 2021/22 National Budget, the committee’s co-chairperson Shadrick Namalomba said there is need for the country’s budgeting system to move away from incremental budgeting to activity-based budgeting.
He said the proposed reforms would enable Parliament to address some of the inefficiencies, redundancies and waste of public resources in the budget.
Namalomba said: “The lack of legal provision to guarantee us as a National Assembly to revise the budgetary votes after the rigorous and tiresome scrutiny of the same through the cluster committees and also through Committee of Supply process is something we must seriously look into and make bold decisions on the same.
“If this cast in stone and is not reviewed, we will reach a point in future where the relevance of cluster committees will seriously be compromised.”
He said there was need for a legal provision to empower Parliament to contribute the to revision of allocations in the budget through voting when necessary instead of rubber-stamping.
Minister of Finance Felix Mlusu presented the 2021/22 National Budget Statement in Parliament on May 28 2021 and over the past two weeks, cluster committees have been meeting government ministries, departments and agencies to scrutinise allocations as part of budget oversight.
Under the current system, Parliament is only allowed to reallocate resources within budgetary votes, but members of Parliament (MPs) do not have powers to increase funds to a vote.
The Cluster Committee on Public Accounts and Budget and Finance’s sentiments followed a myriad of concerns from other parliamentary cluster committees on the trimming of some critical budgetary votes.
The cluster committees feared that development and public service delivery will suffer because resources in the proposed budget have largely tilted towards statutory obligations such as salaries and benefits.
In its analysis, the Public Accounts and Budget and Finance Cluster Committee wondered why the government has weakened financial accountability institutions through the allocation of inadequate funding at a time government intends to root out corruption and ensure the country has strong governance institutions.
The committee noted that the Financial Intelligence Authority total recurrent budget is 32.8 percent less than last year’s allocation while the National Audit Office has a 44.2 percent cut compared its allocation last year.
Namalomba, who is Mangochi South West legislator (Democratic Progressive Party-DPP), said: “If the National Audit Office budget is tremendously cut like this, how do we ensure the protection of the resources in the increased budget? Let us be serious in safeguarding public funds if we want to change this country.”
In line with Malawi 2063 (MW2063) Vision, the committee expressed concern that the parent Ministry of Economic Planning and Development and Public Sector Reforms was allocated K2.9 billion against its proposed K6.5 billion for implementation of development activities.
On his part, co-chairperson of the Cluster Committee on Agriculture and Natural Resources, Ulemu Chilapondwa, urged government to be serious in investing in energy as it is a catalyst for development.
His sentiments were in respect to the Ministry of Energy vote which has been allocated K30.329 billion, which is K8.610 billion less than what it received last year.
Chilapondwa said lower funding will jeopardise investments such as the 350 megawatts Mpatamanga Hydro-power Project which requires government to commit funds to the public private partnership arrangement.
On the need to empower the Agricultural Development and Marketing Corporation (Admarc), Chilapondwa, who is Ntchisi South MP (Malawi Congress Party-MCP), said the committee was surprised by Treasury’s refusal to allow the institution offshore borrowing of over $500 million with an interest rate of 2.5 percent.
He said Ministry of Finance instead recommended Admarc to borrow from local commercial banks with huge interest rates. He said if Admarc can borrow locally to buy maize from farmers, they will pay an interest of K10 billion and make a K1 billion profit.
The committee has since recommended that Treasury should allocate K95 billion additional funding for Admarc to buy maize and other crops on top of its K12 billion allocation.
The Committee has threatened to boycott the Committee of Supply if the Minister of Finance will not allocate K95 billion extra to Admarc, saying low funding is against President Lazarus Chakwera’s State of the Nation Address which called for the serious revamping of Admarc through adequate financing to benefit farmers.
On his part, co-chairperson of the Legal Affairs and Government Assurance Cluster Committee Yusuf Nthenda, who is Mulanje West MP (DPP), urged government to walk the talk in empowering accountability institutions such as the Anti-Corruption Bureau, Malawi Human Rights Commission and Legal Aid Bureau by allocating them adequate funding.