Minister of Energy Newton Kambala has asked Electricity Supply Corporation of Malawi (Escom) to explain financial challenges and K40 billion debts it is facing.
The minister made the remarks on Monday when he visited Escom powerhouse in Blantyre.
Speaking in an interview, the minister said the utility company is struggling to provide efficient services because of poor financing.
Said Kambala: “We have received a report from Escom management that they are struggling with debts from banks and they also have little access to loans from suppliers because they haven’t paid them for a long time.
“The ministry wants to unlock the company so that it should start providing better services to the general public.”
The minister further claimed that Escom is facing financial challenges because it failed to manage resources prudently.
He said: “They lost resources because of corruption and we want management to give us assurance this time around that they will be prudent enough to ensure whatever resources they have are well-looked after.”
According to the minister, the Tonse Alliance administration will not tolerate the theft of public finances.
“We want to make sure that any support government gives to Escom now should be used efficiently and benefit Malawians. I will have a meeting with the management on the importance of desisting from corruption,” said Kambala.
On his part, Escom chief executive officer Allexon Chiwaya said they are in debt because the company is supplying less than 300 megawatts despite their rated capacity to supply 800 megawatts.
He also said some customers fail to pay bills on time.
Chiwaya assured the minister that they will address corruption concerns that have been associated with the institution.
“This is embarrassing and we will use all the laws in the country to find the root cause,” he said.
Last week, Escom said it supported calls for an investigation into reports that it was providing fuel to former governing DPP functionaries.
In April this year, the Anti-Corruption Bureau said it had concluded investigations into a K1.4 billion procurement scam at the power utility and called for the prosecution of suspects.
In a memo, titled ‘Allegation that between 2015/16 Escom made procurement worth K1.4 billion without complying with procurement procedures’, lists the suspects who include Jean Chifundo Mathanga and Andrew Kandulu to be prosecuted for neglect of official duty under Section 121 of the Penal Code.
Mathanga, a commissioner of the Malawi Electoral Commission, was also Escom board chairperson at the time.
Other people ACB wants prosecuted are Fanuel Nkhono, Emilius Kandapo, John Santana and Lyton Moyo. They are to be prosecuted under Section 63(1) as read with Section 63(2) of the Public Procurement Act, according to the memo.
The probe followed a complaint ACB received on September 21 2016 from an informant that there was political interference in the manner the contracts as well as payment to suppliers of over K4 billion were made.
The complaint added that goods were supplied without proper documentation and that procedures were not followed, a development that led to the resignation of Escom director of finance Betty Mahuka.