MPs playing rightful oversight role on MSB

Chairperson of the Parliamentary Committee on Budget and Finance Ron Chipiko and his team deserve a special pat on the back for playing their rightful role in the Malawi Savings Bank (MSB) saga. The committee’s advice that government should help MSB ensure that Mulli Brothers Limited pay all outstanding debt is a good suggestion that government should embrace without any qualms. So, government should avoid politicking and dogging the issue.

The revelation that government is ignoring an agreement that payments to Mulli Brothers Limited should be channelled through MSB makes sad reading. One is bound to ask: Why is government not honouring the letter of understanding? The revelation that other organisations such as Smallholder Fertiliser Farmers Revolving Fund of Malawi (SFFRFM), Agricultural Development and Marketing Corporation (Admarc), Malawi Defence Force (DF), Malawi Rural Finance, Malawi Rural Development Fund, Farm Input Loan Programme and Public Universities Students Scheme owe MSB money is equally is cause for concern.

Government should ensure that all organisations that owe MSB loans repay their debts. Some of the institutions such as SFFRFM and Admarc have the capacity to generate their own funds. One wonders why they are unable to service their debts. We know that government has been undermining the performance of these organisations by favouring private companies to supply farm inputs, thereby depriving them revenue. Be that as it may, Admarc and SFFRFM still have capacity to raise funds to meet their financial obligations.

MPs have a point that MBS should recover its debts in full. If all debt is repaid, there will be no need for government or the Private Partnership Programme to MSB. In this case, MSB can recapitalise itself without using tax payers’ money. It is also in the interest of Malawians that government retains 100 percent shares in MSB. The advantage is that profits made by the bank will be remitted to government as the sole shareholder and can use that money for development purposes. Government needs more resources to fund its many development programmes than the so-called strategic partner. Malawians have not benefitted much from privatised companies. Many of these companies have pursed their own narrow agenda at the expense of the welfare of the majority of Malawians. In many respects, the privatised companies have performed worse than when government operated them.