NLGFC Drills Accounts Officers in Financial Management

Cases of corruption and mismanagement of public funds in local authorities have become worrisome. While the majority of councils are playing to the book, a few errant officers are not. This has a direct negative correlation on the development of the nation. To avert this, NLGFC has been training accounts officers from different councils on proper utilization and management of public funds.

James Namame, NLGFC Fianancial Analyst says that, while the general public is awash with negative stories about fraud and mismanagement of funds in LAs, the NLGFC is engaging an extra gear in addressing the vice through capacitating council officers. Namame said this after such trainings in Blantyre, Mzuzu and Nkhotakota councils. He says the NLGFC has developed strategies against unscrupulous and fraudulent financial practices and transactions in councils.

One of the strategies is for Accounts Officers to fully adopt use of Integrated Financial Management Information System (IFMIS) in all financial transactions.

For Nkhotakota District Council, one of the trainees, George Nyasulu says the training had come at the right time.

“Accounts officers were failing to process payments using IFMIS which is a requirement by the accountant general and NLGFC that all councils should transact using IFMIS, but with this training, the officers will now have confidence to transact in IFMIS, produce Financial reports in time and share with stakeholders to help them know the financial resources for the council and on which development projects are the resources being used for,” said Phiri.

Namame says this resonates well with NLGFC values of making local councils corrupt free zones in Malawi.

The NLGFC empowered by the constitution of the republic of Malawi to ensure sound financial management, effective and efficient utilization of public funds in all local councils.

The era of inconsistent and lack of uniformity in the filling of standard programme based budgets is over. This is so following the successful conclusion to the generation of a budget manual for all local councils in Malawi.

Speaking to the NLGFC Newsletter, Yohane Nyanja, Budget Analyst at the NLGFC, says, ‘for a long time there have been inconsistencies and lack of uniformity in the filling of standard templates. So the manual seeks to guide local governments in formulation and reporting of the Programme Based Budgets (PBB)’, says Nyanja.

Nyanja says this propelled the NLGFC and the Ministry of Finance and Economic Planning and Development to make decision to develop the manual.

Nyanja says the PBB provides instructions to local governments on how to fill in the PBB budget templates and provides what information needs to get submitted.

Nyanja says he is hopeful that there will be great improvements in as afar budgeting and reporting are concerned.

Director of Finance at the NLGFC Kondwani Santhe says the Manual is an instruction and reference tool for local governments and it will go a long way to come up with uniform, consistent and standardised PBB’.

Santhe says the NLGFC is convinced that the budget manual will also assist local governments in PBB formulation, implementation and reporting prioritised expenditure on interventions that bring the best results in relation to financial management and utilisation.

The manual was developed with financial assistance form UNICEF and it compliments existing budget manuals, circulars and other guidelines for local governments in Malawi.

 Council Budget Review

The National Local Government Finance Committee (NLGFC) has called upon councils to make prudent estimates of revenue and expenditure for their councils as they prepare for the 2020/21 budget.

The remarks were made by the Executive Director of the NLGFC Mr Alifeyo Banda on the commencement of budget reviews and hearing meetings with individual councils across Malawi. Banda said in line with its constitutional mandate, the NLGFC conducts such yearly hearings as a measure to provide room for clarifications/technical directions to councils. This is done before submission to the NLGFC for consolidation.

The consolidated budgets are presented by the Minister of Local Government and Rural Development in Parliament for legislators noting. The Executive Director said the NLGFC would through these hearing/ sessions ensure that all council budgets conform to the guidelines that were provided during budget briefing sessions which took place earlier in the year.

Among other things, realistic local revenue estimates, alignment of budgets with national and sectorial policies, appropriate allocations to various functions of the councils such as audit functions, clearing salary arrears for direct employees, PAYE arrears, related councils debts, and IFIMIS infrastructure have to be taken into account in council’s budgets for the 2020/21 financial year.

Council were also encouraged to take appropriate revenue enhancement measures to ensure they collect realistic revenue for their operations.

The review for the 35 council budgets is expected to lead to a consolidated Local Authority Program Based Budget for 2020/21 financial year for the national assembly budget deliberations

The National Local Government Finance Committee (NLGFC) has successfully ensured preparation and submission of 2017-18 and 2018-19 for all the 35 Local Councils Financial Statements to National Audit Office for audit.

The remarks were made by the Executive Director of NLGFC, Mr Alifeyo Banda during the quarterly NLGFC staff review meeting held on Monday, 16^th March 2020 in Lilongwe.

Alifeyo Banda said the submission of the Financial Statements from all the thirty-five councils were an exceptional achievement as it was the first time this had happened.

In his remarks, Director of Finance for the NLGFC Kondwani Santhe said the ‘submissions are in line with the financial legal framework provisions of the Public Finance Management Act, (2003), the Public Audit Act, (2003), and Local Government Act, (1998)’. He said the financial legal framework provides that councils are to keep proper accounting records, which discloses with reasonable accuracy at any time the financial position of the Council and ensures that the financial statements are prepared and submitted for audit at least within three months after end of the financial year.

The submissions come following increased focus by the NLGFC to enforce compliance by councils to the expected legal mandate following years in the past where other councils had not prepared financial statements, accruing between 1-5 years.

The Executive Director has since assured the Government, all Malawians and Development Partners that the NLGFC will ensure that all local councils in Malawi are audited regularly by the National Audit Office and that Controlling Officers and other officers in local councils found to be on the wrong side of the financial laws will be held to account and taken to task for any deviance.

The National Local Government Financial Committee is mandated by the Constitution (Sec. 149) to facilitate fiscal decentralisation, development, financial management and compliance through resource mobilisation, allocation, disbursement and accounting in Local Councils.

The National Audit Office confirmed in a separate interview receipt of the financial statements and had since commenced audits in the councils.

Lilongwe district council agriculture office says the new enhanced public works program (EPWP) will no longer overburden extension workers from a single entity because the programme emphasizes on team work.

Land resources conservation officer for Lilongwe East, Oswald Mulenga said this in Mponela, Dowa where extension workers were trained in integrated catchment management (ICM) under EPW programme funded by World Bank.

“In this programme, an extension worker will not carry all the burden alone as we used to do in the past going into communities as single entities. Within the district council, all extension workers will be working as a team, those from fisheries, land resource, forestry, irrigation and community development among others,” explains Mulenga.

He says all players together with communities in their locations will identify priority problems and bring out solutions to address them whether related to land resource, forestry, fisheries or road network.   

During a community mapping, problem and solution identification in Senior Group Village Headman Chikhutu in Traditional Authority M’bang’ombe, with extension workers guidance, over 200 villagers that participated prioritised  issues such as soil erosion, loss of soil fertility, deforestation, gullies, poor road network .

Chikhutu said, community members under Chivundi catchment resolved to rehabilitate the area by planting trees, making and applying compost manure in their gardens, rehabilitate roads and fill the gullies with gravel and improve the drainage system of the roads.

“The project (climate smart PWP) and government should help us with tree seedlings and manure making skills to restore our environment,” says GVH Chikhutu.

Chifundo Chikolokoto, a community development officer in TA M’bang’ombe says,”There were appraisals that were made to identify the EPWP catchments. Communities and the council found that Kavunde catchment area especially in Chiweza 1 and Chikhutu are highly degraded, there is deforestation in the areas, there are low crop yields and lots of galleys.

On the support she will provide as extension worker Chikolokoto says, “We will help the community to properly plan, implement, monitor and report on the activities of the progamme. As extension workers we supervise implementation of all activities.

This programme will be guided by different sectors and extension workers who will provide technical expertise in the EPWP catchments.”

In this pilot phase of nine months (April to December, 2020), the progarmme is implemented in ten districts of Chitipa, Karonga, Kasungu, Dowa, Nkhota kota, Lilongwe, Balaka, Chiradzulu, Blantyre and Phalombe. If the pilot phase is successful, the programme will be rolled out to all 35 district councils in the country.