7th January, 2022

Media Advisory:

Funding Advise to all Local Councils – December, 2021

An approved budget of MK44.3 billion is expected to be disbursed over the nine months period up to March 2022 (excluding City Roads Rehabilitation resources). Councils have been funded a total of MK6.4 billion for the month of December 2021.  Notable funding lines for the month include:

Cumulatively, MK34.4 billion has been funded up to December, 2021 representing 78% of the annual provision excluding Rehabilitation of City Roads. Development budget lines of District Development Fund (DDF), Boreholes Fund and Infrastructure Development Fund (IDF) have not been funded and remain at 67%. Other budget lines like Health, Education, Agriculture, General Resource Fund, Education Covid response and health Covid response and Constituency Development Fund have cumulatively been funded 67%, 88%, 73%, 69%, 82%, 68% and 100%; respectively.

(Signed)

Kondwani Santhe, PhD.

Acting Executive Director

 Funding advice to LAs as of 31st December, 2021

The Anti-Corruption Bureau (ACB) says institutions which are proactive in provision of services in the public sector are a giant step in the fight against corruption in Malawi.

The remarks were made by Ezilon Kasoka the ACB’s Senior Corruption Prevention Officer and its Prevention Officer Lydia Kawiya Phiri during a weeklong orientation of the National Local Government Finance Committee (NLGFC) Internal Integrity Committee (IIC) recently at Kabumba Hotel in Salima.

‘Cases of corruption are painful to this country. However, we should not give up. The IIC at the NLGFC has its role to play and it must do so well to lead by example in the expected delivery of its mandate, by having a strong performance driven upright institution’.

Speaking during the function, Director of Infrastructure and Economic Development, Paul Chipeta, appealed to the delegates to utilize the orientation for the benefit of the NLGFC as an institution and the councils at large saying the session had come at the right moment in the fight against corruption at the NLGFC.

‘The weight of responsibility on your shoulders is so much. The weight of expectation is huge. That is why management has committed to this initiative the resources it needs and the management has physically demonstrated that through physical attendance’, said Chipeta.

The IIC core mandates includes development of corruption prevention policies and procedures; inculcate ethics in members of staff through codes of conduct and training; lead in the review of systems and procedures; and receive suspected corruption reports, conduct preliminary investigations and recommends appropriate action to management or refer to appropriate external agencies.

The orientation covered corruption prevention initiatives at the NLGFC, tools in the fight against corruption in Malawi, whistle blowing and corruption reporting and investigation, ethics and integrity, among others.

Construction works for the 351 million Kwacha New Nkhata Bay market has finally come to completion. Contractor for the project China Engineering Corporation Limited Contractors handed over the market to the district council end August.

Speaking in an interview, district commissioner Rodney Simwaka said the project is key in spurring small scale businesses while boosting local revenue at the same time.

“The other market was overwhelmed in terms of space. Traders and customers need a comfortable environment to operate in, hence the request to KFW for additional funding to make this market extension. This market demonstrates seriousness that government has towards infrastructural and economic development,” Said Simwaka

Ward councilor for Nkhata Bay Boma ward who is also the former chairperson for the council infrastructures, Cyria Adamana Nyamwera said he was glad the project had come to

completion.

“It was an eye sore to see other vendors trading by the jetty gate or the bus depot just because of lack of market space. As you know Nkhata Bay is a major tourist destination, it has to be clean at all times,” he said.

On his part, Boma Market Committee Chairperson Foster Jungu Mhone described the development as good news.

“You see when the project was starting most of us thought it was going to stall not ending,’ he said. Mhone said the constrained space as compared to the number of people plying or wanting to ply their trade in the market the challenged the council forcing other vendors to display their wares in the bus depot and along pavements.

“But with the market project now completed, and technically handed over to business and revenue too”.

Mhone also hoped the council would speed up on effecting the e-ticketing system so that the outcry about the market not producing enough revenue should be a song of the past.

According to the director of planning and development for the district Isaac Mkandawire, the market was constructed under the More Income and Employment in Rural Areas (MIERA) with funding from KfW bank with an objective of increasing market access for SMSEs.

“In addition, the project aims at improving revenue for the Council,” he said.

The project which commenced in June 2020, was expected to be completed by March 2021 but delayed due to Covid-19, will accommodate 5,000 vendors including fresh food, second hand cloth vendors and restaurants.

The ultramodern market boasts of treatment facilities for solid waste which includes recycling for fertilizer production.

‘Time for councils to front poor performance and still attract central government sympathy is over’.

The remarks were made in Blantyre recently by the Principal Secretary in the Ministry of Local Government, Charles Kalemba when he opened a day long symposium on the Local Authority Performance Assessment revised tools and processes targeting senior officers from selected local councils.

Kalemba said time to reward and tolerate mediocrity had ended.

‘There was a time we could transfer non performing District Commissioners from one district to another, for example’, he said, ‘That will no longer happen under the watch of this administration’.

Kalemba also condemned stagnation in development to below average performance of officers, fraud and corruption saying any such errant officers would be disciplined administratively as well as have institution of criminal proceedings against them.

‘Such officers have let down this country. They have failed communities and contributed to pulling this country down into a perpetual self-created poverty circus. That space for fraud, corruption and mediocrity is narrowing’, said Kalemba.

The PS also condemned councils which had failed to meet funding triggers for the World Bank Funded Performance Based Grant (PBG) under the Governance to Enable Service Delivery (GESD) project as a shame and unwanted deviation to the transformation agenda of the current government.

‘Communities expect development through the projects. This has now been denied to them. Government expects these projects to uplift the living standards of citizens and to deny citizens development due to unknown reasons and fail  the triggers is almost criminal’.

The Government conducts LAPA assessment meant to assess the performance of the local authorities in wide range is areas including service delivery. The results of the assessment determine eligibility for and the amount of the PBG. Balaka district council emerged as the overall best performer in the LAPA assessment of November 2020 under the GESD project.

The grant provides fiscal incentives to advance Local Authority (LA) performance by rewarding good and penalizing poor LA performance.

The World Bank funded project will run for 5 years in all the 28 district local councils in Malawi. It is jointly implemented by the Ministry of Local Government, the Ministry of Finance and the National Local Government Finance Committee (NLGFC) which also acts as a fiduciary agent for the project.

www.nlgfc.gov.mw 

The Ministry of Local Government has appointed Mr. Ben Tohno as Acting District Commissioner for Nkhotakota.

In a memo dated 1^st September, 2021, Secretary for Local Government, Charles Kalemba informs Tohno that the appointment follows the demise of District Commissioner Blessings Nkhoma.

Kalemba says, ‘the appointment is in line with section 11 (a) (2) of the Local Government (Amendment) Act, 2010’.

Speaking in an interview with the NLGFC Newsletter, Mr. Tohno said the appointment while humbling, ‘is an opportunity for residents and investors to work together for development and transformation of the district’.

The appointment is with effect from 1^st September, 2021.

The Parliamentary Committee on Local Authorities in Malawi says the workmanship of abandoned structures for the rural growth centre in Monkey bay is horrible.

The sentiments were made at the end of a tour, end August, of the stalled MK3 billion Monkey Bay Rural Growth Centre project 5 years after its commencement.

Speaking to the NLGFC Newsletter, chair of the Parliamentary Committee, Hon. Horace Chipuwa, Member of Parliament for Lilongwe Mapuyu North bemoaned the visible dereliction of supervision duties by the council and central Government.

He bemoaned the laissez-faire supervisory approach evident through what he termed, ‘horrible and no joy infrastructure’, at huge cost to Malawians.

‘The construction standards are not good. It shows there was no supervision by the local council and probably no coordination between central and local governments’, Chipuwa said.

The committee also expressed displeasure on the still non-operational Monkey bay bus depot which they said had accelerated its dilapidation and subjected it to vandalism.

The rural growth centre works included an abandoned community ground, dilapidated bus depot, Fish drier, rice mill, etc.  

Peter Limbali, the revenue collection officer for the depot asked for increased sensitization to enable users and operators to operate from the depot and in so doing increase revenues for the councils.

In his remarks, member of the Parliamentary Committee, Hon. Chimunthu Banda, said the Mangochi council would do well to learn from other councils such as Nkhotakota which had done what he called a commendable job in increasing locally generated revenue such as the reigning in of taxi operators into designated areas and other vehicle operators to increase the council’s revenue.

‘In Nkhotakota taxi operators now have red number plates which means that yellow and black are reserved for family cars. If you increase enforcement by the Police, the revenue generation increases dramatically’, said Banda.

In his remarks, Mangochi District Commissioner, Raphael Piringu attributed the poor workmanship to absence of involvement of the local authority in the rural growth centre project which is turning into a white elephant.

He bemoaned the fact that despite there being a devolution policy, some sectors were yet to be devolved to local councils.

On increased local revenue generation, the DC informed the parliamentary committee that the council had undertaken learning visits to Balaka, Ntcheu and Dedza to enhance their capabilities on revenue collection, enhancement and efficient utilization of the collected resources. He said they would also visit Nkhotakota.

Ministry of Local Government made a commitment to complete the Monkey bay community ground using Government of Malawi resources as the ADB project which funded the facility had ended.

District Commissioner for Mangochi, Raphael Piringu said the council would engage the Ministry of Local Government to finish the rural growth centre and improve on the shoddy workmanship which the committee had highlighted.

He said as an example, in a different project, the security agents housing units’ project, Mangochi council is at 85% of completion to the satisfaction of central government. He attributed this to the involvement of the local council.

On its part Ministry of Local Government spokesperson Anjoya Mwanza told this paper that the ministry will fulfil this promise as soon as possible despite that it is overwhelmed with current infrastructure projects.

In his remarks, NLGFC’s, Director of Infrastructure and Economic Development, Eng. Paul Chipeta said, ‘the NLGFC had learned from some short comings and if you go to projects now, what we are doing, there is flawless coordination and supervision’.

He also stated that the market and bus depot didn’t go through the defects liability processes because it was done by two different contractors.

Chipeta said the second contractor was not in a position to commit quality assurance on works done by another contractor.

The Parliamentary committee says it will present its findings in a report to Parliament when it is in session with recommendations for redress. The committee says such projects were a ‘pain in the flesh’ to most Malawians.

Similar projects have successfully been undertaken at Malomo in Ntchisi, Jenda in Mzimba and Chitekesa in Phalombe.

KNOW THE LOCAL AUTHORITY PERFORMANCE ASSESSMENT (LAPA) TOOL

1.0       LAPA Tool

The Ministry of Local Government through Governance to Enable Service Delivery (GESD) project conducted LAPA for 2019/2020 Financial years in November to December, 2020 as a precursor for Performance Based Grant (PBG). The results of the assessment will determine eligibility for and the amount of, the PBG that will supplement the District Development Fund (DDF).

The Local Authority Performance Assessment is a tool that has been designed to help assess the performance of the local authority in wide range is areas including service delivery. The LAPA tool will:

1. Determine whether LAs have the basic capacities/safeguards to manage the development grants (to ensure that before LAs access the PBG they demonstrate basic capabilities and safeguards);
2. Provide fiscal incentives to improve LA performance by rewarding good and penalizing poor LA performance
3. Identify performance gaps and inform the development and implementation of performance improvement plans for LAs; and
4. Provide information that will be used as an input into dialogues and forums regarding enhancing local government financing and institutional performance and service delivery at both the LA and national levels.

2.0       The LAPA tool has three elements/dimensions:

1. Minimum Access Conditions (MACs) which are basic safeguards to ensure proper use of the grants. There are MACs for the Performance Based Grant which determines a LA’s eligibility to access the allocated development funding. The LAs that fails the minimum access conditions will not access the performance-based grant (PBG).  MACs are either on or off (absolute). A LA that will not meet all MACs at the time of the LAPA will forfeit its grant allocation for the coming Financial Year. The LAs that fails MACs will receive performance improvement support to help address the performance gaps identified during assessment.

To be continued

THE NLGFC recently organized a Cyber Security training dubbed “Ethical hacking’ to capacitate its ICT staff and those of selected Government Ministries, Departments and Agencies. This followed continued cyber threats affecting the management of information and ICT equipment in Organizations.

The training was aimed at helping ICT experts build competencies required to anticipate cyber-crime, respond adequately to mitigate risks and control any damages caused due to security breaches.

This will help secure various systems (e.g. Local Council IFMS, UBR, Mthandizi MIS, Social Cash Transfer dubbed ‘Mtukula pa Khomo’ MIS) that NLGFC manages together with its partners / stakeholders.

Speaking to the participants when he graced the occasion, the Executive Director of the NLGFC, Alifeyo Banda said that Cyber security covers not only safeguarding confidentiality and privacy, but also the availability and integrity of data, both of which are vital for the quality and safety of care.

It therefore follows that Cyber-breaches are costly to institutions – in terms of expense, recovery time and also through damage to reputation.

 He therefore warned ICT experts to stay alert and invest their energies in advocating for good practices in the use and management of the limited ICT resources to avoid obvious attacks that come out of lack of knowledge by ICT users.

The training was facilitated by Mzuzu University which is an accredited EC-Council training center

BALAKA district Council says the recent Local Authority Performance Assessment results in which the council scooped number one, has been possible because the council puts in place proper systems by putting relevant people in positions.

Balaka Chairperson Counsellor Patrick Botomani told the NLGFC News that, “working as a team is the tradition of our council, and we have a very vibrant team, despite that we have less resources as Balaka is small, we do not look down on that, we work very hard, we motivate the team that we have, and here we are on position one,” he said.

On his part, District Commissioner Dr. MaCloud Kadammanja told the NLGFC Newsletter that the very first thing that he did when he assumed office was to make sure that the system was up to date and vibrant.

“The Heads of Departments must always do what they came here for, and I always made sure that when we get funding, expenses must be in line with the work plans, which in time help in proper management of the funds,” he added.

The District Commissioner also highlighted that the council is consulting with multiple stakeholders on the District Development Plan (DDP) which was formulated and has the voice of the community.

“The service Committees of the councils also is another area of focus; these committees must be meeting including the Full Council as they help in making decisions unlike in some areas where the DC just sits down with few of his Directors to dictate on an issue.

“The vibrant Civil Society (CSO) network that we have also is helping a lot in shaping the council to be best, as they keep on providing checks and balances wherever necessary,” he said.

On her Part, the Chief Accountant Florence Chindenga, says Balaka District Council is in the process of updating the Quaquinnual Valuation Report QVR and this has already been included in the finance reform areas.

“We want to update the QVR to widen our financial base in terms of property rates, and once the QVR has been updated, we will be able to collect revenue from all the newly constructed structures which are currently not included in the outdated QVR,” she said

The Ministry of Local Government says review of inter-governmental transfer formulae (IGFTF) is long overdue. The remarks were said by the Principal Secretary (Administration) for the Ministry Esmie Kainja (PhD) during the opening session of the consultation review meeting for the intergovernmental formulae session in Blantyre recently.

Kainja said there is public outcry of government transfer of financial resources to match the functions which have devolved to councils. In order to facilitate fiscal discentralisation the Malawi constitution provides a guide on how financial resources are to be granted to councils under section 149 sub-section 2 with a sole consideration to economic, geographical and demographic requirements.

She observed that the introduction of the IGFTF was an effort to strengthen the fiscal transfer system expected to compel government to respond to the need for transferring more resources to local authorities.

Kainja said from an initial K3billion in the 2005/6 fiscal year the size of the budgets had grown to more than K40billion per annum. She said the review would make the formulae efficient and equitable amongst many attributes asking participants to accord the exercise the seriousness it deserves.

In order to enhance financing for councils through government granting and to respond to functions which have develved under health, education, agriculture, gender etc there is a need to match the functions with financing so that councils can respond adequately to service demands.

The review will further address the gap which exists with the current formulae which only responded to two criteria requirements of economic and geographical and bring about balances and other social and economic factors like infrastructure, demographic, poverty levels, terrain amongst others.

The participants were drawn from representatives from; Ministries of Finance, Local Government, Health, Agriculture, Gender, Education; the NLGFC, Local Government Authorities, local governance experts and the media. Santhe further said 'once the formula is reviewed it shall be approved by Parliament according to the constitution, a process which is planned to be through by February 2022.