Government has introduced nine expenditure control measures among them the suspension of all government funded external travel and procurement of capital assets until the end of the financial year.
The move comes amid public pressure on President Joyce Banda’s administration to cut spending in keeping with an austerity budget instituted by her government.
Independent commentators have hailed the move, but have warned it should not just be on paper.
The Office of the President and Cabinet (OPC) has made the directive in a circular dated December 7, 2012 signed by the Chief Secretary to the Government Bright Msaka and addressed to all principal secretaries and heads of departments.
“A moratorium is hereby imposed for all Government funded external travel until the end of the financial year,” reads the circular, accessed by Malawi News Agency (Mana).
“On the rare and exceptional occasion where external travel is absolutely essential and has been sanctioned by the OPC, tickets for such travel should be bought directly from the airline and not travel agents.”
The measure directs that ministerial delegations sanctioned to take an external travel should be limited to a maximum of three representatives including the minister.
The expenditure control measures also limit pool vehicles to three per ministry or department and that all other vehicles should be parked and the keys should be kept personally by the controlling officers pending the government decision on the disposal of the vehicles.
“The three pool vehicles shall be allocated 100 litres of fuel per month … where the fuel allocation is to be exceeded the controlling officer must personally authorise the additional allocation,” reads the circular.
It further directs that all stationary and medical drugs should be bought from Central Government Stores (CGS) and Central Medical Stores (CMS), respectively, and that where goods are not available, the two institutions would arrange the purchases on behalf of the ministries or departments.
The new measures rest on government institutions the responsibility of settling compensation claims where the Attorney General has failed to provide defence due to failure by the institution to provide any, or providing inadequate information.
“Ministries shall further be liable for settlement of claims arising from failure to honour contractual obligations.
“In accordance with the law, officers whose willful or negligent conduct leads to government incurring liability, loss or damage shall be surcharged for such liability, loss or damage,” the circular reads in part.
On procurement by government ministries, the circular says this should be on cash basis and that where cash terms are not possible for good reasons authority must be obtained from the Secretary to the Treasury in writing and copied to the Chief Secretary’s office.
Additionally, following the new expenditure control measures, procurement of goods and services should be accompanied by a Local Purchase Order (LPO) certified by the controlling officer or an officer not below the Grade of P4 designated in writing by the controlling officer.
The circular further says the controlling officer will be held personally liable for any mis-procurement of any goods or services.
The other directives contained in the circular says that Government Printer should be the sole supplier of printing services to Government; and proper management of lights and electrical equipment and appliances for energy saving.
The Chief Secretary has since called upon all controlling officers and heads of department to adhere to the instituted measures and that a disciplinary action shall be taken against controlling officers for any financial impropriety taking place in their ministries.
He further said the expenditure control measures “should be observed in addition to, and contemporaneously with, the measures contained in circular letters dated March 25, 2011 and another of May 5, 2011”.
One of the expenditure control measures in the preceding circular letter of March 25, 2011 was the transferring of all government vehicles and drivers to Plant Vehicle Hire Organisation to be centrally managed.
An economic commentator Henry Kachaje described the measure a positive development.
“This is a positive development because as a country we are going through a tough time. This is important because expenditure of government has a direct bearing on inflation and general liquidity levels,” Kachaje said.
He, however, asked the government to ensure implementation of the control measures.
“The measures should not just be on paper, if they fail to implement them it will just be wishful thinking,” he said.
Fierce government critic John Kapito last evening hailed the move, saying the government was moving towards the right direction.
“We are moving towards the right direction, but these control measures should not just be on paper. Other cuts are needed on the cabinet, they should be travelling in economy class both on internal and external travels, allowances and fuel should also be cut.
Kapito also said the presidency should also share the burden with other government departments on expenditure control.
“The government should also quantify the savings the country will make following the control measures because some of the government departments do not have resources and others need resources to do a good job for the country.” he said.
On his part, Minister of Information Moses Kunkuyu said the travel ban on external government funded trips was effected in October.
He said the ministers did not get the 21 percent increment.
He added: “The control measures also affect the president. The last external travel the president had was the Comesa summit. She was forced to go by Comesa because she was supposed to hand over chairmanship and they funded the trip.”