Following the K6.2 Billion COVID19 funds scandal, in which 64 people have so far been arrested by the Malawi Police as being suspended to have been involved in the plunder of the COVID19 funds, various people have opined whether the real problem we have in Malawi is that the take home pay which Civil servants receive just isn’t enough to meet the cost of living in most parts of Malawi.

The argument goes that when you factor in the basic monthly salary most civil servants receive (below Senior posts & Director levels) and excluding benefits, it simply isn’t enough to live on considering all the expenses most people incur, including house rental, vehicle fuel, school fees and other educational commitments, food, electricity, water, mobile phone data and airtime costs and alms/ financial support to relatives. They say most Malawians struggle to keep up, and that it’s not their fault. Their pay is simply too low and has not increased proportionally with inflation levels over the years, and too little has been done to correct this anomally.

Personally, I’m sympathetic to this argument and have written about it before in the past. But considering what has been revealed in the audit report of the misappropriated K6.2 Billion, it’s necessary that tough Anti-corruption measures must first be adopted before we consider increasing the salaries of civil servants. Because the last thing we need is increasing the salaries of the very same people, who have for years been intentionally misappropriating government resources for their own self enrichment.

In a 2016 paper titled The challenge of per diem misuse: Training and travel as extra pay, Norwegian researchers Tina Søreide, Ingvild Aagedal Skage & Arne Tostensen wrote a paper for the CHR. Michelsen Institute in which they said:

‘The abuse of travel and training- related payments results in excessive expenditures and in a distortion of incentives that can frustrate development efforts. Three main factors contribute to facilitating this type of practice: insufficient controls, management (dis)incentives, and donors’ role and attitudes. Strengthening controls alone is unlikely to curb this kind of abuse, the culture of “per diem hunting” needs to be changed as part of a broader reform of the civil service. Coordination among development partners can also contribute to preventing per diem abuse.’

They went on to note that:

‘While per diem payments are supposed to be strictly compensatory, they can become a form of additional salary (Policy Forum 2009). In countries where salaries are generally low, these extra payments can amount to a significant proportion of civil servants’ total income. As a result, civil servants may be more interested in obtaining these allowances than in the content of the activities.’

One Oxford-based Malawian Political and Social commentator, Thandie Hara, commenting on the fallout from the K6.2 Billion allowances issue wrote on her Facebook wall:

“How do you expect anyone to live on MK100,000 a month in Likuni or Ntandire, when half of that will be spent on transport? “

She suggests that a cost of living assessment needs to be done for the lowest paid civil servant, such that take home pay should be sufficient to cover the basics. As a starting point, the lowest paid civil servant, be it a cleaner or a messenger should be paid no less than MK500,000 a month. According to Hara, a review of the unrealistic pay structure is necessary because currently what civil servants are paid

“does not accurately reflect the cost of living, and as a result may have inadvertently made people to believe that they are justified in stealing. “

The result, she says, is that such low pay has

“… created a looting culture with no ceiling. You will be surprised that many of the people we are calling thieves, but who see themselves as honest prayerful people. They don’t recognise theft in what they or their colleagues have been doing. It’s been normal practice for underpaid people trying to survive.“

A different Malawian on twitter was less forgiving

However, we need to be sober in that side by side with the prosecutions, which the President of Malawi is fully behind and has been pushing for, some ground rules need to be laid down:

1. Sitting allowances should be abolished in their entirety. Instead a fixed temporary salary increment should be calculated and introduced only to low pay grade civil servants – which I know begs a different question as to what are “low pay grade civil servants”.
2. Financial controls should be introduced and undertaken rigorously, with a quarterly audit of each department by external auditors. IFMIS modules that are yet to be activated in Government departments need to be switched on, and if not switched on by a certain date, the managers of those departments need to be suspended, and asked to explain why.
3. There should be a budget for the audit of each department 4 times a year.
4. There should be stiffer penalties for any form of misappropriation of state funding, including confiscation of personal property, so that a strong deterrent is set to scare off would be offenders.

And after all this has been done, only then can the debate on increasing civil servant salaries begin.

It’s not a popular position when so many people have been conditioned to think allowances are the way to earn a living, and no doubt there will be loud protests from some corners regarding this. Others will also ask ‘Where will the money come from?” Ofcourse from the same allowances being milked, but if that’s not sufficient my next post will fully address that question.

But it is the right and honourable thing to do, if Malawi and the Tonse Alliance Government is really serious about fiscal discipline that protects the country’s finances.