CSOs demand prosecution of individuals, DPP over ‘alleged’ abuse of funds at EGENCO

National Advocacy Platform (NAP) – network of like-minded non-governmental and civil society organizations in Malawi – has demanded prosecution of political figures and former governing Democratic Progressive Party (DPP) for their alleged involvement in abuse of finances at the Electricity Generating Company (EGENCO).

The demand follows revelations of pervasive financial and procurement mismanagement and the lack of accountability within crucial government’s institutions.

Addressing journalists in Lilongwe on Friday, a visibly concerned NAP Board Chairperson, Benedicto Kondowe, said these realities not only insult taxpayers, but also represent a deliberate omission on the part of government and its agencies.

“NAP continues to note with concern that the pervasive financial and procurement impropriety and lack of accountability not only undermine the trust of the Malawian people but also threaten the stability and integrity of our nation. Weak governance exacerbates the situation, lacking robust enforcement mechanisms and accountability for those entrusted with Malawi’s welfare,” said Kondowe.

An audit report by Mwenelupembe, Mhango & Company has revealed a staggering K6.7 billion procurement scandal at Electricity Generation Company (EGENCO), which non-state actors say is a testament to the rampant financial mismanagement and flagrant disregard for procurement regulations within government institutions.

According to Kondowe, who read the statement on behalf of his fellow CSO leaders, the audit findings expose a deeply entrenched culture of corruption and cronyism, resulting in substantial financial losses and systemic failures in oversight mechanisms.

He warned that failure to address these issues promptly risks further erosion of public trust and undermines the company’s ability to fulfill its mandate effectively.

“NAP therefore demands immediate action to overhaul EGENCO procurement practices and hold those responsible for these irregularities to account. Those responsible for the mess in procurement mess at EGENCO as revealed by the audit findings must be severally and jointly liable to foster fiduciary responsibility of the institution as a public enterprise.

“Companies or entities and individuals, including the Democratic Progressive Party (DPP) who unlawfully benefited from the fraud as contained in the audit findings be held accountable and compelled to repay the misappropriated funds with interest. EGENCO must undergo a comprehensive overhaul of its procurement practices, including the implementation of a robust procurement policy, adherence to regulatory frameworks, and enhanced oversight mechanisms,” he said.

Kondowe further demanded answers from the government on its decision to write off K11.3 billion loan under the National Economic Empowerment Fund (NEEF), arguing the decision to write off this loan is a grave injustice to Malawians.

He said the staggering loss, politicisation of the fund and escalating non-performing loans underscore systemic weaknesses within NEEF’s operations and a failure to uphold the principles of good governance.

“Immediate action is imperative to restore public trust and hold those responsible for these egregious mismanagement practices to account. Immediate release of a list of defaulters by NEEF, in accordance with Malawi’s laws, to uphold transparency and accountability. The Office of the President and Cabinet must provide a transparent statement outlining the rationale for the loan write-off, restoring public trust and accountability,” he said, further recommending that NEEF must undergo comprehensive reforms, including the enhancement of management systems and strengthening of credit management skills, to prevent future mismanagement.

In her contribution, Malawi Economic Justice Network (MEJN) Executive Director, Bertha Phiri, called for the implementation of increased transparency and accountability measures to safeguard public funds and prevent future financial mismanagement.

Phiri: Law enforcement agencies must move with speed in prosecuting these cases–Photo by Watipaso Mzungu

Phiri also proposed that parliament should comprehensively discuss the activities of NEEF, including the write-off of K11.3 billion at its next sitting.

“The government must provide a comprehensive and transparent address to the nation on the arms deal, without compromising security protocols, to restore public trust and uphold the principles of good governance. The Anti-Corruption Bureau must conduct thorough investigations into the arms deal including prosecuting any possible corrupt conduct. The investigation should be extended to the alleged payment of US$4, 983, 4 00.00, which is part of a contract price of US$19, 993, 600.00. A joint parliamentary committee on defense, budget and finance, and legal affairs committee should conduct inquiries to address maladministration and irregularities,” she said.

Phiri challenged Malawians to remain vigilant and actively hold duty bearers accountable, emphasizing the necessity of collective action and steadfast resolve to combat state and agency impunity.

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