Cabinet ministers and deputy ministers who were supposed to share K351 milllion under old gratuity formula will now share K1 billion under a new formula approved by President Lazarus Chakwera.
Tonse Alliance administration ministers who have served since July 2020 will walk away with up to K40 million in gratuity instead of K15 million while deputy ministers will receive K30 million instead of K12 million.
This is according to a report by the Weekend Nation which has quoted a confidential memorandum from former Secretary to the President and Cabinet (SPC) Zanga-Zanga Chikhosi, File Ref: SPC/S/002 dated March 10 2022 titled ‘Gratuity for Former Ministers and Deputy Ministers’ as well as a schedule of payments.
In the letter, Chikhosi asked Chakwera to approve that gratuity for ministers and deputies should be based on basic pay plus benefits instead of basing on basic salary only.
“This is the case because Parliament calculates its gratuity based on the basic salary plus the amount of all fringe benefits that are paid or received.
“I, therefore, have the honour to propose, for your Excellency’s consideration and approval, that with immediate effect, the gratuity formula for ministers and deputy ministers should be fully aligned with Parliament in order to address the discrepancies that arise whenever gratuity is due,” Chikhosi said.
He added that the old formula was not being to the advantage of ministers and deputy ministers who double as Members of Parliament.
Chakwera approved the new formula on March 13.
Deputy Director at the Office of President and Cabinet PC Lyson Kandu confirmed to the Nation that the Chakwera administration has introduced the arrangement of paying 40 percent gratuity on all fringe benefits.
“This is intended to harmonise with Parliament, so that Cabinet ministers who double as members of Parliament are not disadvantaged when receiving their gratuity,” he said.
In Malawi, a Minister receives K1.8 million basic salary while a deputy receives a basic salary of K1.5 million. Under the old formula,Government would have paid K351 milllion gratuity to 20 ministers and five deputies following the dissolution of Chakwera’s cabinet in January this year.
However, using K5.5 million and K4.2 million gross salaries for Cabinet ministers and deputies respectively, Government will pay about K1 billion in gratuity.
It means more rewards for minister and deputies who already receive fuel, motor vehicle loans, security and house allowances, costing the taxpayer millions of Kwacha.
Quoting a source, The Weekend Nation reported that OPC is in the process of paying out the gratuities.
But the source argued that the new arrangement is contrary to Employment Act and Pensions Act which states that gratuity is supposed to be based on basic pay and not fringe benefits or duty facilitation allowances.
This comes as President Chakwera said his government is implementing measures to cut spending in a bid to resuscitate the economy.
Meanwhile, commentators have condemned the arrangement describing it as abuse of public resources.
“In a country where resources are scarce, such policies offer no hope for the welfare of the general public. All pronouncements on austerity will be viewed as deception. It dwindles the national morale for hard work and does not encourage efforts in the fight against corruption,” Governance expert Clemence Alfazema told the Weekend Nation.
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