The World Bank has instructed local councils in Malawi to refund K1.3 billion in funds that remain unaccounted for under the Social Support for Resilient Livelihoods Project (SSRLP), following audit reviews that revealed financial irregularities and suspected mismanagement.
The directive follows expenditure reviews conducted for the 2021/22 and 2022/23 financial years by the World Bank’s financial management team in collaboration with the National Local Government Finance Committee (NLGFC) and local authorities.
According to findings published in The Nation newspaper, the reviews uncovered significant discrepancies in the use of SSRLP funds. For instance, Nsanje District Council is expected to repay K169.1 million, of which K166 million was spent without any supporting documentation.
Meanwhile, Dedza District Council has been ordered to refund K93.1 million due to inconsistencies in procurement processes and the use of unauthorised payment vouchers.
“The reviews were to ascertain the validity of expenses, and the amounts listed below have been declared questionable and have not been validated due to noncompliance with agreed policies and procedures as detailed in the Financing Agreement and Project Implementation Manual.
“The expenses are also not in line with PFMA [Public Finance Management Act] 2022 and related Treasury instructions as well as Ifmis [Integrated Financial Management Information System] deskinstructions,” reads part of a World Bank communication.
It further states that the expenditures violated key provisions of the Public Finance Management Act (PFMA) of 2022, relevant Treasury Instructions, and guidelines under the Integrated Financial Management Information System (IFMIS).
All affected councils have been given until June 30, 2025, to refund the specified amounts through the NLGFC, which serves both as the disbursement authority and the oversight body for project funds.
In addition to financial recovery, the World Bank has instructed councils to launch internal investigations and audits to identify weak financial control areas. Councils are also expected to take disciplinary and administrative action against any officers found to have breached the SSRLP financing terms.
As part of corrective measures, the councils must now submit monthly audit reports to the NLGFC by the 10th of each month, with strict enforcement expected going forward.
