The Roads Fund Administration (RFA) in Malawi is grappling with severe financial constraints due to the non-receipt of fuel levies, resulting in a current balance of K151.2 billion.
In a letter to the Roads Authority dated 29 November. 2024, Stewart Malata, RFA Chief Executive Officer, said the “liquidity situation is also impacting on the resources for operations of the two institutions as the other sources are far from being enough to adequately provide for operational expenses of the two institutions.”
Malata emphasized the need for prudent management of commitments, citing concerns over awarded contracts for the 2022/23 year.
“We have noted that some contracts for the 2022/23 year have been awarded. We wish to mention that such commitments compound the current challenge and further put the RA’s contractors under financial pressure as these will not be paid on time,”
Malata advised the RA to manage current and future commitments carefully to avoid compounding the financial challenge. He also stressed the importance of expense management to ensure timely salary payments and critical commitments, suggesting postponement or cancellation of non-essential activities.
The RA has also been urged to engage relevant authorities to highlight the impact of the financial situation on road conditions, emphasizing the risk of failing to undertake emergency and critical works, compounded maintenance backlog, and the dire need for road network maintenance to prevent further damage during the rainy season.
The RFA says it will continue to engage the relevant authorities for a lasting solution to the challenges.
