Public Financial Management for PRSP - Deutsches Institut für ...

Public Financial Management for PRSP Implementation in Malawi
instead. The various dimensions of each weakness are highlighted and the
causes and consequences discussed. Where appropriate, it is specified
whether the problems discussed are relevant only at central or local government
level. If not specified, they are prominent to a stronger or lesser extent
at both levels. Furthermore, the analysis is linked back to the different stages
of the budget cycle throughout the chapter. The interrelations between the
challenges identified in these key areas are discussed and linked back to the
overall findings in Chapter 7.
6.1 Capacity
Lack of adequate human and technical capacity was identified as one of the
major shortcomings undermining sound PFM in Malawi. The United Nations
Development Programme (UNDP) defines capacity as the “ability of people,
institutions and societies to perform functions, solve problems, and set and
achieve objectives” (UNDP 2002, 2). This definition is quite broad; it thus
seems useful to elaborate a bit more on how the term ‘capacity’ is used in this
study. The analysis especially concentrates on four key elements of capacity
concerning PFM: the staffing situation in public institutions, the qualification
of staff, the management of human resources, and the availability and condition
of necessary equipment and installations.
Although Malawi’s government institutions are severely understaffed, the
major problems with regard to capacity for PFM appear to be:
— Lack of adequately qualified staff in key positions for PFM
— Shortcomings in organisational and human resource management
— Insufficient equipment and financial resources
Many government and oversight institutions are severely understaffed both at
central and local government level in Malawi. It is not uncommon for ministries,
oversight institutions (in particular the National Audit Office), and local
administrations to have 30–50 % of all established positions vacant.
Box 12 illustrates how serious the staffing situation can be at the local level.
However, in some cases it often remains unclear how staffing requirements
are determined. Strong evidence indicates that all vacancies of an institution
do not necessarily reflect the number of employees necessarily needed to
carry out the respective tasks.
German Development Institute 89