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

Public Financial Management for PRSP Implementation in Malawi
6.2.1 Funding as a prerequisite for capacity
As illustrated in the previous sections, Malawi faces severe capacity constraints
in its government institutions. One of the most important reasons for
this is the lack of resources. There are three main ways this affects the capacity
of key PFM institutions:
— Inadequate staffing of key PFM positions
— Inadequate incentives and brain drain due to low salaries in the civil
service, and
— Lack of adequate equipment to perform key PFM functions.
Lack of adequate equipment and financial resources, in particular, impedes
effective PFM at central and even more at local government level. Ample
evidence exists that officials regularly do not have transport, fuel, computers
and office stationary to carry out even simple tasks. It is a common that no
funding is provided to cover maintenance costs, even if there is enough
equipment such as cars or computers (mostly provided by donors). The research
team saw many broken and useless computers or copy machines that
would be needed for instance to produce and distribute financial reports.
Consequently, accounting and other important tasks are done manually,
which creates many errors and makes meaningful financial control a very
difficult undertaking. According to a number of interview partners, frequent
power-cuts make it difficult to use computers for key PFM tasks, in particular
in rural areas. Of course, these problems severely undermine efforts such as
those currently made by the World Bank to improve financial control through
a computerised Integrated Financial Management Information System
(IFMIS). Accordingly, the IFMIS was not operational at the time of this field
study (see Durevall / Erlandsson 2005, 22–26).
The lack of resources to perform key PFM tasks is omnipresent at central
level. In particular Malawi’s oversight institutions, such as the National
Audit Office and Parliament, are severely underfunded (see Box 13). This
affects the external control of administrative bodies at the local level as well.
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