ESCOM SPLASH K559.8M ON HIGH-END VEHICLES

10 Vehicles for over K0.5 Billion

BY PIJ INVESTIGATIONS

Electricity Supply Corporation of Malawi (Escom) is due to splash a whopping K559.8 million on new high-end cars, at a time when Malawians are experiencing the darkest side of power outage never seen before in recent history.

The government’s austerity measures have prompted Malawians to tighten their seat belts in the face of soaring commodity prices and high taxes and a recent pended four percent hike in electricity tariffs.

A notice to award a contract for the supply and delivery of the motor vehicles from the two suppliers, in line with section 48 of PPDA act No 27 of 2017, shows that the decision follows approval from the Public Procurement and Disposal of Assets Authority on May ‪18, 2022.

A Newspaper Capture of the Notice

PIJ understands that Escom, one of the underperforming agencies, which is failing to cut on perennial power outages, intends to purchase the vehicles from two suppliers, Automotive Products Limited and Imperial Motors Limited.

According to the notice, reference number ESC 018/NCB/G/FY2021-22, Automotive Products Limited is expected to supply four Isuzu D-Max 300 LS 4×4 Double Cabin Pick-ups valued at K49 500 000 million each while Imperial Motors Limited is expected to supply six Mitsubishi Pajero Sport 4×4 Station Wagons costing K60 ‪300 000 million each.

Reads part of the notice: “This award is subject to approvals from the Government Contracting Unit [GCU], Ministry of Justice, and Office of the President and Cabinet.”

The move runs contrary to President Lazarus Chakwera’s recently announced raft of austerity measures which was followed by a circular by the newly appointed Secretary for President and Cabinet (SPC) Colleen Zamba detailing measures aimed at reducing expenditure in the civil service and state-owned enterprises.

Among others, the President specifically suspended procurement of new vehicles by all agencies and departments while also banning lakeshore meetings for ministries, departments, and agencies (MDAs) with immediate effect, government officials only allowed three external trips annually, as part of expenditure cutting exercise.

Chakwera also made a directive in December last year against any purchase of vehicles and ordered ministries to review their plans for travel and procurement of new vehicles during the 2021-2023 Malawi recovery period, with the aim of reducing spending.

Chakwera warned that his government would not tolerate wastage of taxes

“I myself have not added a single new car to my convoy, but continue to use the cars inherited from my predecessor, and I am already scaling down my travel plans for the recovery period, so I expect every ministry under my administration to do the same,” he said.

The development further comes high on the heels of Admarc board suspending its Chief Executive Officer Rhino  Chiphiko following the purchase of his official vehicle, a Nissan Patrol, at K107 million.

Escom, through a spokesperson, has since defended the move, arguing it intends to replace an ageing fleet of 35 vehicles she said are more than 10 years old.

 “These vehicles were supposed to be replaced after four years. We can’t procrastinate anymore otherwise we will have more than 50 vehicles to replace at once. We need to have a minimum number of operational vehicles to deliver on our mandate,” Public Relations Officer Kitty Chingota told PIJ.

She said that initially, the vehicles were supposed to be procured last year but faced delays in getting necessary approvals from various government agencies.

However, the ESCOM board Chairperson has described the intention as bad timing as the organization is going through an economic crisis.

“It is unfortunate that the decision to purchase the vehicles came before the announcement of austerity measures. I am very sure that the purchase will wait until the recovery of the economy,” said Fredrick Changaya.

He said they will wait until the Office of the President and Cabinet (OPC), Government Contracting Unit, and Ministry of Justice give a nod to the purchase of the vehicles.

But in reaction, Centre for Social Accountability and Transparency (Csat) Executive Director Willy Kambwandira said the decision to buy the vehicles worth over half a billion kwacha does not speak to the country’s economic recovery plan and defies President Chakwera’s order on ministries, departments and agencies (MDAs) to cut on spending.

Kambwandira said it would be imperative that the procurement processes be reviewed, stressing that the move will send a wrong signal to donors.

“The decision by ESCOM to purchase such vehicles is regrettable and puts to question the integrity and oversight role of the board of directors at Escom,” he said.

Kambwandira further said it would also be important for the President to fire all controlling officers who extravagantly spend public money at the expense of poor Malawians.

In a separate interview, the Consumers Association of Malawi (CAMA) Executive Director John Kapito wondered why ESCOM has been given a go-ahead to purchase the vehicles when Minister of Finance Sosten Gwengwe, in his budget statement, indicated that such purchase of big vehicles will not be made.

Finance Minister Sosten Gwengwe

He said: “In his budget statement, the Minister of Finance said that the purchase of big cars will be stopped, how come then these parastatals get an appetite for huge expensive cars?”

Kapito further shared the same sentiments with Kambwandira stressing that ESCOM needs to review the procurement processes and focus on providing better services to Malawians by, among others, channeling taxpayers’ money to solutions that can end the numerous challenges being faced.

Chairperson for the Human Rights Defenders Coalition (HRDC) Gift Trapence described the development as uncalled for.

“This is taking Malawians for granted. You cannot purchase vehicles when Malawians are experiencing blackouts day in and day out. This is an upside-down priority. HRDC is therefore calling for the cancellation of this procurement. Let Escom channel these resources to purchase or repair equipment that can end blackouts in Malawi,” said Trapence.

Meanwhile, Solicitor General and Principal Secretary for Justice Alison Mbang’ombe has said the purchase of the vehicles is subject to some approval.

“Ministry of justice mandate is to advise on the legality of the text of the contract,” he said.