Ministry of Works and Supply
Auditor General Anna Chifungula has disclosed over K12 billion was misapplied at the Ministry of Works and Supply on the completion of Chirundu Border Facilities and the rehabilitation of the Independence Stadium.
According to her report for the financial year ended 2008, the Ministry received a total of K15,000,000,000 and only K2,927,701,781 was spent on redesigning of the stadium while K12,072,298,219 was used for the border facilities.
The report has revealed that as at June 2009 works on the rehabilitation of the stadium had stalled.
Report has also exposed that out of a total K7 billion budgeted and released for a project, an amount of K440,828,830 was incurred leaving a balance of over 2 billion which was not utilized on the project despite two (2) interim payment certificates totaling K748,604,966 being issued in favour of the contractor.
However, the contractor was paid K383, 133,650 in March 2009 from the 2009 allocation.
On the missing payment vouchers the report has revealed that there were payments amounting to K457,063,500 involving thirteen(13) transaction in 2007 and K23,188,765 involving (4) transaction in 2008 which were not vouched and were either missing or lacked supporting documents such as receipts, local purchase orders and quotations among others.
Financial irregularities at the same Ministry were also recorded in the management of fuel, unaccounted for stores and unretired imprest.
Report states that during the year under review there were no receipts and disposal details about the procurement of fuel costing K1, 387,500,000 involving thirty (30) transactions and a further over K 70 billion involving 6 transaction procurements for stores was not accounted for.
The report further reveals that over K6 billion was also misapplied in unretired imprest involving one hundred and thirty seven (137) transactions paid to various officers in 2007 and 35 transactions in 2008 respectively.
Ministry of Local Government and Housing
The Auditor General’s (AG’s) report for the financial year ended 2008 has revealed that about K1, 553,928,015 meant for grants to local authorities were misapplied at the Ministry of Local Government and Housing headquarters.
According to the report, the misapplied funds were on unrelated activities such as payment of members’ subscription fees to ACCA and CIMA, and printing of Christmas cards among others.
Responding to the misapplication of funds on September 29, 2009, the then ministry’s Controlling Officer stated that most payments were related to general grants and House of Chiefs activities.
However, it was noted that the House of Chiefs had their own budget line and therefore the propriety of making payment from the general grant was questionable.
The AG’s report also revealed that the ministry misapplied a total of K14, 920,000,000 on the procurement of one hundred hearses out of the total amount of K50 billion provided for recurrent grants to local authorities.
The Zambia Police Service entered into contractual obligations amounting to K6,765,654,320 for the procurement of motor vehicles for the service disregarding a budget provision of K2,990,000,000.
This has resulted in an over commitment of K3,775,654,320 as has been revealed in the Auditor General’s (AG’s) report for the financial year ended 2008.
The controlling officer for the service stated in her response that the over commitment would be taken care of since the department had a three year budget plan framework called MTEF.
However, in their minutes of October 27, 2008, the central tender committee advised that it was a misdirection to commit next year’s budget to current procurements.
The AG’s report also revealed that although a total amount of K2, 990,000,000 was released, the service made payments in amounts totaling K3, 477,902,208, resulting in excess expenditure of K487, 902,208.
In explaining the excess expenditure, the controlling officer stated that the additional funds were obtained from Appropriation-In-Aid which was brought forward from the previous year.
The AG’s report however states that, the explanation was not satisfactory as Appropriation-In-Aid is meant for a particular financial year and can therefore not be carried forward to another financial year.
The report states that all unspent funds are supposed to be surrendered to the treasury at the end of each financial year.