Malawi—Public Finance Management Reforms (Chuma Cha Dziko)

Client: European Union

Duration: 2019-2024

Region: Sub-Saharan Africa

Country: Malawi

Solutions: Governance

Advancing public financial management in Malawi is a complex process that requires keen understanding of how change happens within this context—the political economy, key stakeholders and their priorities, and the interrelated and systemic technical bottlenecks.

Under “Chuma Cha Dziko,” or “National Economy,” DAI works with the Government of Malawi, the Ministry of Finance, Economic Planning, and Development, and other stakeholders to achieve efficient and effective use of public resources and support the growth of the economy and development of Malawi.

In the wake of the 2014 corruption scandal known as “Cashgate,” Chuma Cha Dziko has been designed to reform public financial management in Malawi. Strengthening government systems and capabilities in public finance, internal control and public procurement, and a coherent effective tax policy regime are critical in supporting the government to improve public investments and services. Changing behaviours and established norms is an important part of this initiative.

Since 2014, the Government of Malawi has continuously reiterated its commitment to develop a strong public finance system and demonstrate accountability to its electorate, and the European Union (EU) is supporting its partner country to improve the management of public finances. With EU budget support to Malawi suspended since the scandal, the EU and the Malawian Government have agreed a roadmap back to budget support. Chuma Cha Dziko significantly contributes to Malawi’s ability to respond the requirements set out in the roadmap.

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Sample Activities

  • Work with Ministry of Finance, Economic Planning, and Development’s Public Finance Management System Division to oversee and deliver public finance reforms, support broader change management and work with all relevant counterparts across the projects components to embed innovative approach to tackle complex delivery bottlenecks.
  • Apply behaviour change and problem-driven approaches to drive forward tangible and relevant results.
  • Work with stakeholders in the Malawi public procurement system to improve transparency and accountability of public procurement.
  • Work with the Department of Human Resource Management and Development to increase control over payroll, enhance pension and payroll processing, and transferring pension payments to the terminal benefits module of the human resources management information system.
  • Support commitment control to reduce arrears and better manage debt.
  • Develop a policy and governance framework for monitoring of parastatals and other government investments.
  • Strengthen Malawi’s tax policy framework and improve internal tax and non-tax policy and planning capabilities.
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