Ordinarily; Government must be the prime landlord in the country and own offices and office complexes for its agencies.
Where Government and state systems are functional, the level of tenancy has to be low; but here in Malawi the story is different for many government departments and agencies remain tenants in privately owned offices.
This has a huge cost; time and again government fails to honor accumulated rental arrears in sums of billions of kwacha, an example of the 2021/2022 national budget where the ministry of lands requested 15 billion kwacha to carter for rentals.
Sometimes government offices have been sealed by landlords for failing to pay rental arrears.
In September 2020 the ministry of lands, housing, and urban development was stressed-out with rentals.
Strained to the limit; the ministry sought refuge from Parliament, and it asked the Parliamentary committee on transport and public infrastructure to lobby for additional funding.
At the time; the unsettled office rentals had accumulated to 13.5 billion kwacha.
So; when his patience diminished; and on August 16th, 2021 John Sichilima – landlord for offices housing the department of immigration in Karonga district sealed his complex.
By this time, it had taken him six months to wait for this government department to pay the rental arrears.
This wasn’t the start nor the end of this story, for months later on May 04th May 2022 Reyneck Matemba – principal secretary for the ministry of lands at the time raised a red flag.
At the time; he had appeared before the same parliamentary committee and the ministry had rental arrears of over 5.5 billion kwacha.
“For the sake of the public, we are owing MPICO arrears in rentals, we could not pay on time, so even though we budgeted for rentals either we do not get all the resources we had budgeted for,” said Matemba.
Matemba added that for instance the ministry budgeted for 15 billion kwacha but the treasury released 11 billion kwacha.
“Already you can see that in the future we are likely to have problems, we may not be able to pay other landlords” added Matemba.
This has been the trend and so it remains, raising questions as to why the government cannot have its offices across the country from where it can be operating.
Why must the ministry of Land continue to pay rentals for public offices renting on private property?
This story is a string and stretches affecting many government departments including the Office of the Ombudsman, which at some point feared closure after its rentals arrears had accumulated to 78 million kwacha.
Such is how the government is spending huge sums of funds on rentals.
Take Mzuzu alone, this investigation can reveal that the government is renting for the regional immigration department, regional prison offices, and the office of the registrar just to mention some.
For renting about 17 rooms as confided by an insider, each at 150, 000 kwacha the department parts approximately 2.5 million kwacha monthly translating to 30.6 million kwacha annually.
However, economics commentator Tobias Willard feels the country can’t continue on this trajectory … as such hefty rentals have serious negative implications.
“Government needs to construct office buildings, especially in cities because the rental fees pays annually is just a lot and in many cases doesn’t clear all the bills there are always arrears,” said Willard.
Willard added that if the country could free up money in those areas, the need for government to borrow could be minimized.
This is a shared observation by Professor Happy Kayuni … a social science scholar from the University of Malawi.
But for him, failure to adopt Malawi’s national public sector reforms is the reason to blame for the questionable expenditure of public service institutions.
“Since 1960’s we have introduced several reforms but you know public sector reforms are very tricky because there are several issues that you need to take into consideration and in my view, there is the issue of political economy factor,” said Kayuni.
This concern is also echoed by the transport and public infrastructure committee whose chairperson is Uchizi Mkandawire … and he wonders what happens with huge allocations approved for rentals.
“There is a huge allocation under vote 130 which is the ministry of lands going towards the payment of rentals to the extent that the amount is in billions. We had to question why we are paying all that money to rentals, the ministry of lands being the landlords?” questioned Mkandawire.
While acknowledging these huge rentals but Enoch Chingoni – ministry of lands spokesperson makes a commitment to settling off these payments.
By the same token, he unveils the government’s intention to construct Capitol Hill Twin Towers to manage space constraints.
“We have made a decision that we will be paying the landlords every quarter when we receive funding from the treasury department. However, you may wish to know that government intends to construct Capitol twin towers whose preliminary preparations are at an advanced stage” said Chingoni.
Chingoni added that the twin tower will have twenty floors and will accommodate all ministries departments and agencies in a single building.
Whilst plans remain on the cards for government to spend 60 billion kwacha on the construction of houses and offices for MPs … some have other thoughts.
Why can’t the government consider constructing an office complex for its departments and agencies across major cities and towns to cut down on these expenses?