Katawa Market in Mzuzu: A structure supposedly constructed with COVID-19 funds stalled in 2019

For more than two decades, Lifa Andrew Phiri has known no other job than vending at Katawa market in the northern city of Mzuzu, Malawi.

But plans coming from Capitol Hill, Malawi’s seat of Government in the capital city, Lilongwe, may oblige him to pay taxes, costing him his share of sleepless nights, as well as some resentment towards the Government.

He says the plan to tax informal traders “does not make sense” since the market where he and other vendors operate lacks basic structures such as stalls.

Phiri wonders what happened to Covid 19 funds that were earmarked for the upgrading of the market but he and other vendors have been searching for answers since 2020 to no avail

The K6.2 billion intended for COVID-19 was the subject of a forensic audit report by the country’s Auditor General in 2021, which showed how district councils had diverted money for personal allowances and other purposes. For instance, the Government gave the Mzuzu City Council (MCC) K35 million in April 2020 to help implement measures to stop the spread of the coronavirus.

At the time, MCC’s PRO MacDonald Gondwe acknowledged receiving the funds and stated that the Council had already established instructions for using the funds for their intended use.

But the country’s Auditor General indicates that some funds may have been diverted at Mzuzu City Council.

However, at Mzuzu City Council, K3,229,015 was spent on procuring cement, quarry stones, river sand, and fuel for the construction of the Chiputula market. But no construction was done. It was also used to pay wages for labourers and supervisors during the construction of Katawa Market.

Katawa Market Committee members showing the fence and the part which was not completed

“The money was not enough to embark on both projects. Hence the money finished. The allocation was used to purchase construction materials for the Katawa Market as well as allowances for the labourers that were doing the constructing the job. These labourers were our employees from the engineering department because we needed to use cheap labour for us to achieve more,” MCC’s PRO MacDonald Gondwe said in a written questionnaire.

Chiputula Ward Councillor Hiwet Mkandawire (Left) blames Traders at Chiputula Market for stalling the project

Government guidelines on the use of COVID-19 funds are contained in a circular REF. MOLGRD/1/21 dated 19th May 2020 in paragraph five under financial guidelines explicitly stated that the funds were not to be used for other activities or borrowed for other uses that were not related to the fight against COVID-19.

At its peak, the Covid-19 pandemic ravaged many souls in Malawi. Amid that, the Government and different concerned stakeholders embarked on measures to mitigate the impact the scourge had on citizens, but to the disadvantage of many, procedures on the management of Covid-19 funds were flouted.

Mzuzu City Council (MCC) was one of the local Government structures managing the Covid-19 funds. It was meant to decongest markets within the city to control the spread of the virus.

While the Ministry of Local Government, in a memo dated May 19, 2020, under the financial guidelines for the disbursement of Covid-19 funds, stated that the money should not be used for other activities but the Mzuzu City Council disregarded this and used some funds to construct a fence at Katawa Market.

Documents we have seen show that the council procured cement, quarry stones, river sand and fuel for the officers supervising the construction of the fence.

But Mzuzu City Council CEO Gomezgani Nyasulu deliberately flouted government regulations on the use of COVID-19 Funds and authorised payment amounting to K3, 229,015 which was spent on the procurement of cement, quarry stones, river sand, and fuel for the construction of the Chiputula market. But no construction was done.

The Ward Councilor for Chiputula Ward Hiwet Mkandawire said in a written response that construction of Chiputula Market stalled because of misunderstandings with Traders at the market. He did not clarify the nature of misunderstandings but disclosed that at the time when the project stalled, the Mzuzu City Council had used MK1,5 million for procuring cement, bricks, sand and quarry stones.

“Unfortunately, 20 bags of cement got expired because women Traders chased the Builders and other workers away,” Mkandawire said.

In another incident, Nyasulu also authorized payment to pay wages for labourers and supervisors during the construction of Katawa Market.  Again, no construction was done.

Mzuzu City Council CEO Gomezgani Nyasulu deliberately flouted government regulations on the use of COVID 19 funds in 2020 and has never been held accountable

Nyasulu was one of the 27 CEOs and DCs that were interdicted following President Lazarus Chakwera’s directive on February 14, 2021, through the Secretary to the President and Cabinet for appearing before the Presidential Task Force on Covid-19 without backing documents for their expenditure reports.

The interdictions, which also affected personnel from other government ministries, departments and agencies, were meant to pave the way for an independent audit of the K6.2 billion allocated to the national Covid-19 response between September and December 2020. Councils received K1.3 billion, while the rest was distributed to other clusters.

However, in May 2021, the government made a U-turn by reinstating all 27 District Commissioners (DCs) and seven Chief Executive Officers (CEOs) that were interdicted in February 2021 to pave the way for an investigative audit on how K6.2 billion Covid-19 funds were used. Ever since nobody has been held accountable for misusing the COVID-19 funds despite glaring evidence in the audit report.

Paradoxically, a visit to Katawa market showed a stalled fence project and a disgruntled market committee which feels left out during the implementation of the whole project.

The Katawa Market Committee Chairperson, January Phiri, says the committee has been asking for a perimeter fence from the council to make the market more secure.

According to Phiri, it was at the peak of Covid-19 when Katawa Ward Councillor Monica Simwaka convened a meeting briefing them that she had secured K1.8 million in funding from organizations for the fence, although documents show that K3.2 million was allocated for the project from the Covid-19 funds disbursed by the central government.

Phiri says Simwaka requested them to come up with a building committee to run the project.

“Unfortunately, the committee was bypassed in the construction of the fence even though there was a need for a committee member to be part of the whole procurement process,” said Phiri.

Phiri adds that Councillor Simwaka managed the project by herself.

“She brought bricks, quarry and cement, and they employed someone to construct the fence. We never questioned her for bypassing our committee because all we wanted was our security,” she said.

According to Phiri and his fellow committee members, the council rejected their initial plan of extending the market.

“Even during their project supervision, they did not involve us as a committee. We were forcing ourselves into their team to seek more information and clarifications on the project,” explained Phiri.

He adds that they could not question their Councillor on the procedure because they felt inferior to her.

“How could we question her, the boss, when we are nobody? That can be tantamount to some insults. There was nothing we could do about it,” said Phiri.

When asked for comment, Councilor Simwaka refused and referred the reporter to Mzuzu City Council Public Relations Officer MacDonald Gondwe.

Responding to a questionnaire, Gondwe said the project was initiated by a Public Health Emergency Committee (PHEMC). According to the law, this special committee managed COVID-19 funds in the city, which was supposed to decongest people in some public places, including the markets.

Gondwe said the council did not use any contractor to construct the fence but its workforce from the engineering department of the Mzuzu City Council.

“We have the building section tasked with doing the job. The builders were not paid anything because there was already a Council salary.

“We provided some lunch allowances since they devoted themselves to working even during lunchtime. So, whilst missing lunch at duty, the committee provided some lunch allowances for the days they were working on the fence,” explained Gondwe.

He further said the council did not flout any procurement procedures and that Councillor Simwaka did not bypass the market structures.

“It is surprising to hear that because all relevant structures at all levels were informed of the interventions. Even when we went on the ground, the local systems were involved.

“Additionally, this market belonged to Mzuzu City Council and was renovated by constructing a fence. It cannot happen to start working on the fence without the market leadership knowing of the same; it cannot happen,” he said.

Meanwhile, the response is against the 2021 investigative report from the National Audit Office on the usage and accountability of the K6.2 billion Covid-19 disbursements, which show that the Mzuzu City Council mismanaged the Covid-19 funds through payment of risk allowances to its officers when implementing some of its activities.

The report says the council paid wages and allowances to labourers and supervisors for the market construction. Further, the Mzuzu City Council paid K808,000 in risk allowances while implementing some of the council’s COVID-19 activities. 

The report also made several recommendations, including that officers who took part in the malpractices that resulted in the loss of funds be made to pay them back and that all malpractices that are criminal in nature should be prosecuted. But nothing has been done to date.