Researcher4701: Malawi does not have legislation on Disposal of Public Assets. This anomaly was noticed by the government. A proposal is current under consideration to review the Public Procurement Act to include the Disposal of Assets (AfDB, 2014). The lack of a Law on the Disposal of Public Assets has created a big opportunity for abuse and corruption when dealing with disposal of government property, since no clear guidelines exist (Chimgwede 2013).

According to Interviewee 1, there are occasional public notices about disposal of assets in the defence force. These mostly are in the form of public auction of administrative assets (non-military equipment). However, there is no information about their financial results. It is not also clear whether such disposals reflect in the defence budget since the defence budget is highly abbreviated and hardly accessible.

In fact, the extent of the laxity in asset disposal procedure can be reflected in the manner in which a former president traded the presidential jet with a company linked to the main defence supplier to Malawi. The deal was in part to settle outstanding debts in defence procurement (Mtika, 2014). However, it was later revealed that this was against regulation because procedures and legislation did not allow the president to dispose of national assets or award contracts (Mtika, 2014).

Researcher4701: Asset disposals are supposed be scrutinised by the National Audit Office. Article 3 of the Public Audit Act of 2003, mandates the National Audit Office to scrutinise public expenditure, revenues, assets and liabilities. The law clearly spell out the independence of the National Audit Office [Section 184(7)(8) of the Constitution of Malawi]. However, in practice, the oversight body does not have control over asset disposals in the defence force, and in most cases the audit office is made aware of disposals once they have already taken place (Interviewee 2). Furthermore, there are no reports in the public domain on asset disposals in the defence force. One case that demonstrates the lack of transparency in public assets disposal is the disposal of the presidential jet, where the Ministry of Defence was not informed that part of the proceeds from the jet sale paid outstanding debts in defence procurement for peacekeeping in the Democratic Republic of the Congo (Khunga, 2014).

Researcher4701: There is no information in the public domain relating to secret spending largely because the government does not publish the enacted budget (Etter 2013). The Defence budget is highly summarized and does not indicate allocations meant for secret items relating to national intelligence and national security (Interviewee 1). The National Intelligence Bureau also does not make public its budget. For instance, in the 2013/2014 fiscal year, parliament uncovered about MK 5 billion allocated to the national intelligence agency but apparently concealed the Office of the President and cabinet (Gondwe, 2014).

Researcher4701: While the Constitution provides the legislative frameworks for oversight in the defence sector through the Defence and Security committee, the law is not clear on oversight of spending on secret items relating to national security and military intelligence (Section 162 of the Constitution of Malawi). The Defence budget is considered highly sensitive such that it is not fully disclosed to the Defence and Security Committee and Public Accounts Committee (Interviewee 3). The information that comes before these committees does not include spending on strategic military hardware; the information is limited to less sensitive areas of operations and administrative budgets (Interviewee 4).

In fact there have been instances (in 2013) when the committee was denied information on crucial off-budget defence expenditures (Chikoko, 2014). A case in point is the arms deal of 2013 in which government used money realized from jet sale to service a debt it had with a defence company in South Africa without knowledge of the Defence and Security committee (Chikoko, 2014). This arms deal was eventually renegotiated by the successive government in 2014 after noticing grave anomalies in the whole procurement process (Matonga 2015).

Therefore, score 1 has been selected given the very limited information on defence and security budgets presented to the Defence and Security Committee.

Researcher4701: While there is evidence that the Defence Force commander and the Inspector General of Police have appeared before the Defence and Security committee of parliament on various occasions (Chikoko 2014; Kadzakumanja 2014), there is no evidence to suggest that the defence force avails audit reports on secret items to legislators (Interviewee 4). The Defence and Security Committee receives financial reports on the less detailed budgets from the defence, police and intelligence but the reports are not audited (Interviewee 4).

Researcher4701: There is no clear law that permits off-budget expenditures in Malawi's fiscal policy framework (Chapter XVIII of the Constitution of Malawi). Chapter XVIII of the constitution of Malawi provides that all government expenditure shall be made through an enabling law, and shall draw from the Consolidated Fund. However Section 181 provides for creation of Special Funds within the accounts of the Consolidated Fund which may be regulated by Parliament [section 181(3)]. And according to Section 183, these special funds may be charged with ‘certain’ protected expenditure. However, the law is not clear what these protected expenditures comprise of. Hence it is challenging to say with certainty whether the law clearly provides for off-budget expenditures in the defence sector and there is not clearly define legal framework for ensuring accountability in the management of the protected expenditures. Given this ambiguity, score 1 has been selected.

Researcher4701: There is lack of information whether or not off-budget military expenditures happen in practice. As discussed above there is also no publicly available information on the budget for the defence force as a whole. Therefore, score 1 has been selected given this low transparency and no publicly available information as to how corruption risk is managed in off-budget spending.

Researcher4701: The classification of information is legally regulated by a number of instruments. These include Official Secrets Act (1913), Preservation of Public Security Act (1960), Protected Places and Areas Act (1960) and the Defence Force Act (2004). These legal instruments vest the Minister of Interior and the Minister of Defence responsible with authority to request information to be classified on the grounds of protecting national security. For instance, the Official Secrets Act (1913), the Preservation of Public Security Act (1960) and the Protected Places and Areas Act (1960) consistently refer to the Minister of Interior as being responsible for enforcing the Act. Similarly the Defence Force Act (2004) mandates the Minister of Defence to take matters of national interest before the Cabinet and Parliament. Usually the classification of information is on the pretext of protecting national security. For instance, Section 2(a) of the Preservation of Public Security Act (1960) mandates the Minister responsible for public security to make “provision for the prohibition of the publication and dissemination of matter which appears to him to be prejudicial to public security, and, to the extent which appears to him to be necessary for that purpose, for the regulation and control of the production, publishing, sale, supply, distribution and possession of publications”

However, the law is not clear on the specific procedure that is involved. There is also lack of clarity on the oversight of the regulations for classifying information; hence it is difficult to comment on the effectiveness of oversight mechanisms. It is also worth mentioning that the laws that govern classification of information are somewhat dated and have been deemed by some as standing at odds with the right to information enshrined in the Republican constitution of 1994.

Researcher4701: Although some individual officers in the Defence Force may be involved in commercial activity, the institution as whole does not have corporate commercial interests (Interviewee 1). In fact, Article 93 of Defence Force Act Chap 12:01 of 2004 discourages serving officers to engage in any profit making enterprise or to be a director or manager of a public company or syndicate. Of course, an exception is provided in the case that the officer gets written consent from the Minster of Defence. However, there is a new law, the Public Officers’ Declaration of Assets, Liabilities and business Interests Act (2013), which demands that all public officers should declare their assets, liabilities and business interests.

Researcher4701: As mentioned above, although some individual officers in the Defence Force may be involved in commercial activity, the institution as whole does not have corporate commercial interests (Interviewee 1). In fact, Article 93 of Defence Force Act Chap 12:01 of 2004 discourages serving officers to engage in any profit making enterprise or to be a director or manager of a public company or syndicate. Of course, an exception is provided in the case that the officer gets written consent from the Minster of Defence. However, there is a new law, the Public Officers’ Declaration of Assets, Liabilities and business Interests Act (2013), which demands that all public officers should declare their assets, liabilities and business interests.

Researcher4701: There is no evidence of unauthorised private enterprise in the defence force. Section 93(a) of the Defence Force Act that outlaws commercial enterprise has an exemption for “the person [who] seeks consent from the minister [of Defence]”. The legislation gives some room for such private enterprise as long as consent has been sought from the responsible minister. There is no evidence that the government profits from this private enterprise (Interviewee 2).

However, the law does not state clearly the punishment associated with unlawful private enterprise. Therefore, score 2 has been selected.

Researcher4701: While references to discipline and professionalism are common in speeches by the Commander of the Force, there is no deliberate effort to zero in on issues of corruption. There are sporadic instances in the media and public occasions that can demonstrate leadership commitment to fighting corruption in the Force (Interviewee 2). Usually these statements are made by the Chief of Defence. The civilian Ministry of Defence is less active in this regard. For instance, in December 2014, the Commander of the Defence Force publicly regretted the involvement of some officers of the Defence Force in abuse of public funds dubbed “The Cashgate Scandal” (Kaminjolo 2014). He emphasized that these were an isolated cases, and that the public should not judge the Defence Force on the basis of these incidents. However, these statements are not stated strongly and they only infer on corruption. The Defence Force falls short in making clear statements condemning corruption. Therefore, score 1 has been selected.

Researcher4701: Formal disciplinary sanctions for personnel found to have taken part in forms of bribery and corruption exist in law. For instance, the Corrupt Practices Act (Chap 7:04 of 1995) outline a number of penalties for people found guilty of corruption. The penalties include prosecution, and the maximum sentence is 12 years in prison. But while the Defence Force Act (Chap 12:01 of 2004) identifies as crime any activity that involves corruption with regard to billeting and requisition of vehicles, it does not lay down clear disciplinary procedures for personnel found to have taken part in corrupt behaviour (Interviewee 1).

Furthermore, it is not possible to establish whether such personnel have ever been dismissed because all the cases that have come before civil courts involved retired senior military officers. This in part shows the weakness of the disciplinary procedures since it is unclear if they take effect on serving officers. In this regard the national law, the Corrupt Practices Act is applied. For instance, in May 2015 the Anti-Corruption Bureau arrested and placed under investigation two ex-army chiefs for allegedly abusing public funds while they were serving officers of the Defence Force (Sangala 2015). In another case, a retired Colonel was arrested when his company failed to supply goods to the Defence Force after receiving public funds MK 900 million.

Researcher4701: The Corrupt Practices Act 1995 (amended in 2004) provides for protection of whistleblowers and informants albeit this is only in relation to protecting their anonymity in the context of civil and criminal proceedings, according to section 51(a) of the Act. Citizens are legally obliged to report cases of corruption to either the police or to the Anti-Corruption Bureau. However, the law does not come clear on the protection of the whistle-blowers from reprisals at the workplace especially with regard to issues such as lose of job, or demotion (OECD & AfDB 2012). For instance, a civil servant working in the Registrar’s Office was demoted and removed from the payroll after raising an alarm on abuse of funds in his department. The Anti-Corruption Bureau was made aware of the incident and expressed regret. However, there was no further action on the matter (Kamlomo 2013). Such is the context within which whistle-blowing is been undertaken. Overall, instances of whistleblowing have been minimal to the extent that the Head of the Anti-graft body has expressed concern about the culture of silence (Itayi 2014).

While national legislation and strategies on anti-corruption encourage whistleblowing, there is no evidence in the public domain to suggest that the defence force accommodates this approach (Nyirenda 2015). This is largely associated with the emphasis on chain of command where it becomes difficult for juniors to report their superiors (Interviewee 4).

Researcher4701: There is a general recognition by government that positions in procurement and financial management are more prone to corruption opportunities than others (Interviewee 2). However, the government falls short of naming the specific departments or sectors that can be consider ‘high risk’ areas or the specific rules associated with such positions. With regard to procurement, the law sets some guidelines for selection of procurement officers. Specifically, Section 11 of the Public Procurement Act (2003) provides that the procurement units be staffed with personnel trained in public procurement, and should include at least two specialists whose professional qualifications have been certified by the Director to meet the requirements that shall have been issued by the Director.

In addition, Section 12 of the Public Procurement Act (2003) empowers the Director of public procurement to develop and recommend to the Minister a career development and management programme, and a system for selection, appointment and termination of appointment for the cadre of procurement professionals. However, there is no information in the public domain to suggest that specific actions are undertaken by government to enforce these provisions.

With the help of the national Anti-Corruption Bureau in 2013, the government of Malawi embarked on a process of facilitating the formation of institutional integrity committees for all government departments after which these committees will be trained on the development of departmental anti-corruption policies. It is expected that this process will lead to every government department (including the Defence Force) to develop a dedicated anti-corruption policy (ACB, 2013). However, the current state of implementation of this initiative indicates that most institutions have formed the Integrity Committees but they lack the requisite training in developing anti-corruption strategies (Interviewee 1).

Peer reviewer 1. Agree. Comment updated and sources added. Score changed from 3 to 2.

Researcher4701: While it is possible to establish the number of civilians in the defence ministry, the total number of military personnel is a mere estimate (World Bank 2015). For a number of years the Ministry of Defence has been working on a projected population of military personnel without conducting a head count (Interviewee 2). It may well be that the situation persists to date. The force strength is in the region of +/- 7000 (World Bank 2015). These estimates are provided by the Ministry of Defence to strategic partners. The lack of transparency may not necessarily be as a result of illicit motives, but rather strategic given the national security concerns that Malawi has with some of its neighbouring countries (Interviewee 1).

Researcher4701: There is no publicly available information regarding pay rates and allowances for military personnel. This information could not be found on the MOD website and on the world wide web. Of course there are instances in the media where the Defence Force is alleged to have requested government to improve salaries of soldiers (Nyasa Time 2015), but there is no information detailing the pay structure in both the MOD and the Defence Force.

Researcher4701: The system of payment of soldiers is not published (Interviewee 1); hence it is not possible to comment on the extent to which the system is well-established. There is some information from the National Assembly to indicate that proposals for discretionary adjustments of basic pay are discussed, albeit the frequency of such considerations is unclear. For instance, in 2014, the Budget Committee recommended improvement in conditions of service of defence force personnel (Malawi National Assembly, 2014).

There is no evidence to suggest that the defence force has been accessing pay irregularly. But most recently, there have been two cases when soldiers have brought matters of basic pay and allowances before government. In one case, soldiers petitioned government to increase their basic pay by 70% (Nyasa Times 2015a). In a separate instance, soldiers who had just returned from peacekeeping operations petitioned government after their benefits from a peacekeeping operation were halved (Nyasa Times 2015b). However, in both cases there has not been a publicly accessible response from government.

Score 2 has been selected given the lack of transparency of the payment system and the lack of public response from the government about late payment associated with troops that deployed on a peacekeeping operation.

Researcher4701: There is an established system of appointing senior military personnel. This is provided in law. Section 161(2) of the Constitution of the Republic of Malawi gives the president powers to appoint and remove from office senior officers and other officers of the defence force. The president makes these appointments upon recommendation from the Army Council.

As for the positions of Commander and Deputy Commander, the Army Council presents for consideration by the president a shortlist of nominated senior officers in line with Section 161(2) of the Constitution of Malawi. When the president makes his appointment, the names are forwarded to the Public Appointments Committee of Parliament, which vets the candidates on the basis of their academic and professional credentials. The Public Appointments Committee, as an oversight body, has limited powers with regard to oversight of this appointment process, because the President is given mandate through the constitution (Section 161,2 of the Constitution of Malawi).

While, progression to middle and senior positions in the Malawi Defence Force is generally according to merit where consideration is given to professionalism and requisite qualification of the officer, the appointment of Commander and Deputy Commander of the defence force has been largely perceived as being highly political (Interviewee 2). This is due to the excessive leverage that the president is accorded in law. Hence it is not surprising that every new government in Malawi has effected a change in military high command (Chapulapula, 2014).

With regard to job descriptions of senior officers, there is no publicly accessible information that relates to job functions of the Commander and Deputy Commander of the defence force. Both the constitution of the Republic of Malawi and the Defence Force Act are silent on this.

Response to Peer reviewer 1: Agree. Comment updated and sources added. Score changed from 4 to 3.

Researcher4701: A formal appraisal process for personnel promotions exist. A number of subsidiary legislation under the Defence Force Act clearly sets out procedures for promotions of senior and junior staff (Defence Force Act, 2004). For instance, the Defence Force (officers) regulations contain procedures for promotion of senior staff. The Defence Force (other ranks) regulations contain procedures for promotion of junior staff. The procedures are very systematic and merit-based.

Both sets of regulation allude to the existence of a promotions board known as the Selection Board which is responsible for determining the suitability of a candidate for promotion. The Board comprises the Deputy Commander (who is the Chairperson), the Chief of Staff (who is Secretary), Director of Personnel, Director of Training, and Director Medical Services [Sub Regulation 12 of the Defence Force (Officers) regulation]. The Selection Board makes recommendations for promotion to the Commander.

According to the Defence Force (Regular Force) Regulations, typical promotion process to any higher rank involves an examination, recommendation, Selection by the Selection Board, and a vacancy in that higher rank. Additionally, the officer shall have served a minimum of four years at that present rank.
However, there is no evidence of independence oversight of the promotions process. Considering that the Board is composed of all serving officer within the chain of command, it is difficult to justify the independence and integrity of the decisions of the board (Interviewee 1).

Although the Ministry of Defence plays a crucial role in moderating the promotion process of the Defence Force (especially for senior positions), we cannot say with certainty whether this process enjoys independent scrutiny. In terms of oversight, parliament ensures this through it role in endorsing top appointments in the defence force.

Therefore, score 2 has been selected as while there are no indications of corruption or other inappropriate conduct in the promotions process, there may be some potential for it.

Researcher4701: There is no mandatory conscription in Malawi (War Resisters, 1998; Charts Bin, 2011).

Researcher4701: There is no conscription in Malawi (War Resisters, 1998; Charts Bin, 2011).

Researcher4701: While there is no evidence currently to suggest that this phenomenon has been taking place in the past five years, an audit report of 2003 implicated the Defence Force in payment of ghost workers and pensioners (Langa 2006). The Report indicated that in the 2002/2003 financial year, MDF had lost K819,743.52 through payments to ghost soldiers and civilians, retired soldiers and duplication of salaries who were fraudulently inserted on the payroll. Since 2005, the government is implementing reforms in the payment systems. As part of these reforms employees are mandated to register to a new payroll system called Central Payment System (CPS) in an effort to update the list of government employees thereby improving the management of government compensation systems (IMF 2005). The CPS is part of an Integrated Financial Management Information System (IFMIS).
Oversight of the payment system is undertaken by the National Audit Office, the Accountant General, and the Central Bank (Reserve Bank of Malawi). However, as observed by the Reserve Bank of Malawi (2013), the CPS was designed in such a way that only cheques printed in the system should be honoured. However, government also operates a parallel manual system under which cheques are hand written. This mostly happens when there are technical problems with the system. Government communicates information about the manually issued cheques to the Bank and government officers are expected to update the IFMIS accordingly. However, delays in updating IFMIS results in a mismatch between funding and expenditure, and thereby rendering reconciliation difficult.

The National Audit Office has also complained at times that its recommendations of abuse of the system have not been acted upon by controlling officers (Langa 2006).

Score 2 has been chosen as there have been ghost soldiers in the past (five years ago) and the government is trying to reform the system but with shortcomings.

Researcher4701: The Malawi Government uses the Central Payment System (CPS) which is delinked from human resource functions and managed by the ministry of finance (Reserve Bank of Malawi 2013). The Central Payment System is part of an Integrated Financial Management Information System (IFMIS). Ideally, the separation is supposed to be throughout the ministry and the armed forces.

However, the Reserve Bank of Malawi (2013) admits that in practice, government also operates a parallel manual system under which cheques are hand written. This mostly happens when there are technical problems with the system. Government communicates information about the manually issued cheques to the Bank and government officers are expected to update the IFMIS accordingly. However, delays in updating IFMIS results in a mismatch between funding and expenditure, and thereby creating opportunity for abuse.

Response to Peer Reviewer 1: Agree. Comment updated and sources added. Score changed from 4 to 3.

Researcher4701: There is no code of conduct for all military and civilian personnel. But the Defence Force Act Chap 12:01 of 2004 gives hint to subsidiary legislation and procedures that contains regulations that touch on recruitment, promotions and efficiency among others. The only instances where the Act refers to bribery and corruption are Section 58 (b) and 59(1)(c). These are associated with billeting and requisition of vehicles, aircraft and vessels.

There are conduct standards that provides guidance covering bribery, gifts and hospitality, and conflicts of interest in the Corrupt Practices Act (chap 7:04 of 1995) (Part IV, Sections 24-33). This legislation applies to both civilian and military personnel. Section 18(1) of the Public Procurement Act (No. 8 of 2003) also provides guidance on impartiality, public interest, conflict of interest, and bribery.

Researcher4701: There is no formal code of conduct governing the defence force, which instead relies on provisions in legislation. The Defence Force has a track record of strict discipline in dealing with breaches in conduct (Interviewee 1). However, while there has been strong enforcement of regulations in matters relating to participation in politics, there is not sufficient information to suggest that the same has been the case with regard to fighting corruption (Langa 2006). But in a recent case, the Anti-Corruption Bureau, operating under the Corrupt Practices Act, arrested the ex-chief of the defence force on allegations of corruption and abuse of public funds (Tenthani, 2015). The case is under prosecution pending hearing.

Researcher4701: In most training programs on defence budgetting and procurement, corruption is tackled as a crosscutting issue (Williams and Mtenje 2013). And according to Interviewee 1, these training programs target middle and senior management of both military and civilian backgrounds. But the training are done on ad hoc basis. Some of the trainings include;
1.tThe Africa Centre for Strategic Studies Topical Symposium on Security and Development in Malawi, July 25, 2012 (ACSS, 2012)
2.tSecurity Sector Symposium on Global and Regional Threats, September 13 2012 (Nyasa Times, 2012)
3.tSecurity Sector Governance Executive Course, September, 2012 (Mzuzu University under the SADSEM umbrella).
There are no legal provisions that indicate how regular training should be.

Therefore, score 1 has been selected as anti-corruption training is conducted irregularly and informally to limited personnel.

Researcher4701: The Corrupt Practices Act Chap 7:04 of 1995 mandates the Director of Public Prosecution to prosecute all corruption cases, and further requires that outcomes of the prosecution of all cases of corruption involving public government funds be made public [Section 10(1)(f); Section 42]. This would also include the defence sector.

There have been prosecutions in recent years. For instance, between 2013 and 2014, two former senior ranking members of the armed force were accused by the Anti-Corruption Bureau after a Forensic Audit Report revealed that they were connected with unauthorised payments to suppliers (Namadzunda 2015). And while the two officers were summoned to appear before the Defence and Security Commitee and the Public Accounts Committee of Parliament, there has not been a thorough investigation of the matter, because the Defence Force has denied the Anti-Corruption Bureau access to the Army headquarters (Nyasa Times Reporter, 2015). The two deny the charges, and hearing of their case has been pended indefinitely (Gwede 2015).

Score 2 has been selected as although there is a general policy that is applicable to the defence sector to make outcomes of persecutions public, examples of effective persecutions have not been found.

Researcher4701: The Corrupt Practices Act (Part IV) does not have facilitation payments in its profile of corrupt practices, neither does the Defence Force Act of 2004. However, there seems to be a general consensus that facilitation payments are a form of bribery and hence an offence (Business Anti-Corruption Portal 2015).

Researcher4701: The military doctrine of the MDF is not fully harmonised and it is not easily accessible (Interviewee 1). Formal disciplinary sanctions for personnel found to have taken part in corruption with regard to billeting and requisition of vehicles exist in law. This is reflected in the Defence Act Ch12:01 of 2004. Specifically, Section 58(b) states that “any person subject to military law under this Act who takes or agrees to take, or demands, from a person on whom he or any other person or any vehicle, aircraft or vessel is or is to be billeted in pursuance of a billeting requisition under Part VIII any money or thing as consideration for not requiring, or ceasing to require, the accommodation for himself or the said other person or standing room for the vehicle, aircraft or vessel shall be guilty of an offence and shall, on conviction by court-martial or the High Court, be liable to imprisonment for two years or any less punishment provided by this Act.”

Similarly, Section 59(1)(c) provides that “any person subject to military law under this Act who takes or agrees to take, or demands, from any person any money or thing as consideration for directions, or any particular directions, for the provision of a vehicle, an aircraft or vessel not being given, or not being retained, under a requisitioning order under Part VIII, shall be guilty of an offence and shall, on conviction by court-martial or by the High Court, be liable to imprisonment for two years or any less punishment provided by this Act.”

However, the scope of the law is narrow and does not comprehensively cover all aspects of corruption in operations. Nor does the law indicate awareness that corruption is a strategic issue and not just a minor offense. The country has no known military doctrine addressing corruption issues for peace and conflict, but there is awareness of corruption as an issue more generally. Therefore, score 1 has been selected.

Researcher4701: The MDF has been conducting pre deployment training mainly through two international training programs namely the African Contingency Operations Training and Assistance (ACOTE) and the African Deployment assistance Partnership Team (ADAPT). The training doctrines of both programs are not accessible (Africom, Undated; US Dept of State, 2013); hence it is challenging to state with certainty the extent to which their training packages focus on anti-corruption training.

However, there have not been reports suggesting that deployed MDF soldiers have been accused of indulging in corrupt practices while on missions or that commanders have mishandled these (Google open search).

Response to Reviewers: agree. Comment updated and sources added. Score reevaluated and changed from 4 to 1 in line with the scoring criteria.

Researcher4701: Bilateral cooperating partners such as UK and USA support the deployments through training and monitoring in the field for effectiveness of the mission (Interviewee 4). However, it is not clear whether this monitoring includes corruption monitoring. This information is not publicly available (Google open search).

Researcher4701: There is no evidence of relevant guidelines or training in place on addressing corruption risks in contracting whilst on deployed operations or peacekeeping missions. Guidelines for Malawian troops deploying on peacekeeping operations are based on UN, AU and SADC guidelines (UNDPKO 2008). However, there are no relevant guidelines or training specifically addressing corruption risks in contracting. Therefore, score 0 has been given.

Response to Peer Reviewer 1: disagree. There is no evidence that relevant guidelines or training are in place for addressing corruption risks on contracting whilst on deployment. Score lowered from 4 to 0.

Researcher4701: In Malawi the Private Military industry does not exist (UNHR 2015; Williams and Mtenje 2013), nor is employment prohibited by the defence forces.

Researcher4701: The Public Procurement Act No 8 of 2003 Section 3(1) states that all public procurement (including defence and national security related) is subject to the Act.

However, some exemptions exist in the Public Procurement Act for defence procurements that are of a sensitive nature. Specifically Section 27(5) exempts the defence sector from disclosing record of national defence or national security related procurement “to the extent that such procurement is determined to be of a sensitive nature, in accordance with the schedule of items eligible for such special treatment set forth in the Regulations.”

The Section 30(2) of the Public Procurement Act further exempts the defence sector from open tendering in the case of “national defence and national security related procurement to the extent that such procurement is determined to be of a sensitive nature, in accordance with the schedule of items eligible for such special treatment set forth in the regulations.” However the law recognizes that such items as general stores, uniforms, stationery, computers and standard vehicles may not be classified as sensitive.

Section 43 of the Public Procurement Act empowers the Minister (of Finance) to create a schedule of specific items eligible for exemption. However, since the law was enacted in 2003, there has not been any indication that this schedule of exempted items was ever developed. Hence it is difficult to independently scrutinise exemptions to these rules.

The legislation has clauses specific to corruption risk. The law criminalises corrupt practice, defined as the offering, giving, receiving or soliciting of anything of value to influence the action of a public official in the procurement process or in contract execution (Section 2 of the Public Procurement Act No. 8 of 2003). It also criminalises fraudulent practice, defined as fraudulent practice means a misrepresentation of facts in order to influence a procurement process or the execution of a contract, and includes collusive practices among bidders, whether prior to or after bid submission, designed to establish bid prices at artificial, non-competitive levels and to deprive the procuring entity of the benefits of free and open competition (Section 2 of the Public Procurement Act No. 8 of 2003).

With regard to the specific conduct in procurement, Section 18(1)(d) of the Public Procurement Act of 2003 explicitly sets out that public officials involved in requisitioning, planning, preparing, and conducting procurement proceedings, and administering the implementation of procurement contracts, shall not commit or abet corrupt or fraudulent practices, including the solicitation or acceptance of improper inducements. Similarly, Section 18(2) discourages bidders and suppliers from engaging in or abetting corrupt practices, such as the offering of improper inducements; fraudulent practices, including misrepresentation of facts in order to influence a procurement process or the execution of a contract; and collusion among bidders, prior to or after bid submission, designed to establish bid prices at artificial, non-competitive levels and to deprive the procuring entity of the benefits of free and open competition.

A 2004 World Bank report on public procurement in Malawi in general details several gaps and instances of abuse. The report notes that the lack of standard bidding documents in Malawi, the poor quality of specification, frequent negotiations between procuring entity and bidders, lack of a clear mechanism for logging complaints, etc. have resulted wide spread mistakes and misuse, compromised transparency and hindered proper monitoring.

There is also evidence to suggest that legislation is by-passed in defence procurement. A recent case in point is one where the Malawi Defence was accused of paying a South African registered company $ 3.4 million for services which were not rendered (Masina, 2015).

Response to Peer Reviewer 1: agree. Comment updated and source added.

Researcher4701: While the Public Procurement Act stipulates (except for exempted items) that all defence procurement shall be subject to open bidding [Section 30(1) of the Public Procurement Act No. 8 of 2003], there is no information in the public domain relating to the defence procurement process. This can be attributed to the exemptions that are in section 27(5) and Section 30(2) of the Public Procurement of 2003. Section 27(5) exempts the defence sector from disclosing record of national defence or national security related procurement “to the extent that such procurement is determined to be of a sensitive nature, in accordance with the schedule of items eligible for such special treatment set forth in the Regulations.”

Section 30(2) of the Public Procurement Act further exempts the defence sector from open tendering in the case of “national defence and national security related procurement to the extent that such procurement is determined to be of a sensitive nature, in accordance with the schedule of items eligible for such special treatment set forth in the regulations.”

However, it is important to mention that the institutional framework for procurement exists as stipulated by Sections 8,9,10 of the Public Procurement Act No. 8 of 2003. This includes the Internal Procurement Committee (IPC) and a specialized procurement unit with a considerable number of trained staff (Chapter II, Part B and Part C of Public Procurement Regulations, 2004).

Researcher4701: There is a legal framework for oversight of all public procurement. Specifically, Section 40 of the Public Procurement Act explicitly states that &quoute;all public entities, officials, and other participants involved in public procurement shall, in accordance with this Act and any other written law, provide full cooperation and disclosure to the Director, the Auditor General, and other authorities exercising monitoring and oversight over public procurement pursuant to the laws of Malawi&quoute;. The Defence and Security Committee and the Public Account committee are among the oversight bodies for defence procurement.

However, the independence of these oversight mechanisms (especially the parliamentary committees) cannot be guaranteed because they are dominated by members from the ruling party (Interviewee 3). The committees are less transparent because record of their activities rarely comes into the public domain. There have been few occasions where activity of the oversight bodies has led to change in government behaviour. Their most recent activity with regard to defence procurement was the audit of the procurement of arms in 2013 which was considered faulty by most commentators (Chikoko 2014). Both committees summoned the Ministry of Defence and the Malawi Defence Force for questioning (Chikoko 2014). And following this enquiry, government revised some of its procedures regarding defence procurement. Particularly the government closed all special accounts of the Defence Force to improve accountability of usage of funds in the defence sector (Gwede 2015).

Researcher4701: There is no policy to disclose actual and potential defence purchases (Interviewee 1). Since the defence budget is highly abbreviated, it is very difficult to compare actual and potential defence purchases. Information on forward purchase plans for the next few years is not available. Exemptions to disclose defence procurement records on the pretext on national security exist in law. Specifically Section 27(5) of the Public Procurement Act No.8 of 2003 exempts the defence sector from disclosing record of national defence or national security related procurement “to the extent that such procurement is determined to be of a sensitive nature, in accordance with the schedule of items eligible for such special treatment set forth in the Regulations.”

Parliament had, until recently, been treating defence budgets as secretive for security reasons. However, the revelations that the Defence Force were implicated in the Cashgate scandal, and realising the marginal involvement of the Defence and Security committee in oversight of the defence function, Parliament has pressed the executive to be forthcoming on matters of national security (Chikoko, 2014).

This has prompted the government to review this position. For instance, the executive has informed parliament about plans to streamline government accounts by closing special accounts for the Defence Force and the Police Service as part of the on-going public service reform program (Gwede 2015). Whilst this may or may not ensure effective monitoring of defence budgets in the future, the current practice is such that no policy exists to disclose actual and potential purchases, and there is no publicly available information on forward purchase plans. Therefore, score 1 has been selected.

Researcher4701: Section 13 of the Public Procurement Act No.8 of 2003 lays down the basic procedures and standards that companies should follow when bidding for work in government departments (including the Ministry of Defence and the armed forces). The basic criteria include evidence of business registration, technical and professional qualification, legal and financial capacity, a track record of trading, debarment and payment of taxes [Section 13(2) of the Public Procurement Act No 8 of 2003].

The government is mandated by law not to discriminate among bidders. Section 13(5) further provides that ‘any requirement established pursuant to this section shall be set forth in the pre-qualification documents, if any, and in the bidding documents, and shall apply equally to all bidders without discrimination and only the criteria referred to in subsection (2) may be applied.”

Additionally, government requires that companies refrain from corruption in the bidding process. Specifically, Section 18(2)(c) of the Public Procurement Act No 8 of 2003 provides that &quoute;bidders and suppliers shall not engage in or abet collusion prior to or after bid submission, designed to establish bid prices at artificial, non-competitive levels and to deprive the procuring entity of the benefits of free and open competition.&quoute; However, in practice there is no evidence that government commits the bidders to sign a ‘no corruption’ clause in all contracts (Interviewee 3).

Response to Peer Reviewer 1: agree. Comment updated and sources added. Score changed from 0 to 1.

Researcher4701: Malawi does not have a National Security Policy/Strategy. The defence may have a strategy from which it derives procurement priorities but this can at best be referred to as a sector strategy. Absence of a national security policy has affected strategic development of the security sector in Malawi in significant ways.

According to Interviewee 1, earnest efforts towards development of a national policy began in 2009 when the former president commissioned a team of experts to lead the process with technical advice from the UK government. However, little consultation was done during the process which ended up in a three way effort between the National Intelligence Advisor, the Defence Force and the Police Service. The country did not see the outcome of this process, let alone a draft policy.

Again in 2012, following the events that surrounded the ascension of Joyce Banda to the presidency, the government prioritized the development of National Security Policy. The governments of UK and the USA were approached for advice (ACSS 2013). A national technical working group was formed comprising of representatives of all security sector institutions in Malawi. However, the process suffered from inadequate consultation, internal fighting regarding the coordination role of the National Security Advisor, and lack of expertise in policy development.

A draft policy document was submitted to the Office of the President Cabinet in 2014, although some (AU 2014) have argued that the form in which the document has been handed over is less than a policy but rather a set of recommendations to be considered in the future.

Given this background, Malawi does not have a well-audited national security strategy from which defence procurement derives.

Researcher4701: There is an attempt to quantify and specify defence requirements (Kamlomo 2013), however, this gets compromised by the lack of a national strategic framework to guide such important purchases (Interviewee 1). And given the secretive nature of key defence procurement [Sections 27(50 and 30(2) of the Public Procurement Act of No.8 of 2003], it is difficult to make a case for credible quantification and specification mechanisms.

Researcher4701: The law subjects defence procurement to open tendering, according to Section 13(1) of the Public procurement Act No.8 of 2003. However, Subsection 2 provides exemption in the case of “national defence or national security related procurement to the extent that such procurement is determined to be of a sensitive nature, in accordance with the schedule of items eligible for such special treatment set forth in the Regulations…”. The same subsection further states that “items such as general stores, informs, stationary, computers, and standard vehicles may not be classified as sensitive items.” And while Section 13 refers to a schedule of exempted defence items, which is referred as Schedule A in the Public Procurement Regulations, the schedule does not have the list, except a note saying that the list is “to be compiled in consultation with defence officials” (Public Procurement Regulations, 2004, pg 106).

However due to limited information it is impossible to determine the estimate of single sourced procurement as a proportion of the overall defence procurement (Interviewee 2). However, it can be said that 100% of defence procurements that are exempted from open tendering are single sourced. For instance, most recently (between 2012 and 2014), the biggest arms procurement that was made was single sourced and it involved $145 million purchase of arms (Nyasa Times Reporter, 2015).

Score 1 has been chosen as although defence procurement is conducted as open competition in principle, the exemptions in law and practice practically mean that the majority of defence contract value is purchased single source.

Researcher4701: Section 13 of the Public Procurement Act No.8 of 2004 stipulates that public procurement shall be realized by means of open tendering proceedings. The tender boards are subject to regulations and codes of conduct. Sections 8 & 9 of the Public Procurement Act provide for code of conduct and regulation for the tender board, which is called the Internal Procurement Committee (IPC). Additionally, Chapter II, Articles 16, 17 and 18 of the Public Procurement Regulations (2004) set out principles for organizing IPCs with regard to quorum, composition and functions. Similarly, Chapter X of the Regulations establishes the framework for transparency and accountability of the procurement process. The Chapter also provides regulations on areas such as debarment of suppliers and bidders, and review procedures (Public Procurement Guidelines, 2004, Chapter X).

Furthermore, Sections 39 & 40 of the Public Procurement Act No.8 of 2003 provide for auditing of tender boards. In the same vein, Article 169 of the Public Procurement Regulations (2004) requires IPCs to keep record of the procurement proceeding, as well as all other documents generated in planning and conducting procurement proceedings, and implementing procurement contracts, to be made available for inspection upon demand by the Director, Auditor-General, and other oversight organs authorized pursuant to the laws of Malawi.

However, there is no public information regarding these audits, their outcome, and the frequency with which they are undertaken in the defence sector. Therefore, score 1 has been selected.

Response to Peer Reviewer 1: disagree. There is no publicly available information on tender board procedures, practices and audits in the defence sector. Score maintained.

Researcher4701: The Public Procurement Act No.8 of 2003 includes collusive activities in its definition of fraudulent practice in public procurement (Section 2). More precisely, Section 14(2)(c) provides that &quoute;bidders and suppliers shall not engage in or abet collusion prior to or after bid submission, designed to establish bid prices at artificial, non-competitive levels and to deprive the procuring entity of the benefits of free and open competition.&quoute; The law is not specific to defence procurement; it applies to all government procurement.

According to Article 190 of the Public Procurement Guidelines (2004), collusive behaviour can result in debarment for a maximum period of 2 years [Article 190(a) (iii & iv)]. Article 6, further provides for cancellation of procurement proceedings after opening bids in the event that there is evidence of collusive behaviour among bidders [Article 6(b) (iv)]. However, enforcement measures are not clear.

There is no information in the public domain to suggest that collusion takes place in defence procurement. But a study by Falvey et al (2008) on competition policy and public procurement in developing countries indicates that anti-competitive practices take place in Malawi especially in sectors such as milling, supply of foodstuffs, construction, and freight transportation. While not all anti-competitive behaviour is collusion, there is possibility that some of it could be as a result of collusive tendency.

Researcher4701: The law sets out the institutional framework for procurement, according to Sections 8,9,10 of the Public Procurement Act No. 8 of 2003. This includes the Internal Procurement Committee (IPC) and a specialized procurement unit with a considerable number of trained staff (Chapter II, Part B and Part C of Public Procurement Regulations, 2004).

With regard to staffing, Section 11 of the Public Procurement Act No.8 of 2003 provides that the procurement units be staffed with personnel trained in public procurement, and should include at least two specialists whose professional qualifications have been certified by the Director to meet the requirements that shall have been issued by the Director.

In addition, Section 12 of the Public Procurement Act No.8 of 2003 empowers the Director of public procurement to develop and recommend to the Minister a career development and management programme, and a system for selection, appointment and termination of appointment for the cadre of procurement professionals.

However, there is no information in the public domain to suggest that specific actions are undertaken by government to enforce these provisions especially with regard to defence procurement. But anecdotes seem to point to a weak institutional framework with less professional staff (Thom 2014). For instance, the Commander of the Defence force, in 2014, acknowledged one of the areas that need reform in the army was procurement, and that there were plans to collaborate with the UK Defence Force to build capacity in defence procurement in the Malawi Defence Force (Thom 2014).

With respect to staff rotations, Interviewee 1 observed that this policy exists in the defence force. However, he argued that it also affects the stability and continuity of the procurement department through increased training costs. And where such training is not forthcoming, the quality of procurement is seriously compromised (Interviewee 1). Of course, the justification for the rotation policy is that it reduces the temptation for senior procurement officers to get complacent since the opportunity to engage in corruption is huge (Interviewee 1).

Researcher4701: Comprehensive procedures for review of alleged malpractices by the procuring entity are provided in Sections 37 and 38 of the Public Procurement Act. The review has three stages; first, complaints can be lodged with the Head of the tender board (internal procurement committee). Second, appeals to decisions of the head of the tender board can be made to the responsible Minister (in this case the Minister of Defence) or to the Director of Public Procurement (for bids involving amounts that are above a particular threshold as provided in Procurement regulations). At this stage a review committee is constituted to systematically consider the matter. Thirdly, if a complainant is not satisfied with the review committee's determination of the matter, he/she has an option for a judicial review.

However, procurement law and its accompanying regulations are quiet on measures that would protect companies from discrimination when they use these mechanisms. And to some extent, it can be argued that Chapter X (Part D) and Schedule D of the regulations which deal with remedies are more inclined towards an administrative process that is in favour of the procuring entity. They are pitched in such a way as to protect the procuring entity from gross liability (Interviewee 2).

In practice there is no evidence (in the public domain) that indicates that reviews of this nature have ever been undertaken with respect to defence procurement. And the general picture indicates that there are few complaints coming through these official channels because bidders lack confidence in the system (World Bank 2004). For instance,up to 2004, at the Ministry of Health (which is one of the main government procurers in Malawi), less that one complaint was received annually (World Bank 2004).

Researcher4701: The law provides sanctions that the procuring executive can apply in order to punish the corrupt activities of a supplier. The sanctions range from debarment to legal sanctions, including imprisonment. According to Article 190 of the Public Procurement Guidelines (2004), corrupt and fraudulent behaviour can result into debarment for a maximum period of 2 years [Article 190(a) (iii & iv)].

And according to Section 31 of the Corrupt Practices Act Chap 7:04 of 1995 (amendment 17 of 2004), stipulates that any attempt to seek advantage in procuring withdrawal of a tender shall be an offence which, according to Section 34 of the same Act, shall be punishable by a 12 year prison sentence.
While it has been challenging to prosecute corruption cases in the past, there has been a recent rise in cases of corruption that have been committed following revelations of massive looting of public funds in Malawi since 2009 (Chilunga 2015a). Some of these funds involved corrupt practices in procurement (Chilunga 2015b).

Researcher4701: Malawi does not have a history of offset contracting in the defence sector (Interviewee 1). And according to Interviewee 4, even in the recently cancelled $145 million defence contract with a South African firm, there is not a hint of an offset. There is no law that explicitly bars defence offsets, but the defence procurement in Malawi usually deals with relatively small budgets contracts that would not justify offsets. In fact SIPRI records rank Malawi among the least spending countries on defence (Military Budget 2012). I feel the situation would have been different if the defence budget was significant.

Researcher4701: Malawi does not have a history of offset contracting in the defence sector (Interviewee 1). And according to Interviewee 4, even in the recently cancelled $145 million defence contract with a South African firm, there is not a hint of an offset. There is no law that explicitly bars defence offsets, but the defence procurement in Malawi usually deals with relatively small budgets contracts that would not justify offsets. In fact SIPRI records rank Malawi among the least spending countries on defence (Military Budget 2012). I feel the situation would have been different if the defence budget was significant.

Researcher4701: Malawi does not have a history of offset contracting in the defence sector (Interviewee 1). And according to Interviewee 4, even in the recently cancelled $145 million defence contract with a South African firm, there is not a hint of an offset. There is no law that explicitly bars defence offsets, but the defence procurement in Malawi usually deals with relatively small budgets contracts that would not justify offsets. In fact SIPRI records rank Malawi among the least spending countries on defence (Military Budget 2012). I feel the situation would have been different if the defence budget was significant.

Researcher4701: In Malawi, the activities of arms brokers and transfer intermediaries are not specifically regulated by law (IANSA 2006). There is no law that requires adequate administrative procedures regulating the activities of those who engage in small arms and light weapons brokering, including shipping and transit agents, including registration of brokers, licensing or authorization of brokering transactions as well as the appropriate penalties for all illicit brokering activities performed within the State’s jurisdiction and control, in accordance with UN regulations (Cross et al. 2003). The analysis of Cross et al (2003) of Malawi's Firearms Act of 1967 reveals that Malawi lacks national legislation that controls the use of brokers and transfer intermediaries. However, there is no evidence of a thriving environment for arms brokerage in the country (Alpers and Marcus, 2015; Lamb 2009).

Researcher4701: Details of the financing package surrounding major deals are not made publicly available prior to the signing of contracts. What come into the public domain are media leaks (Interviewee 2). For instance, the Malawi arms deal that involved the South African private firm came into the public domain unintentionally, and through the media and with contradictory level of detail (Liang 2013; Liang 2014; Odziwa 2015; Mtika 2014).

Researcher4701: While foreign bidders are allowed to participate in Malawi’s public procurement [Section30(5) of the Public Procurement Act No.8 of 2003], there is no law or regulation that formally requires that government encourage the main contractor to ensure that its subsidiaries and sub-contractors adopt anti-corruption programmes (Interviewee 2). For instance, the government's secretive dealing with the subsidiaries of a defence firm that provided arms to Malawi underscores the lack of integrity in defence procurements (Liang 2013). It has been revealed (Liang 2014) that at the margins of the defence deal that Malawi signed with this company in 2013, there were two secret transactions taking place between the Malawi government and subsidiaries of the defence firm. These included

1. a jet sale to a firm registered in the British Virgin Islands, but with links to the main defence firm. In fact, it is alleged that part of the proceeds from the jet sale were used to pay for outstanding debts that Malawi owed the main defence firm in arms procurement. (Namadzunda 2014)

2. a charitable organization linked to the main firm paid costs for the then president's interviews in a Public Relations (PR) campaign to win back donors to Malawi (Liang 2014).

Score 0 has been selected as there is no evidence of the government formally requiring the main contractor to ensure that its subsidiaries and sub-contractors adopt anti-corruption programmes, nor is there evidence of the government encouraging this informally.

Researcher4701: There is no clear evidence that the seller nation meddles directly in the defence procurement of Malawi (Kamlomo, 2013). But there are private interests in the procurement as can be seen sometimes to have political motives (Liang 2013). This is because the main defence dealer for Malawi is a private company based in South Africa, but without direct links with the South African government. However, the acknowledgement by the company that the company’s policy allows them to engage directly with the head of state in the country in which the company has on-going relationships (Mtika 2014) only supports a case for political interference that might influence acquisition decision of the buyer nation. Further, given the lack of evidence of formalised procedures for strategic planning and formulation of technical requirements in procurement, there heightened risk.

Response to Peer Reviewer 1: agree. Comment updated and sources added. Score changed from 4 to 3.