Africa Confidential, a London based publication, says the fraud and corruption in the social cash donor money is nothing compared to the scandal brewing at the Zambian ministry of education.
President Edgar Lungu on 19 September fired Minister of Community Development and Social Services Emerine Kabanshi and the post master general who are at the centre of the fraud in payments for the country’s poorest families after donors froze aid.
But Africa Confidential says a bigger corruption scandal in the education ministry involving potentially tens of millions of dollars is under investigation.
It says Lungu has not commented on Africa Confidential’s reports that massive fraud has taken place in the Ministry of Education after a manipulation of the internal payments and procurements system. A government-led audit has been taking place in secret.
This is another reason for DfID’s suspension of bilateral aid. The total amount embezzled is not yet known but sources in the investigation say it is on a far greater scale than the other frauds uncovered.
The row over the departmental frauds has drawn attention to the debt crisis, about which government officials are also in denial. Africa Confidential has reported that some $489 mn. had been set aside for debt repayment in the first half of 2018, but a government statement claimed this was false, citing $342 mn. as the true figure (AC Vol 59 No 18, Bonds, bills and ever bigger debts). The government figure, however, only included interest, not interest plus repayments of principal, which was the figure we used.
In June, the government promised to cut public spending and stop new borrowing. The government currently estimates its foreign debt at $9.3 bn. However, project loans with Chinese companies not included in that figure total as much as $5 bn., many of them governed by contracts that do not allow government to hold up disbursements.
After the June pledge, however, came the news of Zambia’s purchase of two military transport aircraft for over $95 mn. with a commercial loan. Zambia also contracted provisional loans for Israeli electronics worth $400 mn.
One of the most serious payments shortfalls is hitting drugs suppliers to the health ministry, to which donors have also suspended payments. Because of government non-payment, ‘health kits’, packages of essential and commonly-prescribed drugs which are distributed to the remote countryside, have all but disappeared from view, said a senior doctor.