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Republic of Zambia Appendix 2 Outstanding Issues Report

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REPUBLIC OF ZAMBIA APPENDIX 2 OUTSTANDING ISSUES REPORT ON THE PREVIOUS REPORTS OF THE COMMITTEE ON LOCAL GOVERNMENT ACCOUNTS AND PUBLIC ACCOUNTS COMMITTEE ON THE REPORTS OF THE AUDITOR GENERAL FOR THE FINANCIAL YEARS ENDED 31ST DECEMBER, 2011 to 2017 TABLE OF CONTENTS INTRODUCTION 1 PART I CONSIDERATION OF THE TREASURY MINUTE ON THE REPORT OF THE COMMITTEE ON LOCAL GOVERNMENT ACCOUNTS ON THE REPORT OF THE AUDITOR GENERAL ON THE REVIEW OF OPERATIONS OF LOCAL AUTHORITIES FOR THE FINANCIAL YEARS ENDED 31ST DECEMBER, 2015, 2016 AND 2017, FOR THE FOURTH SESSION OF THE TWELFTH NATIONAL ASSEMBLY, APPOINTED ON 21ST SEPTEMBER, 2017 Chadiza District Council. 1 Chama District Council 2 Chililabombwe Municipal Council 15 Chinsali Municipal Council 17 Chipata City Council 20 Chirundu District Council 26 Choma Municipal Council 30 Chongwe Municipal Counci 34 Ikelengi Municipal Coucil 37 Isoka District Council 42 Kabwe Municipal Council 48 Kalabo District Council 56 Kaputa District Council 60 Kasama Municipal Council 62 Kawambwa District Council 69 Livingstone City Council 71 Luano District Council 83 Lufwanyama Municipal Council 85 Lundazi District Council 86 Lusaka City Council 91 Mansa Municipal Council 91 Mbala Municipal Council 92 Mongu Municipal Council 93 Monze District Council 97 Ndola City Council 99 Petauke District Council 106 Rufunsa District Council 108 Serenje District Council 110 Sesheke District Council 117 Siavonga District Council 122 Solwezi Municipal Council 125 Zambezi District Council 128 i PART II OUTSTANDING ISSUES ON THE PREVIOUS REPORTS OF THE COMMITTEE ON LOCAL GOVERNMENT ACCOUNTS AND THE PUBLIC ACCOUNTS COMMITTEE FOR THE FINANCIAL YEARS ENDED 31ST DECEMBER 2011 TO 2016 Chingola Municipal Council 133 Chinsali Municipal Council 139 Chipata City Council 146 Chipili District Council 150 Chisamba District Council 152 Choma Municipal Council 157 Chongwe Municipal Council 160 Kabwe Municipal Council 164 Kalomo District Council 174 Kaoma District Council 176 Kapiri Mposhi District Council 184 Kasama Municipal Council 190 Kasempa District Council 197 Kazungula District Council 202 Kitwe City Council 206 Livingstone City Council 211 Luangwa District Council 213 Luanshya Municipal Council 217 Lusaka City Council 223 Luwingu District Council 226 Mansa Municipal Council 228 Mkushi District Council 231 Mongu Municipal Council 234 Mporokoso District Council 239 Mufulira Municipal Council 242 Mumbwa District Council 245 Mwense District Council 248 Nakonde District Council 249 Nchelenga District Council 257 Ndola City Council 261 Pemba District Council 278 Petauke District Council 281 Serenje District Council 286 Siavonga District Council 291 Solwezi Muncipal Council 295 PART III 301 APENDIX 1 307 ii Introduction Part I of this report contains the Treasury Minute on the Committee on Local Government Accounts on the Report of the Auditor General on the Review of Operations of Local Authorities for the Financial Years Ended 31st December, 2015, 2016 and 2017, for the Fourth Session of the Twelfth National Assembly and the respective responses by the Secretary to the Treasury. Part II of this report is a summary of all outstanding issues on the previous reports of the Committee on Local Government Accounts and the Public Accounts Committee for the Financial Years Ended 31st December 2011 to 2016. In following up on the matters, the Committee on Local Government Accounts has given new recommendations and awaits new responses from the Secretary to the Treasury. The entire report contains matters that have not yet been closed and hence the numbering follow the original order in the Auditor General’s Report for easy traceability. The Committee of Officials comprising of National Assembly, Auditor General, and the Ministry of Finance held 60 sittings from June 2020 to April 2021 to review matters that were either partially resolved or totally unresolved from the recommendations of the Public Accounts Committee and the Committee on Local Government Accounts reports for the Financial Years Ended 31st December, 2011 to 2017 in the Treasury Minutes (Action- Taken Reports) submitted by the Executive through the Secretary to the Treasury’s Office and tabled before Parliament by the Honourable Minister of Finance. These formed the working documents on Outstanding Issues after the review of the Treasury Minutes for the respective financial years. The Committee resolved to close some matters after consideration of the follow ups made. The Secretary to the Treasury is strongly urged to ensure that a committee of officials and officers from the Department of Local Government Services at the Ministry of Local Government undertake follow up actions to reduce the volumes. PART 1 OUTSTANDING ISSUES ON THE REPORT OF THE COMMITTEE ON LOCAL GOVERNMENT ACCOUNTS ON THE REPORT OF THE AUDITOR GENERAL ON THE ACCOUNTS OF LOCAL AUTHORITIES FOR THE FINANCIAL YEARS ENDED 31ST DECEMBER, 2015, 2016 AND 2017, FOR THE FOURTH SESSION OF THE TWELFTH NATIONAL ASSEMBLY, APPOINTED ON 21ST SEPTEMBER, 2017 CHADIZA DISTRICT COUNCIL AUDIT QUERY PARAGRAPH 7 d) Misapplication of Funds - Equalisation Funds K3, 242,883 The Committee previously expressed concern over the failure by the Council management to ensure that other revenue mobilisation strategies, including updating its valuation roll, are employed to improve the liquidity of the local authority. It saddened the Committee that management willfully chose to misapply the 20% portion of the Local government Equalisation Fund (LGEF), contrary to the Local Government (Amendment) Act, No. 12 of 2014 and the Ministry of Local Government and Housing Circular No. MLGH/71/1/87 dated 30th March, 2015. The Committee found this situation unacceptable and the Council Secretary was strongly cautioned to desist from this practice. The Council Secretary was 1 further urged to ensure that the Council’s revenue base is improved so as to avoid this and similar irregularities. The Committee also directed the Council Secretary to expedite the reimbursement and submit all relevant documents to the Auditor General for verification. The Committee would await a progress report on the matter. Treasury Response The matter was verified by the Office of the Auditor General and recommended that it remained outstanding until the outstanding amount totaling K1, 963,172 was reimbursed and details availed for audit scrutiny. Committee’s Observations and Recommendations As reimbursement details have not yet been availed to the Office of the Auditor General, the Committee resolves to leave the matter open. The Secretary to the Treasury is directed to ensure that all available options are employed to ensure that the matter is resolved without further delay. A progress report will be awaited by the Committee. f) Failure to Obtain Title Deeds - thirty-six (36) properties The Committee previously expressed concern at the failure by the Council to secure its properties with title deeds. The Council Secretary was reminded that it would be difficult to defend themselves in case of disputes that may arise in relation to ownership of any of its properties. The Committee urged the Council Secretary to ensure that all its properties were secured with title deeds without any further delay. The Committee awaited a progress report on the matter. Treasury Response The matter was verified by the Office of the Auditor General and recommended that it remained outstanding until the remaining title deeds were obtained and availed for audit scrutiny. Committee’s Observations and Recommendations As title deeds have not yet been obtained and availed to the Office of the Auditor General, the Committee resolves to leave the matter open. The Secretary to the Treasury is directed to ensure that all available options are employed to ensure that the matter is resolved without further delay. A progress report will be awaited by the Committee. CHAMA DISTRICT COUNCIL AUDIT QUERY PARAGRAPH 8 a) Failure to Provide Receipt Books - K891, 498 The Committee previously found the reasons given for this irregularity unacceptable and observes that this practice could be used to conceal fraudulent activities happening at the Council. The Committee previously urged the Council Secretary to ensure that stern disciplinary action is taken against officers who failed to avail the receipt books to the auditors at the time of audit. The Committee directed that more concerted efforts be made to trace these documents and avail them for audit verification not later than 31st December 2019. The Committee awaited a progress report on the matter. 2 Treasury Response The matter was verified by the Office of the Auditor General and recommended that it remained outstanding until receipt books supporting deposits amounting to K657, 330.05 was availed for audit scrutiny. Committee’s Observations and Recommendations As supporting deposits have not yet been availed to the Office of the Auditor General, the Committee resolves to leave the matter open. The Secretary to the Treasury is directed to ensure that all available options are employed to ensure that the matter is resolved without further delay. A progress report will be awaited by the Committee. e) Failure to Update Valuation Roll The Committee previously found the lack of seriousness and laxity on the part of officers tasked with the responsibility of following up the preparation of the valuation roll unacceptable and calls for disciplinary action to be meted out against them for failure to perform their duties. The Committee previously noted with concern,
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