THE Auditor General has revealed that the Luapula Water and Sewerage Company (LpWSC) delayed the implementation of the Integrated Small Towns Water Supply and Sanitation (ISTWSS) project despite funding worth US $33,453,611 being readily available.
According to the Auditor General’s report on the accounts of water and sanitation companies for the financial year ending December 31, 2019, interest of US$1,003,608 had accrued on the money and works had not commenced over two years since the signing of the financing agreement.
“On 17th February, 2017, government and Luapula Water and Sewerage Company (LpWSC) signed a financing agreement of US$33,453,611 for the purpose of financing components 1 and 2 of the Integrated Small Towns Water Supply and Sanitation (ISTWSS) project. The following were the terms and conditions of the loan agreement: The principal and interest shall be paid over a period of 25 years, including a grace period of eight years; the repayment shall be made in accordance with the amortization schedule set forth in schedule 1; the interest charged to the company on the principal amount of the loan withdrawn and outstanding from time to time shall be 1.5 per cent fixed rate. However, despite the availability of the funds, works on the project had not commenced as at 31st December, 2019, and interest of US $1,003,608 had since accrued,” the report revealed.
And it also disclosed that K135,150 in housing allowances were irregularly paid to six workers that were accommodated in company houses.
“Irregular payment of housing allowance during the period under review; housing allowance in amounts totalling K135,150 were irregularly paid to six officers in that they were accommodated in the company houses,” it read.
The report stated that K24,900 was also allocated for the implementation of the Municipal Billing Module in Pastel and provision of training to users, but was not implemented.
“Procurement of Software – Wasteful Expenditure On 18th August, 2016, a payment of K24,900 was made to GSM Micro Technology for the implementation of Municipal Billing Module in Pastel (K15,900) and provision of training to users (K9,000). It was, however, observed that as at 31st December, 2019, the Municipal Billing Module in pastel and the associated training had not been implemented rendering the expenditure wasteful,” the report read.
The Auditor General further revealed that the water utility only managed to hit a service target of 45 per cent, while sanitation services reached 31.9 per cent against a benchmark of 80 per cent.
“Water service coverage is the population serviced by domestic connections only through individual household connections, kiosks, public stand posts and shared taps. During the period under review, LpWSC did not reach its strategic goal and sector benchmark of 80 per cent as the water service coverage ranged from 30 per cent to 45 per cent. Consequently, a large proportion of the community in the province was not covered by the Commercial Utility (CU) and thus may not have access to clean water,” read the report.
“Sanitation Coverage is the proportion of the urban population with access to sanitation services. The sector benchmark was 80 per cent. However, a review of the sector report revealed that the Company was operating below the standard at 14 per cent in 2015, 26.2 per cent in 2016, 31.9 per cent in 2017 and 31.4 per cent in 2018. As a result, a substantial number of urban households did not have access to sanitation services during the period under review which could compromise public health.”