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Review Climate Fund Administrators – Non State Actors

Non - state actors in environment and climate change sector, have expressed interest to provide oversight functions to government on newly established National Climate Change Management Fund (NCCMF). They argue this will enhance the spirit of accountability and transparency and make the fund more effective in the long-term process.

Climate change fund regulations were gazetted in 2018 to operationalize the climate change fund established as a subset of the environment management fund. It will finance green initiatives as a national basket supporting adaptation, mitigation and technological transfer.

National Climate Change Management Fund

Julius Ngoma CISONECC - Clearly outline a road map on how and when the carbon levy will support climate initiatives

The aim is to improve sustainable financing through increased budgetary support for climate change management interventions with at least 60% of the required resources provided by treasury, through carbon taxes or levies. The remaining 40% is expected from development partners and private sector. However, despite having established the fund in 2019, it has not been operationalized yet.

Speaking at Hill Side Lodge at Mponela in Dowa, Chimwemwe Yonasi of Environmental Affairs Department (EAD) told participants drawn from CSO’s, academia and the media that capitalization will be sourced from external and domestic fund, private sector but also the flexibility to evolve.

“In initial stages, the fund will have thematic windows as provided for in the environment management (climate change) regulations, 2018 under regulation 4 which include; adaptation, mitigation, capacity building, education, training and awareness activities, research, technology development and transfer and systematic observation, said Yonasi adding that “Private sector will have its own funding window to harness private sector investments. Funds will be dispersed in form of loans and grants.” Yonasi told stakeholders during the meeting on 26th March, 2021.

In terms of set up, Secretary to Treasury, EAD director will oversee operations of the funds as the Manager will have to report directly to the departmental head.

However, it is the fund administration where non - state actors under the Climate Justice Advocacy programme are of the view need gap filling.

Speaking under Climate Justice Advocacy banner Julius Ng’oma, CISONECC National Coordinator highlighted as a loophole the governance structure which clearly indicate absence of a board within the rank and file of the fund administration. He argued that most of the decisions seems to be controlled by the line minister and EAD Director which mighty signify possible abuse based on past experiences in government where finances are involved.

The fund administration gaps were corroborated by academician Chris Kambani, Head of Department Environment and Natural Resources Management at Lilongwe University of Agriculture and Natural Resources.

Chris Kambani LUANAR - Fund must be controlled by a board not the director or fund Manager

“Indeed, the fund must be controlled by a board not the director who serves the government. He or she is likely to be influenced by other forces within the system. If non – state actors will have to apply to access funding, the board should be given power to scrutinise applications not the fund manager or the director,” Kambani offered alternative views adding that the fund provides an opportunity for CSO's academia, and others to access the fund to support climate justice, adaptation and mitigation activities.

Carbon Levy

Analysts have also questioned the rationale of the carbon levy, yet the actual use of the funds and how they can track the resources still remains a mystery.

In 2019, Government of Malawi introduced carbon tax on all motor vehicles. The tax was introduced as part of Certificate of Fitness and pooled in consolidated account at treasury. Environmentalists while welcoming the move, questioned the rationale of putting the levy in a pool account.

The collection of carbon tax through vehicle certificate of fitness, however ended abruptly without public awareness. Currently, carbon levy is embedded in petrol and diesel domestic pump prices and is collected by Malawi Revenue Authority through Malawi Energy Regulatory Authority.

Ng’oma was also quick to remind the executive to clearly outline a road map on how and when the carbon levy will support climate change and environmental management initiatives in Malawi. He argued that two years have passed with the collected funds being channeled to account number one.

“This is not in line with the sole objectives of setting up such a levy,” Ng’oma sounded the alarm. The forestry and natural resources management sector faces numerous challenges that needs urgent attention and is one of the most underfunded government sectors. Funds from the carbon levy are viewed to provide some additional financing towards the sector to manage challenges.

CISONECC with financial support from Scottish Government through Trocaire and SCIAF is implementing a Climate Challenge Programme Malawi – Climate Justice Advocacy Project. The Climate Justice Advocacy project aims to ensure that the duty bearers are engaged and have an improved understanding of citizens’ human rights in relation to climate change by ensuring that the Malawi Government has put in place an enabling environment to support implementation of community led climate change actions.

Under this project, CISONECC continues to support the Government of Malawi in establishing a conducive policy environment for the management of climate change and its impacts.

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About the Author
Charles Mkoka
Charles Mkoka is one of AEJ News Editorial Production Crew

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