The Bonet Framework

Context: The Democratic Progressive Party (DPP) wants to give each of Malawi’s 229 constituencies K5 billion a year through the Constituency Development Fund (CDF).

Total Cost: K5 billion times 229 constituencies is K1.145 trillion a year.

Key Concerns:

1. CDF would use up around 23% of the national budget or over half of all domestic revenue.
2. Malawi’s national debt is already 86% of its GDP, thus taking on further debt could cause a disaster.
3. If the government puts money into the economy and it doesn’t work, inflation and a lack of foreign exchange will get worse.
4. Most local governments have weaker internal control systems and won’t be good at handling a lot of money, which makes it more likely that the money will be stolen or misused if appropriate oversight systems are not put in place.
5. The CDF right now is K200 million for each constituency. A rise to K5 billion would be a 25 times’ rise.

Feasible Alternatives:

Choice	How much	Total Cost	Feasibility
Conservative	K200 million	K45.8 billion Kwacha	Achievable
Moderate	K500 million	K114.5 billion Kwacha	Possible
Proposal from the DPP	Five billion Kwacha	K1.145 trillion Kwacha	Impractical

Conclusion: The DPP’s vision of development based on seats is fine, however the suggested K5 billion annual CDF per constituency is not a good plan for the economy. A phased or capped strategy that goes along with reforms in accountability and building up local capability would be more practical.