Local official diverts money for a project, then pays immediately when journalists ask
A sector official in Gicumbi district diverted money meant to pay village agricultural extension service providers, to a different activity. He blames the district for directing him to do so.
Interestingly, the district has also opened an investigation into his decision.
In rural areas, there are individuals selected from the village level to act as agricultural extension service advisors (or ‘Abajyanama b’ubuhinzi’). They are trained on a regular basis with skills they use to help other farmers in their villages. They are not paid wages but periodic “appreciation fees”.
In Byumba sector, Gicumbi district, in Northern Province, the executive secretary Nkunzurwanda John withheld Rwf 20,000 for each of the 58 support providers in his sector which they were supposed to be paid as appreciation for their work. Up until our reporter began following up the case in October, the benefactors had not been paid the money yet they had already signed for it.
Going by the explanations from the executive secretary, such decisions taken single-handedly with complete impunity are very common. He defended the decision saying the activity on which the money was spent, was more of a priority than paying agricultural workers.
Nkunzurwanda says the total of Rwf 1,160,000 was used to conduct Itorero, a mass mobilization program. The funding for Itorero was yet to be disbursed by the district which advised that the sector uses its money that would be refunded later, according to Nkunzurwanda.
“Within one week, the benefactors will have been paid their facilitation,” he told us, yet he had ignored doing so for over a month.
During our investigation, we also established that districts are taking advantage of a system which lets Sectors pay less withholding tax for supplies from contractors. It’s called the ‘community payment approach’.
The Byumba sector executive secretary says the district executive secretary Mpayimpana Epimaque asked him to pay for Itorero, since it was urgent and would be cheaper.
So the sector official looked on his bank account and there was money meant for agricultural service providers. He allocated it to Itorero without consulting anyone else at the sector except the accountant and with no supporting official documentation for the decision. The various subordinates we interviewed confirmed they were not consulted.
Nkundurwanda told our reporter that he had supporting documents, and agreed to share them. But he later said it was illegal to share sector internal documents with any one else not authorised.
But when we put the case to the district executive secretary Mpayimana, himself the district’s accounting officer, he feigned ignorance. He dismissed the sector’s explanation that there was no money at district for Itorero, the reason why it was asked to divert money from other projects.
“We are aware of the diversion of money meant to pay agricultural service providers and we have launched an investigation to establish how the sector ended up in the situation,” said Mpayimana.
He added that the district has asked for a report from the sector. Mpayimana also denied that the district is conniving with sectors to abuse the preferential tax system meant for sectors.
Meanwhile, the agricultural service providers whose “appreciation fees” had been diverted were paid on October 8, a month after they were told to sign but not handed the money. The payment was effected a few days after Radio Ishingiro started following up the issue.
Also, a new development is that Byumba sector executive secretary Nkunzurwanda John who diverted money for community agricultural workers, has also been transferred. It was about a week after we investigated the case. Nkunzurwanda is now executive secretary of Rukara sector in Kayonza district, Eastern Province.
As for the tax system being abused by districts in connivance with sectors, it is as a consequence, resulting in the tax body RRA getting less revenue as districts are using the sector to pay lower withholding taxes.
Here is how it works; when the district is to build social infrastructure like schools or healthcare posts, or a residential settlement, it keeps 3% of the contract’s total payment. That is the withholding tax rate of 3%.
We have established that when a project is implemented at the district level, it imposes a 15% withholding tax on the contractor. This essentially means the project costs more as the contractor is charged more.
So what districts are doing is that they ask the sector to implement the project because, through the community approach, the sector imposes only a 3% withholding tax on the contractor.
According to our sources from Byumba sector, officials at Gicumbi district headquarters asked Byumba sector executive secretary to pay for the Itorero because it would have cost less due to less withholding tax.
Even when it is a commendable cost-cutting method on the part of districts, the system is being misused.
By Munyarugendo Athanase , Radio Ishingiro