UK freezes millions in aid to Zambia amid allegations of fraud and looting
Prime Minister Theresa May dancing with students on a trade mission to Africa last month CREDIT:STEFAN ROUSSEAU/PA
18 SEPTEMBER 2018 • 7:43PM
Britain has frozen its entire funding programme to Zambia amid allegations that state officials have looted millions of pounds of aid to set up shell companies and buy expensive cars.
The Department for International Development (Dfid) has also demanded a forensic audit of Zambian government spending after evidence emerged suggesting aid had been embezzled on a significant scale since 2012.
A spokesman said the move, worth £42m a year, was part of Dfid's "zero tolerance" approach to fraud and corruption.
While allegations of fraud have been levelled at a series of government departments, perhaps the most shocking involves the suspected plunder of a British-funded programme that sees small quantities of cash - often just £10 a month - disbursed to some of Zambia’s poorest families.
The money was supposed to be transferred by post, but instead is believed to have been pocketed by senior officials in the Zambian postal service, who allegedly used the cash to buy expensive vehicles.
Dfid suspended funding to the cash transfer programme in June but chose not to immediately disclose the freeze.
Britain’s high commissioner to Lusaka, Fergus Cochrane-Dyet, confirmed the full suspension of Britain’s bilateral aid programme to Zambia after details of the freeze were disclosed by Africa Confidential, an influential fortnightly newsletter.
Mr Cochrane-Dyet said that Britain took a “zero-tolerance approach to fraud and corruption” and that aid would remain frozen until the findings of the audit Dfid had demanded were published.
Finland, Ireland and Sweden have also suspended aid after voicing concern about the allegations, most of which were contained in a confidential report by Zambia’s auditor general written last year.
The allegations and freeze on aid come at a difficult moment for the British government.
Theresa May visited the continent last month and pledged to increase UK investment in Africa in order to help drive economic growth, health security and British trade there.
The difficulties in Zambia will play into the hands of critics who argue Britain's aid budget, at 0.7 percent of GDP, is too generous and there are more stable regions of the world in which to build UK trade.
Britain has spent £26m over the past four years on a “Zambia accountability programme” that was meant to foster transparency within the government of Edgar Lungu, the president.
The largest share of British aid to Zambia — £12.2 million — is directed to the country’s health ministry. But many parts of the country are facing medicine shortages after large quantities of pharmaceutical products were stolen from government warehouses with suspected high-level involvement, Africa Confidential quoted donor sources as saying.
Of greatest concern is Zambia’s education ministry, where the auditor general’s office has reportedly asked to interview 400 employees suspected of involvement in channelling aid money into shell companies.
Zambia had been seen as one of Africa’s more stable countries but is now virtually bankrupt after years of splurging on debt, much of it from China.
Analysts say the country, 40 percent of whose population lives in extreme poverty, faces deeper financial turmoil that either Argentina or Turkey — despite the fact that Zambia’s international debt was almost entirely forgiven 12 years ago.
Despite the crisis, Mr Lungu is reported to be in negotiations with Russia to buy a presidential jet.
A spokesman for Mr Lungu denied the British high commissioner’s claim that all aid had been suspended, saying that only funds to the cash transfer programme had been frozen.
“All other forms of bilateral aid are ongoing,” Amos Chanda said.
A Dfid spokesperson said: "The UK maintains a zero-tolerance approach to fraud and corruption.
"While these investigations are ongoing, we have placed our direct support to the Government of Zambia on hold.
"There is [as yet] no evidence that confirms any loss of UK taxpayers' money."
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You are wlong.