Debate on the role of Secretary to the President and Cabinet (SPC) as chairperson of State-owned companies has taken a new twist with some lawyers proposing a judicial review on the matter.

The lawyers, Justin Dzonzi and Kamudoni Nyasulu, said in separate interviews yesterday that the judicial review would determine whether it is constitutional for the SPC to chair boards of National Oil Company of Malawi (Nocma), Electricity Generation Company (Egenco) and Power Market Limited (PML)

The sentiments come against a background of the provision in Section 194 of the Constitution which states: “Where a law confers power to appoint a board, commission, council, committee or similar body and to appoint, elect or designate the chairperson thereof, no person shall be appointed, elected or designated as chairperson of more than one such board, commission, council, committee or similar body.”

But Attorney General (AG) Thabo Chakaka Nyirenda yesterday justified the arrangement, arguing that the law refers to statutory corporations while the SPC chairs companies.

Nyasulu: There is need for judicial review

He said: “My view is that the law refers to statutory corporations and not companies. The Memorandum and Articles of Association [Memas] or constitution of a company is one that will guide how to appoint a board and who should be in the board. Let’s not read something that is not there.”

But Nyasulu, who previously served as Director of Public Prosecutions and as prosecutor at United Nations tribunals, said there is need for a judicial review of the appointments of SPC as board chairperson for Nocma, PML and Egenco. He said the three entities are government agencies and the power to appoint their boards is given to government by virtue of shareholding and the Public Finance Management Act.

He said: “The President appoints boards under the Constitution. He appoints the SPC under the Constitution and Public Service Act. Section194 says power of appointing a board or designating a chair as conferred by law [Public Service Act or the Constitution in this case] cannot be used to appoint one person to chair more than one board.”

Dzonzi, who is also executive director of Justice Link, agreed with Nyasulu and observed that talking about the “unconstitutionality” of the status quo is not enough and that the best remedy to ensure that the rule of law is applied across the broad is to challenge it in the courts.

He said when parastatals are chaired by civil servants who are also policyholders, there is a serious conflict of interest in the running and management of the enterprise.

Said Dzonzi: “If the decision was purely one of business, that’s a decision that has to be done as such, but we all know that once government is involved everything changes.

“The fact that the SPC is doubling in positions does not directly affect only one individual in the country, to an extent that this is a national issue then any person can go to court and challenge it.”

In an earlier interview with The Nation edition of December 20 2022, Comptroller of Statutory Corporations Peter Sambani argued that the SPC’s involvement in several institutions cannot affect their performance.

He said: “Performance basically is based on how the executive management of the institution is adhering to the set up rules or key performance indicators.

“By virtue of seniority among the initial directors of the company, you find that the SPC is the chair of those boards. So, as of now, you can’t change because it is in the Memas.”

However, there has been tension between firms chaired by the SPC and others in the same sector, especially where there is conflict.

In February last year, former Malawi Energy Regulatory Authority board chairperson Leonard Chikadya pointed out that the involvement of the SPC at the helm of Nocma made it difficult for the regulator to undertake its functions.

The Public Appointments Committee (PAC) of Parliament also proposed amendment of laws that designate the SPC to serve as board chairperson of statutory corporations.

Presenting a report in Parliament for the period July 2020 to November 2021, PAC chairperson Joyce Chitsulo observed that there are serious problems in institutions whose boards are chaired by the SPC.

Last year, the Office of the Ombudsman also received a complaint on the alleged conflict of interest arising from the SPC’s leadership at Nocma.

The post Fresh push for review of SPC role in boards appeared first on The Nation Online.