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The distribution of property when a spouse, especially the bread winner, dies continues to be a thorny issue in Malawi.
Perhaps the worst area is the administration of institutional money, in particular death benefits for those formally employed.
The Administrator General’s office, whose duty is to administer deceased estates, is renowned for delays that make beneficiaries, mostly women and children, suffer unnecessarily.
An audit report released in 2001 noted lack of control over withdrawals of deceased estate funds, improper keeping of deceased estate files and irregular distribution of deceased estate funds.
In May last year, Administrator General Barnet Makwinja admitted during a press briefing his office has been unable to distribute deceased estates in good time. He attributed the problem to staff shortage and lack of a computerised system.
Makwinja said in an interview last Wednesday the situation has improved in that more members of staff have since been employed in the accounts department and computers have been sourced.
“We have not fully started using them for keeping records but on the whole distribution of deceased estates is now faster than before,” he said.
The story is not any better at district commissioners’ offices, which administer deceased estates on behalf of the Administrator General’s office.
Concerned about the situation and the hardship the beneficiaries are subjected to, a Special Law Commission on Gender Law Reform has come up with some recommendations that could speed up the process.
This special Law Commission on Gender was put in place in September 2001 to review the laws of Malawi and recommend changes which will promote gender equality in Malawi.
It is currently reviewing the Wills and Inheritance Act and is recommending, among other things, that employers be legally mandated to administer death benefits and pay them directly to the beneficiaries.
According to Law Commission’s law reform officer William Msiska, the law does not recognise anyone apart from the Administrator General, trust corporations and anyone who applies as an estate administrator.
But the special commission’s investigations revealed that some employers are already administering death benefits.
“They are doing so illegally unless they apply to be administrators,” explained Msiska.
Dyton Maliro, a lecturer in agriculture economics and gender at Bunda College told the commission he is aware some employers administer death benefits and the process is fast.
“Some are able to call the beneficiaries or at least members of the deceased’s family within two weeks after death and tell them how much they should expect and they are also able to pay them their dues two or three months after the death,” he said.
The University of Malawi is one of the employers running a scheme which pays death benefits directly to beneficiaries.
Finance officer for Chancellor College Harry Chiwaya said the system works very well for the college’s employees, who are asked to fill in and always update forms where they indicate beneficiaries of their death benefits.
“We try as much as possible to avoid going through the Administrator General because of delays.
“We pay directly to the beneficiaries indicated on the form and on average, we take between three and four months to pay them,” said Chiwaya.
He, however, said of late the college has been unable to pay on time because it is in arrears by about four months in payment of premiums to insurance institutions. He attributed this to funding problems to the college.
Chiwaya also said another major problem the college faces in the administration of death benefits is the employees’ inability to update the beneficiary nomination forms.
“We also get problems from step children, other dependants and other women claiming to be wives and, therefore, demanding their share,” he said.
He described the recommendation by the special commission as a “welcome development”.
But he cautioned that there should be rules governing the process otherwise the benefits could be abused.
“We as an institution have not had such cases but all the same, the benefits could be abused if there are no rules guarding against abuse,” he said.
National Bank of Malawi’s head of human resources Daphter Namandwa described the recommendation as a “good development”.
He gave an example of the bank’s Financial Management Services which acts as a trustee and manages pension schemes for other organisations.
“We pay the beneficiaries very promptly. We are concerned about minimising suffering on the part of the beneficiaries, so I would support any efforts aimed at speeding up the distribution process,” he said.
Council for non governmental organisation’s executive director Ted Nandolo also supported the idea of mandating employers to distribute death benefits.
“It’s a good idea. I support it only that there has to be a right legal framework otherwise some people could easily be defrauded,” he said.
He, however, noted that if proper safe nets are put in place, companies can easily recover money from an employee who defrauds beneficiaries.
Commenting on the commission’s recommendation, the Administrator General Wednesday said he has “no problem with employers doing it on their own”, but was quick to say they should first apply for letters of administration so that they can have the mandate to distribute.
Makwinja also said the problem is that the employers may not declare duty for the benefits and government would, therefore, lose revenue.
“Of course the duty is on the hire side and if government were to reduce it the problem may not arise,” he said.
Currently, duty rates are five percent for amounts between K30,000 and K40,000, six per cent for K40,000—K80,000, seven per cent for K80,000—K140,000.
Ngeyi Kanyongolo a lecturer in law at Chancellor College, who is also a commissioner feels it is expensive to get letters of administration.
“There is advertising that is involved, the process is also cumbersome and technical. It requires a lawyer,” she observed.
She, however, said considering that most Malawians are poor and that those working in the formal sector’s major economic security is death benefits, a system ought to be put in place for beneficiaries to get their money in good time.
“For the few already doing it, it’s a better option than what going on at Administrator General or DC’s offices, but there is need to regulate the system to enhance protection for beneficiaries.
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