Mutharika narrowly won elections earlier this year

Bingu wa Mutharika said he wanted to move from his Blantyre residence to the capital, Lilongwe, as part of attempts to streamline government operations.

But the opposition said the decision ran against his promises to cut government expenditure.

Parliament has 300 rooms and its own school and supermarket.

New State House was originally built as a presidential palace at a cost of $100m by a former president, Hastings Kamuzu Banda, but he only stayed in the house for 90 days.

Parliament moved into the site in 1995.

"The president needs enough room," said Ken Zikhale Ng'oma the president's chief of staff.

Costly

But Catherine Chisala, spokesperson for the Peoples Progressive Movement, said they were unimpressed.

"It will be very expensive to renovate the Kamuzi Institute for Sports into a habitable place and the New State House into a presidential palace," she said.

The BBC's Raphael Tenthani in Malawi says that President Mutharika's predecessor, Bakili Muluzi, who was criticised for excessive over-expenditure, refused to occupy New State House, calling it an "obscene extravagance".

The site of the proposed parliament was bombed by the army when it was occupied by paramilitaries loyal to President Banda when he lost power in 1993.

The Malawi Young Pioneers, as they were called, were suspected of storing their arms in the building.

The sports complex remains in disrepair.