Zambian President Edgar Lungu on Wednesday sacked Community Development minister Emerine Kabanshi, whose portfolio manages a social cash transfer scheme embroiled in fraud allegations.
The president also sacked the Zampost postmaster peneral, whose company was tasked to make payments to household beneficiaries.
The sackings came days after Britain announced that it had suspended all bilateral funding to Zambia, in light of potential concerns, until audit results are known.
British High Commissioner Fergus Cochrane-Dyet posted on Twitter that: "#UKAid takes a zero-tolerance approach to fraud and corruption."
The suspension of the funding was done by the Department for International Development (DfID), which supports a social cash transfer scheme that was allegedly being abused by Zambian officials.
Government spokesperson Dora Siliya, however, downplayed the allegations saying "relations with all donors was OK as far as government was concerned [sic]".
Local media quoted an audit which claims Zampost officers paid themselves $4 million as advances for vehicles and included bogus beneficiaries in the list.
Britain, which colonised Zambia, historically is the southern Africa state's biggest donor.
The graft concerns were published by London-based Journal Africa Confidential.
It said Finland, Sweden, Ireland and Unicef too had frozen funding and that DfID had privately asked for the $4 million to be returned.
President Lungu recently asked for an increase of household beneficiaries from 257,000 to 780,000 because the programme was deemed a success.
Zambia is currently grappling with the ever-increasing debt, mostly from the Chinese.
The current regime is largely viewed as having a soft approach to graft, hence doubts abound if any officials will be successfully prosecuted.
It was not clear if Ms Kabanshi, who has already been replaced, would face prosecution.
Senior government officials are rarely jailed for criminal offences.