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Budget day

Sosten Gwengwe presents new fiscal plan amid mixed performance of the current one

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kondwani nankhumwa

New Minister of Finance Sosten Gwengwe is this afternoon presenting the 2022-23 National Budget.

He will be doing so with a shadow of the ending budget hanging on him as performance has been mixed.

There was excitement on May 28 2021 when former Finance minister Felix Mlusu made a number of pronouncements when he presented the K1.99 trillion 2021 – 22 budget.

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Among other things, Mlusu promised Malawians free electricity and water connections within the financial year, which ends on March 31.

However, government has not implemented this yet, promising to fulfil this promise in the coming financial year instead.

In the budget, Mlusu noted that the conditions of Malawi’s city roads, drainage system and street lighting were poor.

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He, therefore, allocated K8.9 billion to the city of Blantyre, K7.8 billion to the city of Lilongwe, K4.1 billion to the city of Mzuzu and another K4.1 billion to the city of Zomba for maintenance and rehabilitation of these facilities.

But our assessment shows that roads in these cities remain in pathetic condition and there are no functioning street lights in most townships in the cities.

To promote quality childhood development, government promised to start giving honoraria of K15,000 per month to certified caregivers. This was never implemented.

The 2021-22 financial plan also promised to continue with the empowerment and security of persons with disability.

It allocated K300 million for the implementation of the Action Plan for the Protection of People with Albinism.

But as Young Muhamba, president for Association of People with Albinism (Apam), says, government has not made available the funds during the financial year coming to an end.

The budget also promised commencement of a number of road projects.

None of this has happened.

On a positive note though, the budget paid off arrears which the previous government owed the private sector, some dating back to 2015.

The budget also managed to deliver on the promise of introducing the duty-free week which took place in late January. During the week, imports not exceeding $3,000 entered Malawi duty free.

The 2021-22 budget also provided a relief to low-income earners by introducing a 25 percent bracket for incomes between K100,000 and K1 million per month to promote distribution of wealth in the country and increase disposable income for all low-income earners.

Reviewing the ending budget, Director for economic think-tank, Centre for Research and Consultancy, Milward Tobias, said the budget achieved some goals and failed to deliver on other promises.

He said one of the key achievements of the budget is the Affordable Inputs Programme.

“The long-term development bond also started as a sustainable means of domestic borrowing to finance earmarked development projects at comparably low interest rate,” he said, adding, “The National Economic Empowerment Fund disbursed loans amid public dissatisfaction with delays in getting loans.”

Speaking in an interview on Wednesday, Leader of the Opposition in parliament Kondwani Nankhumwa said it would be difficult to comment on a budget that had not been scrutinised after mid-year.

“As we speak, we don’t know how much the government has disbursed to all MDAs [ministries, departments and agencies] and costing of all projects and how much government has borrowed to finance the budget so far.

“We expect the government to bring an abridged version of mid-year review to enable us to understand what has been collected as revenue through the MRA, our total expenditure and loans position,” Nankhumwa said.

Asked as to how much they would rate the budget performance, Treasury spokesperson Williams Banda said Gwengwe would paint a picture of how the budget performed when he presents the budget statement today.

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