Budget operations in K17 billion deficit in September
Government’s budgetary operations recorded a K17.7 billion deficit in September this year as expenditures far outweighed revenue, latest figures have shown.
Figures from the Reserve Bank of Malawi (RBM) released on Monday, indicate that government raised total revenues amounting to K110.1 billion in the ninth month of the calendar year which was dwarfed by the K127.7 billion total expenditure.
The revelation comes at a time Malawi continues to suffer from a chronic problem of spending beyond it means which has often thrown national budgets offbalance.
The September budget deficit was, however, better than the K41.1 billion shortfall recorded in August.
According to RBM, revenue jumped by K23.7 billion in September 2019, following a decline of K10.8 billion recorded in the previous month.
The reported increase in revenues was attributed to both domestic as well as foreign receipts.
“Total domestic revenues rose by K19.5 billion from a decrease of K13.2 billion to K81.4 billion as recorded in August 2019. The increase in domestic revenue collections in the month under review emanated from an increase of K15.5 billion and K4.0 billion in tax and nontax revenue collections, respectively.
“Foreign transfers on the other hand recorded an increase of K4.2 billion ($5.7 million) to K9.2 billion ($12.4 million) in the month,” RBM says in its September 2019 Economic Report released on Monday.
Total expenditures, on the other hand increased by K262.2 million from K127.5 billion recorded in August 2019.
The increase in total expenditures resulted from an increase of K357.6 million in recurrent expenditures which was slightly offset by a decrease of K95.4 billion. in development expenditures.
Speaking at end of the 2019/20 National Budget deliberations, Finance Minister Joseph Mwanamvekha, committed that the Treasury would implement the budget to the latter.
The 2019/2020 budget is pegged at K1.73 trillion in which total revenue and grants are projected at K1.575 trillion, representing 25.1 percent of GDP.
The budget projected domestic revenues at projected at K1.425 trillion, comprising K1.369 trillion as tax revenue and K55.8 billion non-tax revenue.
In its post budget analysis, the Malawi Confederation of Chambers of Commerce and Industry said fiscal discipline was key in the implementation of the national financial plan.
MCCCI argued that efficiency in the public finance management system could be achieved with the right personnel in the right places.
“There are numerous cases where individuals are given positions as a reward for personal loyalty or other non-professional connections. Most boards of parastatals are riddled with sycophants who do not add value to value creation objectives of their organisations.
“By no means is this encouraging. As a representative body of the majority of taxpayers we demand merit-based appointments in official positions as well as parastatal boards, “reads part of the analysis.