Economists have expressed dismay over fiscal slippages in the government which they say continue to exert pressure on public purse and the economy.
This came out at the three-day Economics Association of Malawi (Ecama) annual conference which started on Wednesday in Mangochi.
The concern comes as the government has been faulted for its instiable appetite expenditure, leading to a surge in borrowing.
For instance, the central government’s total revenues and expenditures were recorded at K299.8 billion and K449.4 billion, respectively in September 2024, culminating in a deficit of K149.6 billion. In the previous month, the Treasury recorded a deficit of K189.2 billion.
However, the outturn was a deterioration compared to a deficit of K35.5 billion recorded in September 2023.
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At the Ecama indaba, the general view was that while other entities like the monetary authorities worked tirelessly to contain inflationary pressure using monetary instruments, fiscal slippages continued to counter the efforts.
For instance, while moderating a panel discussion on a presentation titled ‘Framework for Internal and External Stabilisation’ on the first day of the conference, academician and former Secretary to Treasury (ST) Ellias Ngalande said effective use of the Public Finance Management act, would help avoid leakages.
“Everything is in there that would restrain us from borrowing beyond our means,” Ngalande said.
One of the delegates argued that it is high time citizens’ rise and sue the Secretary to Treasury for not following the PFMA.
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“If we do that, the ST, the Minister of Finance and the government will wake up,” said the delegate.
In an interview, Ecama President Bertha Bangara- Chikadza said policy inconsistency continues to cost Malawi a fortune.
She said sometimes people tend to act just because something has happened, but if Malawi was consistent with policies, from 10 years back, for example, by now the country would have improved.
In a separate interview, Secretary to Treasury Betchani Tchereni said the Treasury follows the PFMA in implementing budgets.
“People must understand that when parliament passes the national budget it becomes a law and, in that law, provisions to borrow to finance the deficit are made and therefore when the Treasury borrows it is in essence within the law.
“Contravening the PFMA is punishable and if the Treasury is found contravening that law it must be punished,” Tchereni said.
Meanwhile, Minister of Finance Simplex Chithyola Banda, while delivering the conference’ opening speech urged the expert to put across practical solutions to Malawi’s situation.
“Economies that face similar vulnerabilities like Malawi have found ways to mitigate the impact of external shocks through strategic interventions. That is why I am challenging you here to have home-grown solutions, because we need to get means and ways,” Chithyola said.
