Parliament approves K511.3 billion provisional budget


By Rebecca Chimjeka & Faith Kadzanja:

GWENGWE — Turn the screws on all corrupt barons

Parliament has given the Executive the greenlight to withdraw K511.3 billion from the Consolidated Fund for the purpose of meeting expenditure from July 1 2019 to October 31 2019 or until the Appropriation Act 2019 comes into force.

When presenting the four-month K511,269,522,794 budget to the august House yesterday, Finance, Economic Planning and Development Minister, Joseph Mwanamvekha, said the provisional budget puts into consideration the fact that Cabinet was constituted on June 20 2019 and there was limited time to bring the full budget before July 1 2019.


“As per tradition, the provisional budget does not come in form of a budget statement but as a motion. This is because both the budget statement and the detailed budget will be presented when Parliament reconvenes to discuss the full national budget. As I have indicated, the provisional budget figures will also form part of the 2019/20 national budget,” he said.

Mwanamvekha said some of the assumptions underlying the provisional budget are that inflation is expected to average 8.0 percent during the period under review, exchange rate is expected to average K750 to one United States dollar and the government is expected to reduce domestic borrowing from 4.1 percent of Gross Domestic Product (GDP) to 0.3 percent.

Mwanamvekha also said ongoing projects would be provided for in the provisional budget, adding that provisions for new projects would be made in the main budget. He also said the provisional budget has total revenue and grants amounting to K461.2 billion, of which K410.5 billion is domestic revenues and K50.7 billion are grants.


“Madam Speaker, wages and salaries are projected at K135 billion, representing 34.3 percent of the 2018/19 approved personal emoluments figure of K393.6 billion. The projection has been based on government ministries, departments and agencies actual expenditure on wages and salaries. In addition, the estimate has taken into consideration the recent promotion of teachers and security officers,” he said.

He said development expenditure has a total provision of K116.5 billion, of which K98.7 billion is foreign financed while K17.9 billion is domestically financed.

The minister disclosed that the World Bank would provide $40 million in grants to support the budget. He also said the Chinese government would provide $30 million.

The provisional budget has a net domestic borrowing of K16.5 billion. Mwanamvekha said this is much lower than the K84.3 billion for the same period in the 2018/19 budget.

In response, Malawi Congress Party (MCP) spokesperson on Finance, Sosten Gwengwe, urged the government to deal with cases of corruption and reduce borrowing.

“Madam Speaker, the MCP expects the new minister to turn the screws on all corrupt barons in government and outside. Madam Speaker, the MCP expects the new Finance Minister to crack down on monopolistic companies who bribe government officials to get their way into government contracts,” Gwengwe said.

He added: “Madam Speaker, if the MCP would tip the new minister on one thing, it would be to update this House on ways of slowing down on the domestic and foreign debts.”

He said it was not inspiring to see that the first bill to be tabled in Parliament was a money bill, blaming both Parliament and the Executive for passing a lot of loans which continue to haunt Malawians.

United Democrat Front spokesperson on finance, Rodrick Khumbanyiwa, said it was the party’s wish that the budget approved would be used for its intended purpose.

However, Alliance for Democracy lone Member of Parliament, Yeremiah Chihana, wondered how government would reduce domestic borrowing from 4.1 percent of GDP to 0.3 percent.

Health rights activist, Maziko Matemba, said he expected the main budget to include more development projects in the health sector.

“As civil society organisations, we are aware that this is just a provisional budget on essential services/areas but we would still want to see that there is no disruption of other equally important public services such as the provision of drugs in hospitals, learning materials and maintenance of critical infrastructures.

“We hope the main budget after October will be aligned with the development agenda of the country as outlined in Malawi Growth and Development Strategy 2,” he said.

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