Treasury defends budget allocations | The Nation Online

Treasury defends budget allocations | The Nation Online

Post was last updated: March 17, 2023

Secretary to the Treasury McDonald Mafuta Mwale has defended allocations in the proposed K3.87 trillion 2023/24 National Budget, arguing  they are based on available resources.

Speaking on Wednesday in Lilongwe during a post-budget consultation, he said in view of limited resources, there is need to find other ways of supplementing revenue collection.

His comments came after experts dissected the budget and found that the money allocated in some budget lines is not adequate to implement the planned projects in the forthcoming fiscal year.

Said Mafuta-Mwale: “Your comments may be genuine, but where do we get the resources from?

“It’s a challenge because we allocate according to what we collect. If anything, we need to find other means of collecting revenue.”

Taking his turn, a member of the Budget and Finance Committee of Parliament Ralph Jooma said the K2 billion allocated to unforeseen expenditure is on the lower side to cover the damage which has been caused by Tropical Cyclone Freddy.

Mafuta Mwale: We allocate according
to what we collect

He said: “It is like government just allocated the funds for the sake of completing the budget.

“Otherwise, looking at the damage which the country has suffered from the current storm, we needed a minimum of K5 billion.”

Jooma, who is Mangochi Monkey Bay legislator, said government needs to revise allocations to some ministries such as that Agriculture, Health and Education before the budget passes to match people’s needs.

Malawi Health Equity Network executive director George Jobe said given the current cholera outbreak, the health sector needed a huge allocation to cater for drugs and the recruitment of more health personnel.

“The allocation is minimal when one considers the health needs. With the current cholera outbreak, we need more resources to fight this pandemic,” he said.

On his part, quality education activists Benedicto Kondowe said the allocation to the education sector in the next budget does not match the needs in the sector.

He feared this could affect the quality of education in the country.

Said Kondowe: “The education sector needs seriousness if we are dreaming of achieving good quality education.

“The allocation to education may look huge to the eyes, but it does not match the needs.”

In his contribution, education non-governmental organisation Edukans country director Limbani Nsapato suggested the introduction of an education levy to boost education financing.

NGO-Coalition on Child Rights chairperson Desmond Mhango said an analysis of the budget by the coalition members revealed that children’s programmes are the worst- funded in the budget.

He said: “Children are nowhere in the budget, yet we say children are an investment.

“Why do we seem to neglect the children so much? Something should be done about this budget.”

In the proposed budget, the Ministry of Education has been allocated K603.36 billion, the Ministry of Agriculture has been given K455.10 billion while the Ministry of Health has been allocated K330.18 billion.

The 2023/24 fiscal plan has been formulated on the assumption of real gross domestic product (GDP) growth of 2.7 percent in 2023 and 3.2 percent in 2024, an average inflation rate of 17.9 percent, a policy rate of 18 percent and tax refunds of three percent of the total tax collection.

The budget’s total revenue and grants are estimated at K2.55 trillion, representing 16.8 percent of GDP, with domestic revenue estimated at K2.24 trillion, representing 14.7 percent of GDP.

Out of the domestic revenue, tax revenue is estimated at K2.13 trillion while other revenue is estimated at K114.34 billion.

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