KANTANSHI Independent member of parliament Anthony Mumba says the current projected output for the mining sector will not be good enough to support the revenues that government needs to deal with its debt stock and the country’s economic growth.
And Mumba says the government is under extreme pressure to bring the economy back on track.
Meanwhile, Kasenengwa PF member of parliament Sensio Banda says the 2021 budget is testimony of government’s strong desire to revive the economy on a stable and sustainable growth trajectory.
Debating the Supply Motion in parliament, Tuesday, Mumba also urged the government to be consistent on issues concerning the mining sector.
“I also want to urge the government to be consistent in the mining sector which is the major provider of our finances in terms of exchange rate and revenues for the government. I think there is need for us at US $7, 000 per ton, to take advantage of what’s happening. Currently, we have seen that even the output being projected for mining is not going to be good enough to support the revenues that the government needs to deal with the issues of debt and issues of opportunities for Zambian people or indeed to encourage growth at a faster rate,” Mumba said.
He added that the defaulting of suppliers and contractors to pay back bank loans was not their fault because government paid them late.
“Again the minister did raise the issue of the default ration in the banks. I think that the government also needs to go further because it’s not the suppliers and contractors’ fault that they are defaulting their loans but it’s also the very fact that they are not paid on time. So, the credit reference bureau should also be considered for discussions,” Mumba said. “The minister also talked about the [K]5.7 billion that is going to be spent on FISP. We have seen the consistency of the Patriotic Front in terms of providing for farmers but what we haven’t seen is this investment going back into some sort of providing revenue line for future FISP programmes and as a result the government keeps on dipping into its treasury. So, I hope that the Ministry of Agriculture, all these bumper harvests that we have had can add up to something in terms of revenue stream being created separately.”
He said looking at the current economic situation, it was undoubtedly clear that the government was under a lot of pressure.
“We are like in a recession, this is something that happened to us in 2009 but this sort of a recession that we have now, where we are growing at negative four per cent, obviously provides a huge challenge to government in terms of creating jobs, in terms of companies being able to pay their fair share of taxes on time and as well as the agitations that come with opportunities being lost in the people. So, the government is undoubtedly under a lot of pressure. But some of the issues that were highlighted in the budget do provide some sense of platform for Zambians to continue to support the government that is in office, the Patriotic Front (PF), in as far as opportunities are concerned,” Mumba said.
He said it was regrettable that government had neglected to pay suppliers of goods and services and focused its attention on infrastructure development.
“Let me quickly talk about the dismantling of domestic debt. I think that the government has been consistent but not consistent enough. I think that the concentration has been more under infrastructure and leaving out those who supplied goods and services to the government. And the Ministry of Finance, through the spending agencies and ministries, are going to prioritize the people that have supplied the goods and services as much as we have seen the government concentrating on road contracts. And even when you talk about road contracts, we have seen again that there has been a dismal effect in as far as having money in the economy was concerned because you find that it’s the same people that are being paid. I hope that the government and spending agencies will improve on that,” Mumba said.
And Mumba said the government could talk to pensioners and persuade them to buy Treasury Bills to avoid paying the K1 billion allocated to them in the 2021 budget.
“Let me also speak about the liquidity issue around the Treasury Bills and Bonds, which mostly has been some form of major income for banks. If the government can also consider making it simpler for Zambians to buy these Treasury Bills, it will go a long way in helping the government’s liquidity position. For example, K1 billion has been allocated to pay pensioners. If pensioners are able to be spoken to, it will mean that the government does not need to pay that K1 billion,” said Mumba. “A pensioner will be able to buy a Treasury Bill, which will mature maybe after a year or two. Government can enter into an agreement with individual pensioners and individual members of parliament who would want to invest such money at a better rate.”
Meanwhile, Banda described the 2021 national budget as responsive, balanced, and practical.
“Mr Speaker, Indeed, the minister’s budget is a testimony to the government’s strong desire to revive the economy on a stable and sustainable growth trajectory. I cannot overemphasize that this budget is responsive, balanced, and practical. I am aware of other progressive thematic interventions proposed in the budget but due to time constraints, allow me to highlight some proposed interventions aimed at stimulating growth in some sectors. I note specifically the government’s plan to migrate the beneficiaries of the Farmer Input Support Programme to the cost effective e-voucher system. This will ease access to agricultural inputs, and trigger substantial yields. Further, Zambia must be elated by the proposal to zero rate value added tax on the importation of tractors, and suspension of import duty on refrigerated trucks. Both proposals have great potential to increase the country’s food security by enhancing productivity,” said Banda.
“Mr Speaker, no sector can thrive without electricity. The determination to complete the construction of hydro-electric power plants such as Kafue Gorge Lower power station is profound and commendable. The completion of this project will significantly counter the current power deficits and enhance production across all sectors. Sir, allow me to recognise the government’s deliberate intervention to raise the threshold for PAYE to K4, 000 from K3, 300. This is a demonstration of PF government’s pro-poor policy of putting more money in people’s pockets and thereby improving the living condition of ordinary Zambians.”