Government has, through the Ministry of Finance, released the 2018-2020 Medium Term Expenditure Framework (MTEF) with a K65.4 billion national budget projection.
And the Ministry of Finance has called on government stakeholders to scrutinise the 2018-2020 “Green Paper” and make constructive recommendations.
“I am pleased to present the 2018-2020 “Green Paper” which is aimed at linking Government’s medium term development goals, as tabulated in the Seventh National Development Plan. In over seven years, this is the first time that a green paper is being availed to the public for scrutiny, commentary, and refinement,” the Ministry stated in a statement released today.
“Over the 2018–2020 medium term, Government projects to spend a total of K210.0 billion, excluding amortisation, out of which, K65.4 billion will be spent in 2018, K69.4 billion in 2019 and K75.1 billion in 2020. As a share of GDP, this will amount to an average of 22.2 percent per annum. Out of the projected total expenditure of K210.0 billion, 80.8 percent will be financed from domestic revenues and the balance through domestic and external borrowing. Table 4 below shows the budget by economic classification as a share of GDP.”
The Ministry said government intends to scale down borrowing.
“In the context of the objective of fiscal consolidation, Government will over the medium term progressively scale down its borrowing levels. With domestic resource mobilisation not being able to fully compensate for lower financing, Government’s overall expenditure policy for the period 2018–2020 will be characterised by reforms aimed at improving value for money as well as reduced spending in non-priority areas. Therefore, expenditure will be focused on areas that will contribute to economic diversification and job creation. This will facilitate a reduction in poverty and vulnerability levels, developmental inequalities and enhance human development. Expenditure policy will also focus on developing a governance environment for a diversified and inclusive economy, in line with the 7NDP,” read the statement.
“Further, Government will continue to prioritise the dismantling of arrears in the allocation of resources in order to inject working capital back into the private sector and move public finances to a more sustainable trajectory. The 2018–2020 Green Paper focuses on sustaining economic growth and development through the continued implementation of the ESGP. The programme is aimed at restoring fiscal fitness and overall macroeconomic stability as a basis for setting a platform for higher inclusive growth, employment and wealth creation in the medium to long- term. In this regard, Government over the medium term plans to prioritise agriculture, mining, manufacturing and tourism as the strategic sectors for the creation of decent employment opportunities and inclusive development.”
The ministry called for recommendations and contributions from the public.
“All stakeholders are therefore implored to scrutinize the 2018 – 2020 “Green Paper” and make constructive recommendations that will enable the finalization of the nation’s objectives over the next medium term period. In line with the theme of the Seventh National Development Plan (7NDP) which focuses on an integrated multi- sectoral development approach of “accelerating development efforts towards Vision 2030 without leaving anyone behind”, the 2018-2020 Medium Term Expenditure Framework reflects Government’s commitment to ensure that the benefits of economic growth are shared equitably by all citizens. Therefore, Government will work on creating a diversified and resilient economy for sustained growth and socio-economic transformation driven, by among others, the agriculture, tourism, manufacturing and mining sectors,” read the statement in part.
“The MTEF will focus on restoring fiscal fitness for sustained inclusive growth and development. This will be done by realigning spending and enhancing domestic resource mobilisation. Administrative measures are being put in place to strengthen efforts of improving domestic revenue mobilisation so as to meet the medium term revenue targets. This will be through the full implementation of various measures already commenced upon, such as installation of fiscal registers in the retail and wholesale sector and the forensic audit of VAT refund claims to reduce cheating and revenue leakages. Tax payer education campaigns will also be enhanced to encourage compliance, while the introduction and roll out of electronic payments will be followed through in order to limit cash transactions and enhance audit trails. To complement the various efforts on mobilising revenues, the Government will also continue to engage with Cooperating Partners to increase the level of assistance from 2018 and beyond.”Budget 2018 - 2020