Debt repayment gobbles K1.5bn in October

21st November 2018

Business

Finance minister Margaret Mwanakatwe addresses journalists during a signing ceremony of a grant agreement between the government of Zambia and KFW of the Federal Republic of Germany at her office in Lusaka on August 21, 2018 – Picture by Tenson Mkhala

Business

Finance minister Margaret Mwanakatwe addresses journalists during a signing ceremony of a grant agreement between the government of Zambia and KFW of the Federal Republic of Germany at her office in Lusaka on August 21, 2018 – Picture by Tenson Mkhala

Debt servicing payments gobbled K1.5 billion in October, 2018, representing around 25 per cent of government’s total expenditure during that month from the 2018 national budget.

In a 2018 budget brief issued from the Ministry of Finance, government paid K1.5 billion last month in debt servicing commitments out of a total of K6.1 billion that was released by the Ministry of Finance to fund various government operations.

Government’s debt servicing commitments ranked second in terms of the total amount spent, behind personal emoluments that swallowed K2.4 billion or nearly 40 per cent of total amount dispensed.

“During the month of October, 2018, the government released a total of K6.1 billion to finance various operations of the government. Out of the amount released, a total of K2.4 billion was released on personal emoluments; K1.5 billion on debt service; and K1.1 billion on grants and other payments, while the remainder of K1.1 billion was spent on other key programmes,” read the statement.

“Personal emoluments at K2.4 billion went towards timely payment of salaries to various civil servants including teachers, medical personnel and police officers. Grants to universities amounted to K80.1 million; student loans and scholarships amounted to K99.9 million; grants to schools amounted to K60.8 million; and, to enable implementation of planned activities, the Skills Development Fund was funded K20 million. K344.9 million was released to grant aided institutions for their operations, while various Ministries received K92 million. And to restock drugs and medical supplies in hospitals, the Treasury released K150 million to the Ministry of Health.”

In the agricultural sector, over K170 million was released last month to finance the Farmer Input Support Programme (FISP), while the Food Reserve Agency (FRA) received K23 million.

“K170.3 million (summing to K1.142 billion in 2018) was released towards the FISP to cater for liquidation of outstanding arrears and implementation of the e-voucher programme for the forthcoming 2018/2019 farming season. The Food Security Pack, which also complements the FISP, has received a total of K50 million so far and the Food Reserve Agency got K23 million (totalling to K211.6 million released in 2018) for procurement of maize and other grains to meet the strategic reserve requirements,” it stated.

And the Zambia Revenue Authority (ZRA) also received a grant amounting K61.7 million to enable the Authority implement planned activities aimed at enhancing tax collection.