FINANCE and National Planning Minister Dr Situmbeko Musokotwane says government is currently unable to reintroduce meal allowances for students.
And Dr Musokotwane says all the plans set by the UPND government need to be implemented because the jobless youths who elected them will not have it any other way.
Meanwhile, Dr Musokotwane says government is only able marginally to raise the Pay As You Earn threshold to K4,500 because of Limited resources.
Speaking during the post-2022 Budget Symposium held at Mulungushi Conference centre, Monday, Dr Musokotwane said the UPND government was still committed to paying student meal allowances but there were no funds to support it currently.
“The meal allowances for the colleges, please take note that the President made a commitment that he is going to do that, but for now, those commitments are only possible within the means that are available. Just this week, he was talking about it, ‘I made this commitment, we need to honour our commitments’, but for now, it is not possible because the money has gone to your young brothers, your nephews, your young sisters. If we leave them behind and we focus the money on yourselves, then obviously we are creating a problem,” he said.
“So the issue is still very active in the minds of the President and all of us. As soon as we are able to do something in one way or the other, maybe through bursaries, maybe through loans that are more affordable than we have today, we will make the announcement. Please bear with us, we have not forgotten about it.”
And Dr Musokotwane said government had no option but to succeed.
“Colleagues, there is no choice. This thing must succeed, if it succeeded in Mauritius, if it succeeded in Malaysia, if it succeeded in Taiwan, Vietnam, these arrangements succeeded, why should we fail? There is no chance for failure now, failure is not an option. If we fail, just know that this country is going to go up in flames, because these young people that we are busy producing and not giving jobs, they will not leave us in peace. So there is no option for failure,” Dr Musokotwane said.
He said Mopani and KCM were still in a mess.
“KCM and Mopani, these are in a mess. If you were made to believe that by merely saying this now belongs to us Zambians, if you believed that the solution had been found, you are mistaken. Already you can hear what is happening in KCM. More importantly, these mines need huge amounts of capital to be able to bring to the level which can contribute to that output mining that we are talking about. So what appears to be glittering on the surface is not real. Serious work is required there. I can confirm that some discussions had started and at some point when we are ready to make announcements on the way forward, those will be mentioned. Please don’t believe that there was a solution that was arrived that. It was a big mess,” Dr Musokotwane said.
Meanwhile, Dr Musokotwane said government was only able to raise the Pay As You Earn threshold to K4,500 because of tight resources.
“I want to address one tax measure, there has been a concern that the tax relief given to employees is not enough. What we have done, the taxable threshold has moved from K4,000 to K4,500. So for the employees, we have returned K500 to every employee. There is a concern that this is not enough given the kind of economic situation that we have been facing. Right now this budget is very tight because nearly half of the money goes for debt servicing. You know that the budget is tight but we needed to take some money back to society. What is the most efficient route? We thought the most efficient route is to make education free. Because if we had adjusted the tax band, the beneficiaries would have been just those in formal employment, ones that are paying taxes. So we said that by making education free we are actually targeting a bigger group of people,” said Dr Musokotwane.
And Bank of Zambia Governor Dr Denny Kalyaya said obtaining an International Monetary Fund loan would enable government to get budget support from other institutions.
“I just wanted to add on the aspect of the IMF, I think a number of times, what I have seen is that the focus turns to be on just the debt restructuring. But there is more that lies behind that. I am sure those of you who are close to how government has been operating, we have had challenges of getting what is called budget support. Budget support put simply is money which goes into government coffers’ basket where the Ministry as part of its budgeting does that. Some of you also remember not too long ago, we used to have what we called the CGs (consultative group meetings) where the government along with the cooperating partners engage into some discussion in terms of mobilizing, financing for the budget. So what I am trying to say here is that apart from creating the environment for debt restructuring there is also budget support mobilization,” said Dr Kalyaya.
“An agreement with the IMF provides that mechanism for budget support to come through. Institutions like the world bank will not provide budget support if you do not have an IMF programme, equally the African Development Bank, they can speak for themselves too, they will not provide budget support, if you do not have an agreement with the IMF. And this has been the reality in our country for some time. What I am saying in short is that by having an IMF programme, you open the door to get budget support from these other institutions. If I may extend that a bit, we noted that some bilaterals had ceased giving support because they thought that the risks were too high. So with a fund programme, that opportunity is there.”