Party of National Unity (PNU) president Highvie Hamududu says without stating the amounts of money that will be saved from the austerity measures meant to address debt and fiscal challenges, the pronouncements will remain “flowery intentions” on paper.
In his statement issued to News Diggers!, Hamududu advised the Treasury to move a step further and indicate the exact amounts of money the country is expected to save, where the savings will be applied and explain the expenditure realignments.
Last month, Finance Minister, Margaret Mwanakatwe announced a cocktail of austerity measures, which included a moratorium on funding projects that are below the 80 per cent completion, in a bid to tackle the country’s growing public debt position and rein-in spending, among others.
“The austerity measures announced by the Minister of Finance to address debt and fiscal challenges need to be supported by figures if they are to be meaningful. Without stating the amounts that will be saved, holistically, from the announced austerity measures, such pronouncements will remain, by and large, mere flowery intentions on paper. The Treasury must go further to indicate exactly the amounts to be saved and where these savings should be applied, in other words, show us the expenditure realignments,” Hamududu stated.
“The objective of the austerity measures is not to slow down the wheels of the economy, but to apply budgetary resources to areas of greater economic impact and relieve citizens from biting economic conditions. More specifically, the government, through the Treasury, intends through these austerity measures to cut administrative costs, avoidable and wasteful expenditure and apply the savings in areas of highest priority such as addressing arrears to contractors, suppliers and pensioners; rolling back debt accumulation, meeting critical areas of social services such education and health; and supporting inclusive growth by facilitating citizen involvement in the economy.”
He observed that it would have been prudent for Mwanakatwe to provide a mini-budget statement to indicate the new expenditure profiles within the approved national budget.
“The Minister should have provided a mini-budget statement to indicate the new budget expenditure profiles within the approved national budget. With the guidance pronounced in the austerity measures, let the Treasury get specific submissions from all ministries, provinces and spending agencies (MPSAs), the exact savings to be made as result of adhering to these measures. This is where innovation in MPSAs becomes key. This exercise should be precursor to the 2019 national budget because the austerity measures announced need a number of years to address the debt and fiscal challenges. In fact, these measures should be the norm in government and should have been, anyway, because it is the right thing to do,” he guided.
And Hamududu, the former UPND Bweengwa member of parliament, warned that without bold and tough economic reforms, the country would get into more economic depression problems in the near future.
“Finally, beyond these announced austerity measures, which are basically routine house-keeping fiscal disciplinary measures, the government needs to pronounce bolder and tougher economic transformation measures to deal with the huge challenges the country is facing because the austerity measures announced by the Minister of Finance are not enough to correct the current fiscal imbalance. Without government taking bold and tough governance and economic reforms, I see the country getting into serious trouble in the near future, and signs are already showing of economic depression and hopelessness in the general citizenry,” warned Hamududu.