Debt repayments mustn’t impede social sector spending in 2020 budget – ZTP

Zambia Tax Platform Coordinator Ibrahim Kamara says implementation of the 2020 national budget must address how the country’s rising public debt will be effectively dismantled, while ensuring sufficient resources will be made available to address critical social sector areas.

In a statement, Kamara called on government to allocate more resources to sectors such as social protection, where he he observed a reduction in spending, which had consequently affected the quality of life of poor Zambians.

While funding allocated towards social protection had gone up to over K2.5 billion next year from K2.1 billion this year, education, environmental protection and the Farmer Input Support Programme (FISP) had registered significant decreases in next year’s budget.

“As ZTP, we expect that government to increase the budget allocation towards social protection; marginalized groups; the disabled; the elderly and children must be targeted for social cash transfers and the funds must be disbursed to the planned beneficiaries. Furthermore, education and health are important areas towards human development. We expect government to address key issues, such as maternal health. Deliberate efforts to address the rights of disabled school-going children through a budgetary allocation must be made. We are also deeply concerned with the current debt situation in the country, which has impacted on government spending towards other sectors. ZTP expects government to produce a clear plan on how it will mitigate the impact of debt accumulation on the country’s economic integrity. This must include parliamentary oversight on debt contraction and commitment to austerity measures,” Kamara stated.

And he also called on government to ensure it did not spend more than it had.

“Debt servicing, especially on foreign-owed debt, has greatly contributed to the reduction of the country’s foreign exchange reserves, which, currently, can only support 1.6 months of import cover at about US $1.4 billion (BoZ, 2019). The country will need liquidity and should seek to engage the IMF for support. Furthermore, fiscal discipline must be observed. Government must not spend more than it has such that the country lives beyond its means. Austerity measures are inevitable, but discipline must start from leadership before it can be imposed to the people. The reality of climate change is now clear. There must be sustainable solutions to climate change and these must be implemented effectively rather than proclamations in media statements – according to research, 1.7 million people in Zambia are on the verge of hunger and this number is expected to rise to 2.3 million from October, 2019, to March, 2020 (DG ECHO, 2019). Crop yields have reduced and dependence on rainfall is no longer sustainable. As ZTP, we expect measures that are aimed at addressing this in the 2020 national budget,” stated Kamara.

“We expect government to dedicate more resources towards irrigation equipment in light of climate change and also make flexible the importation of such facilities. We also expect that the farmers input support programme will be rolled out 100 per cent nationwide and that this will be done through the E-voucher. Government’s administrative budget must be reduced without compromising on social spending. The country must also begin to move towards budgetary targets set in protocols that it is party to such as 10 per cent of public expenditure being allocated towards agriculture as set the Malabo Declaration – other protocols include SADC and COMESA protocols. ZTP believes that such are measures that the government must embark on to fix the current economic situation, in a bid to enhance efforts towards domestic resource revenue, it is our further expectation that government considers raising domestic resources from taxing harmful products such as tobacco. In this light, our hope is that government will adopt the recommendations that were given by the Zambia Tax Platform for the 2020 national budget.”

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