Source: Patrick Chinamasa to deliver moot budget | The Financial Gazette November 10, 2016
“MIDLANDS, as a province, was allocated US$460 000 in the National Budget, but to date only US$3 000 has been disbursed.
“We continue to lobby the rest of the government and Treasury to look at this priority area of health.
“You can’t allocate US$460 000 and disburse just US$3 000.”
This was said by a thoroughly frustrated Health and Child Care Minister David Parirenyatwa, in April this year, four months into the 2016 budget.
As he continued his regular tours around the country’s health institutions, by September, he had discovered that in the 2015 budget, Filabusi District Hospital had been allocated just US$133 000, of which it only received a paltry US$36 000.
That US$133 000 was further slashed to just US$80 000 in the 2016 budget, of which by the end of September only US$16 had been made available to the hospital.
Around the same time, of the US$1 million allocated to Bulawayo’s Ingutsheni Hospital, an institution for the mentally challenged (which require US$200 000 every month to cater for its 600 plus patients), only US$70 000 had been made available.
So severe has been the financial squeeze that two main referral hospitals in the country had to suspend performing medical surgeries because of a critical lack of basic painkiller drugs.
Unlike health and other sectors that easily get the sympathetic ear of international donors and other relief organisations that regularly come in to mitigate the sorry situation on the ground, there are other government ministries and departments that have practically been ignored out of existence.
Last week, media reports indicated that property giant, Old Mutual, was dragging the National Prosecuting Authority (NPA) to court over unpaid rentals running to over US$600 000.
However, when looked at closely, it would only take a miracle for the authority, which was allocated US$950 000 in the current financial year — of which only US$80 000 of it (less than 10 percent) has been made available — to avoid the lawsuit.
Of this US$80 000, about US$35 000 had to go towards paying debts from 2015, leaving only a paltry US$45 000 available.
It therefore becomes understandable how some of the authorities’ employees have resorted to buying their own stationery for use at work.
The trend has been like that and has been worsening by the year since President Robert Mugabe and his ZANU-PF party were re-elected in 2013, bringing to an end to the a coalition government that had breathed life into the country’s economy.
It was under this background where the government is struggling to meet some of the barest of its obligations under its US$4,5 billion budget for the current year, that Finance and Economic Development Minister, Patrick Chinamasa, is preparing himself to present the 2017 budget proposals later this month.
“Chinamasa is presenting pseudo budgets, almost all institutions have received less than 10 percent of what is indicated in blue book … there is virtual money allocated, but nothing in the actual account,” another frustrated government official told the Financial Gazette.
“We have decided that for now, we do not come up with new budgets proposals… we just send the ones we have been sending in the previous years that have remained unfunded, because honestly speaking, there is no point of coming up with new proposals when the government is clearly not in a position to fund them,” the official added.
If there is one man in a job that no sane person would envy, it should be Chinamasa, a man who everyone expects to perform miracles to satisfy everyone salivating over the ever shrinking national cake.
Unlike Jesus Christ of Nazareth who easily made five loaves of bread and two fish more than enough to feed a bumper crowd of over 5 000 people, Chinamasa is a mere mortal who has no such powers.
This has brought to the fore questions on the usefulness of him going on to unroll an extended belt of promises, virtually none of which have a bearing on actualities on the ground.
Economist John Robertson told the Financial Gazette that at the moment, Chinamasa is the last person who should be taken seriously.
“You look at the Minister’s promises on cotton production this time last year. He suggested that more than 500 000 hectares of land would be planted, half of this with direct government support, and a million cotton growers were expected to increase the crop from the disappointing 102 000 tonnes in 2015,” said Robertson.
“The result of all his effort was a crop of only 32 000 tonnes, the lowest in perhaps 60 years and less than one tenth of the quantity we used to grow.
“The words in the budget speech have become meaningless.”
Economist and opposition politician, Tapiwa Mashakada, who was minister of economic planning and investment promotion during the inclusive government between 2009 and 2013, said with the economy in such as bad shape, expecting a realistic budget from Chinamasa would be expecting too much.
“Over the years since 2013 fiscal space has been diminishing due to the economic meltdown.
“The economy has shrunk to 1,2 percent as at 2016. Revenue flows to the State have dwindled.
“To make matters worse nothing is coming from diamonds.
“Technically speaking the government is insolvent. At US$1 billion, the budget deficit is getting out of hand. All this means that the budget can no longer accommodate ministries.
“Talk of the budget is simply academic. It’s a damp squib. A non-event!” charged Mashakada
Bongani Ngwenya, a senior lecturer at Solusi University’s Post-Graduate School of Business told the Financial Gazette that Chinamasa would continue making budget presentations as a matter of statutory governance requirement and obligation, but there is very little he can do to make it work.
“The challenge has been declining fiscal revenues. Zimbabwe’s tax regime is almost 100 percent based on individual and company taxation. As the economy continued performing badly, more and more companies had to close down, throwing thousands of employees into unemployment and informal sector. Hence, most of the ministries and departments are having carry-overs from 2014 and 2015 for example. The situation has also been exacerbated by declining export earnings, and increasing imports demand, further straining the trade balance account. Budget deficits could be manageable, but not recurrent trade deficits,” Ngwenya said.
He said the situation has continued to deteriorate and it is not surprising that the year 2016 has been the worst hit.
“Some ministries and department received as little as 10 percent of their allocated votes during the year 2016. Remember we began the year with a background of government failure to meet its obligation to pay civil servants the 2015 bonuses. That marked the beginning of serious fiscal failure, notwithstanding the fact that it has been the norm that ministerial budget allocations have just been book values in the National Budget, that have failed to translate into matching physical cash and liquidity.”
Ngwenya said without getting the economy out of the woods, there would be no way it would be possible for Chinamasa to present a realistic budget on which the nation can pin its hopes.
“Getting the economy working is the only solution to this problem. Zimbabwe now needs bold structural reforms that are targeted at sound macroeconomic policies, domestic industry revival, and attracting massive Foreign Direct Investment inflows,” he said.
It is these bold structural adjustments that Chinamasa has tried to introduce when he twice announced the suspension of civil servants’ annual bonuses and plans to pare down the bloated civil service to create fiscal space to fund the Zimbabwe Agenda for Sustainable Socio-Economic Transformation (Zim-Asset).
And twice his bold measures have been shot down by President Mugabe, putting Chinamasa in an even invidious position.
“I am grateful to His Excellency (President Mugabe) for allowing me, in the management of the economy and on many occasions, to lead from the front while ensuring from behind that I maintain the correct line,” Chinamasa, who appears more than happy to play fools happily, said in the opening statement of the 2016 budget.
President Mugabe has never appeared to take the budgetary restrictions seriously.
Two of most disastrous events that have affected the economy — the country’s 1996 intervention into the war in Congo and the 1997 awarding of gratuities and life pensions and benefits to the former fighters in the war of liberation — were both done without him thinking twice about their implications on the country’s budget, nor was Parliament consulted.
Nkosana Moyo, former minister of Iindustry and international trade who in 2001 made history by resigning when his principle and politics could not be reconciled, this week told the Financial Gazette that everything boils down to the competence of the people running government.
“The problem is not the budget. The problem is a shrinking economy. The government has to find a way to revive the economy. The rest follows from that,” Moyo said.
“The short answer is nothing will happen until corruption is routed out of government and competent people run the government,” he added, further noting that this was partly the reason why he decided to call it quits.
Only last week, legislators were on the razzle in Bulawayo where for three days, they were at a pre-budget seminar, haggling over which areas should be given priority attention, but only God and the gods know where those resources will be coming from.
COMMENTS
The money has all been stolen!! Overseas travel to singapore, chinese bank accounts, zpf rallies, zpf appointee’s ‘salaries and perks’, parastatal plundering, city council plundering, reserve bank plundering, mineral/export earning’s plundering etc etc.
What budget?? It’s all a big joke……