}

2011 Zambian budget - "people's budget from people's government"

On 8th October 2010 the Zambian finance minister Situmbeko Musokotwane presented the 2011 Zambian budget of K20.5 trillion amid expectations and skepticism from the general public.


The people feel let down some how despite the fact that the Zambian economy has been registering positive growth for some years now. This growth has however not trickled down to the man on the street and its effect hasn't been felt.

Reduction in grants

The most notable thing in the 2011 Zambian budget had been the reduction in grants by co-operating partners who haven't recovered from the alleged misuse of funds by some beneficiaries especially in the health sector. By comparison, the country has received half the amount of what it got last year. In the 2010 budget, donor support was 14.4 percent compared to 7.7 percent in the 2011 Zambian budget.

Sources

Despite the set back from donors, the finance minister went ahead with his K20.5 trillion budget, which he dubbed, 'peoples budget from peoples government', which he intends to source through increases in both external and foreign borrowings.

76.8 percent or about K15.76 trillion will come from domestic revenue. 15.5 percent deficit will be financed through domestic borrowing.

Pay as you earn (PAYE) continues to be the biggest source of revenue in the 2011 budget, with about 48 percent of total direct revenues expected to be collected in the 2011 Zambian budget. However, the employee out there will feel relieved at the increase in the exempt thresh hold by 25 percent from K800, 000 to K1000000.

Expenditures

Expenditures for economic affairs, health and education got increased allocations and these expenditures will all together, account for over half the 2011 Zambian budget. Most of the sectors in different ministries got increased allocations. 28.5 percent of the 2011 Zambian budget will go towards expenditures on general public service. From this allocation, K244.6 billion is geared for the 2011 tripartite elections.

The agricultural ministry got K485 billion for the 2011 Zambian budget which is higher than last years allocation of K435 billion. Allocation to the farmer input support program increased to K485 billion. Last years bumper harvest justified an allocation of K150 billion to the food reserve agency (FRA) to enable it sustain bumper harvests and avoid wastage of revenue and food to the farmer.

The road and infrastructure development programmes in the ministry of transport and communication had K3 trillion in 2011, up from K1.4 trillion in 2010.The rural roads unit had K28.4 billion meant for the rehabilitation or upgrading of airports and airstrips at Kasama, Mansa, Mongu and Kasaba bay.

The tourism sector, which has experienced an increase in the number of visitors due to misfortunes in neighboring Zimbabwe, was allocated K63.3 billion. Focus in the budget was on roads and infrastructure development. For these developmental projects, the Kafue and Lusaka national parks got K37.7 billion. Further, the sector got another K26.6 billion for the marketing of tourism sites.

The health sector was allocated 30.1 percent K 1,772.9 billion for 2011, an increase of 30.1% compared to last year. The increase came at a time the ministry of health was hard hit by striking workers demanding better conditions of service. And the fact that the ministry is the largest recipient of donor funding and therefore, hard hit by the withdrawal of grants by the donors.

The ministry of education was allocated 18.6 percent for its developmental programs. Construction of new basic schools and new high schools will lead to an increase in the intake of pupils. Renovations of tertiary and college institutions will increase the number of teachers as well. The 2011 budget allocation represents a 15.3 percent increase compared to the 2010 budget.

Over view/comments on 2011 Zambian budget

Some sections of society have labeled the 2011 budget as unfriendly and not accommodating to the poor. The opposition Patriotic Front (PF) Leader M.C. Sata has been on record as saying the poor can probably wait for another budget that will take care of their needs. The partial withdrawal of funding to the budget has mean while presented itself as an opportunity for the country to do away with donor funding, this is according to Mr. Love Mtesa executive member of Consumer Unity Trust Society (CUTS).

The consumer unity trust society (CUTS) international, has advanced the argument that with a capital formation focused budget, coupled with a well implemented procedure, it is possible in the short and long term to have a donor free budget!

Most people thought the budget was another of those 'government expenditures' meant to increase prices of some household commodities.



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