✓Huge debt to cause fiscal pressure to service–Commentator
By Martha Kachingwe Phiri, LILONGWE
There are voices of frustration from the Malawi Congress of Trade Unions-MCTU who argue Finance Minister Simplex Chithyola Banda’s Mid-Year Budget statement is far from meeting their expectations.
The labour rights campaigner demanded a 44 percent increment immediately after the Chakwera administration devalued the kwacha with a similar percentage.
MCTU President Charles Kumchenga says they plan to engage the Government Negotiating Team-GNT to present their grievances.
“Since we are to meet the government negotiating team soonest, possibly this week, we can not pre-empty our feelings and our stand until the government side explain on this package.
“What is well known is that we were expecting above 44% as salary increment so experts will unpack this to us so that we appreciate. Otherwise, without beating about the bush, we are not happy,” says Kumchenga.
But government has increased wages and salaries for civil servants by 10 percent; from K80.05 billion from k900.44 billion to K980. 49 billion.
Meanwhile, economic commentator Kingsley Jassi fears the staggering K12 trillion public debt will cause fiscal pressure to service; tipping authorities to do fiscal tightening and drastically reduce borrowing.
“Government needs to do a lot of saving for the purpose of investing in wealth creating ventures. We’re told they’re going to save in excess of K4bn from the fuel benefits cuts for senior government officials and the money will go towards mega farms. That is what we need to do and we need more of such moves,” he says.
Jassi describes the presented budget as some normal expenditure planning with nothing exciting in terms of fixing the economy.
He argues: “Perhaps, the return of budgetary support can be a major highlight and will ease revenue pressure. It’s a substantial amount but we have to wait and see.
“We’ve seen donors pledge budgetary support but not fulfilling them which has caused fiscal stress before. So the Minister of Finance should be cautious.”
The 2023/2024 national budget has jumped from the initial K3.79 trillion K4.33 trillion due to the kwacha devaluation.
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