The budget presentation was in compliance with Section 305 of the Constitution of Zimbabwe and Section 28(1) of the Public Finance Management Act [Chapter 22:19]. The Budget adheres to the PFMA, the Reserve Bank Act [Chapter 22:14] as well as the Public Debt Management Act [Chapter 22:21] with regard to fiscal targets on level of budget deficit, Central Bank lending to Government and public debt. Moreover, an allocation of US$30m to Provincial and Local tiers of Government is in compliance with Chapter 14 and Section 301(3) of the Constitution which provides for allocation of “not less than give cent of the national revenues raised in any financial year to the provinces and local authorities as their share in that year”.
The Budget, Finance and Economic Development Committee sought and received stakeholder reactions on the 2019 Budget from the Bankers Association of Zimbabwe (BAZ), Zimbabwe National Chamber of Commerce (ZNCC), Chamber of Mines (COM). Confederation of Zimbabwe Industries (CZI), Ministry of Finance and Economic Development, Zimbabwe Council of Churches and the Insurance and Pensions Commission (IPEC). The consultations were done against a backdrop of budget input obtained from public bearings done in compliance with Section 28(5) of the PFMA [Chapter 22:19].
Extent to which Committee Recommendation were Incorporated into the Budget
The Budget, Finance and Economic Development Committee commends the Minister for incorporating some of the Committee recommendations into the 2019 Budget. These include;
- Revoking the retention authority for retention funds created in line with Section 18 of the PFMSso that all revenue is deposited in the consolidated revenue fund in line with Sec 302 of the Constitution- (paragraph183);
- Commitment to review the Command Agriculture financing mechanism with a view of sharing the burden between Government and the private sector (Paragraph 278);
- Availing US$5.3 million to facilitate more surveys required for granting 99 year leases. There is however need to make these leases bankable assets, as recommended by the bankers or transferrable;
- Allocating $300 million towards rehabilitation of the Beitbridge-Masvingo which is expected to cost US$1.2 billion and to be funded from an Infrastructure Bond,(Paragraph 392-402);
- Allocating US$310 million to Provincial and local tiers in line with Chapter 14 of the Constitution (Paragraph 661);
- Allocating US$686.9 million (inclusive of health levy) to ensure that the referral system is re-established in order to reduce bottlenecks being experienced at tertiary and central hospitals (Paragraph 483).
- Suspending duty and tax on sanitary wear for a period of 12 months beginning 1 December 2018 (Paragraph 837-838) and proposal to exempt imports of sanitary ware from Value Added Tax;
- Suspending Duty on Goods for use by Physically Challenged Persons (Paragraphs 839-844);
- Efforts towards establishing a One Stop Investment Centre which has been on the cards for more than 10 years. There is acknowledgement of cabinet approval of the establishment of the Zimbabwe Investment Development Agency (ZIDA), through amalgamation of investment agencies. Action is however needed beyond the usual rhetoric; and
- Restructuring AGRIBANK to revert back to its core functions of financing agriculture.
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