What Parliament said about Ncube’s 2019 budget

The Parliamentary Portfolio Committee on Budget, Finance and Economic Development has expressed concern that Zimbabwe might not be able to implement projects in its 2019 budget because the costs might be higher than presently budgeted for because of the disparity between the United States dollar and the bond note and electronic money.

The government and the Reserve Bank of Zimbabwe insist that the US dollar and the bond note and electronic money are at par but the market has adopted a three-tier rate which shows they are not.

Committee chairman Felix Mhona said yesterday when he presented the committee report: “The Committee is ..concerned with the likely challenges arising from implementing a US$ budget with devalued Bond or RTGS payment systems which imply huge costs on programme implementation.

“The fallacy of a US$ budget against Bond notes medium of exchange is threatening the implementation of this budget and negates the impact of the proposed reforms as the allocated resources are inadequate to meet expenditure forecasts, in real terms.

“The committee therefore wonders how the budget is going to account for Revenue and Expenditure where one part is forex and the other RTGS/Bond. One cannot discount the potential for illegalities and rent seeking behaviour.”

Mhona said Zimbabwe had never been short of good economic policies. The problem was implementation.

“The Committee commends the Minister for crafting a progressive budget which seeks to address the twin deficits that have for long militated against growth of the economy,” he said.

“Zimbabwe has never been short of good economic policies but the only set back has been the lack of implementation and policy inconsistencies. Implementation and unity of purpose are key to achieving the budget objectives.”

Below is his committee report in full:

HON. MHONA: Thank you Mr. Speaker Sir. I rise to present a Committee Report on the analysis of the 2019 National Budget. The 2019 National Budget themed “Austerity for Prosperity” was presented by the Minister of Finance and Economic Development, Hon. Mthuli Ncube on 22nd November, 2018. The Budget is influenced by the country’s long term goal of transforming the country into an Upper Middle-Income society known as Vision 2030. To achieve this vision, Government developed a short-term stabilisation strategy – the Transitional Stabilisation Programme (TSP) to run from October 2018 to December 2020. The TSP’s immediate objective is macro and fiscal stabilisation and laying a solid foundation for attaining strong, sustainable and shared growth.

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