Zimbabwe’s Parliament too expensive to maintain

Q & A:

HON. MUDEREDZWA: My question is directed to the Minister of Finance and Economic Development, Hon. Chinamasa.  Considering our interface by way of policy with the World Bank and the International Monetary Fund and considering the fact that we have been complying with the requirements that they have raised, what is the current position and grand plan that now exists between our country and these institutions?

THE MINISTER OF FINANCE AND ECONOMIC DEVELOPMENT (HON. CHINAMASA):  The Hon. Member is asking what our relationship is with the World Bank and the African Development Bank and the International Monetary Fund.  The short answer is that we cleared our arrears last year to the IMF in the sum of around US$107.9 million.  We are now in the process of seeking to clear our arrears with the World Bank and the African Development Bank.  Those two institutions are ready to receive our money and we are in the process of mobilising the necessary resources. In short, it is work under progress.

HON. P. D. SIBANDA:  Hon. Minister, one of the reasons why our relations keep strained with the international financial institutions is because of fiscal indiscipline that has been highlighted by international financial institutions for a long time.  These indisciplines include unlimited borrowing on the market not for productive purposes, uncontrolled expenditure including unnecessary foreign travel.  What are you doing as Treasury to ensure that you reduce the fiscal indiscipline that is currently prevailing in our economy?

HON. CHINAMASA:  The Hon. Member is not correct to say that there is fiscal indiscipline.  The challenge we have is to contain expenditure and a lot of that expenditure sometimes is necessary but of course, we said we have to live within our means.  That expenditure is sometimes necessary.  Some of it is constitutional and we inherited it through our Constitution.  We inherited a very large bureaucracy, a very large Parliament, lots of Commissions and provincial entities.  All these need to be funded and it is a constitutional obligation.  When I now seek to fund them, it is called fiscal indiscipline.  It is not so.  I am merely meeting the constitutional obligation that I have; to meet Government expenditure and programmes.

The Hon. Member is wrong to say that the borrowing is totally to do with consumption.  Yes, I do borrow to pay wages but I have tried to balance what goes to consumption and what goes to physical infrastructure.  The House will want to know that the completion of the Tokwe-Mukorsi was done from the budget – from borrowing and a lot of the support that we are giving to the private sector is a result of some of those borrowings.  We identified key private sector players whom we considered, if supported, could revive their operations. I can only mention one or two; Cairns and Rio Zim.  These are not consumptive; they are in the productive sectors. They have been revived, they are creating employment and that is the way we have been managing.

In short, I want to say that our problem is fiscal deficit because of huge Government bureaucracy over which we have very little control. Cabinet has taken a decision by appointing me and the Minister of Public Service, Labour and Social Welfare to address the issue of a huge wage bill and we have been taking measures through rationalisation, redeployment and re-training to reduce that deficit.  We are beginning to observe some savings from the measures that we are undertaking.  I thank you Mr. Speaker Sir.

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