Front PageNational News

Goodall hits at Fisp critics

Minister of Finance, Economic Planning and Development Goodall Gondwe yesterday said the Farm Input Subsidy Programme (Fisp), the country’s biggest social protection project, is here to stay.

Speaking during his second leg of the 2015/16 pre-budget consultations meeting in Lilongwe, Gondwe said going forward the governing Democratic Progressive Party (DPP) would not listen to suggestions of terminating the programme.

Gondwe: You can shout against subsidy, but certainly my party will not listen to you
Gondwe: You can shout against subsidy, but certainly my party will not listen to you

Said Gondwe: “You can shout against the subsidy programme, but certainly my party [DPP] will not listen to you. What we [DPP] will listen to is how to improve the system.”

The minister was reacting to the input into the forthcoming budget by the Economics Association of Malawi (Ecama) and the Malawi Economic Justice Network (Mejn).

In his presentation on the agricultuire sector, Mejn executive director Dalitso Kubalasa asked government to consider developing an exit strategy for Fisp.

Kubalasa wondered why the programme is still claiming a lion’s share of the agriculture budget, overshadowing other priority areas such as extension, research, market access and productivity.

In the 2014/15 budget, government allocated K142 billion to the agriculture sector out of which K50.8 billion went to Fisp, targeting 1.5 million beneficiaries.

But the 2014/15 approved estimate was revised upwards by K10 billion at mid-year in January to nourish replanted fields where crops were washed away by raging floods.

That supplementary figure brought the total Fisp budget for the current fiscal year back to K60 billion, roughly about eight percent of the national budget.

Fisp beneficiaries pay a paltry K500 to redeem their bag valued at about K14 500 on the commercial market.

During the meeting, several other participants spoke against allocating a huge chunk of resources to Fisp which they say is merely consumption and not investment.

But Gondwe, while describing some of the ideas as ‘good,’ put his foot down on Fisp,  saying the essence of the programme is to uphold the welfare of the poor.

Former president the late Bingu wa Mutharika introduced Fisp in 2005, defying criticism from some  development partners, targeting vulnerable people in society. Since its introduction, the number of beneficiaries has averaged 1.4 million. However, many critics have called for the need for beneficiaries to graduate and government to devise an exit strategy.

But Gondwe said the majority of smallholder farmers in the country are unable to purchase fertiliser on the conventional market.

He feared that ending Fisp would culminate into most Malawians resorting to eating maize husks (madeya).

Said Gondwe: “Yes,  we know that there is mal-administration and corruption in the system [of Fisp] and we believe we can iron out those and we will be introducing a number of changes in the system.”

Last year, Ecama calculated that government could save K22.4 billion in the implementation of the Fisp if the cost of purchasing fertiliser could be equally shared with beneficiaries.

Other critical issues raised during the meeting included a call by Kubalasa for government to put ideas into practice in the 2015/16 National Budget and avoid business as usual.

On behalf of Ecama, banker Chiku Kalilombe observed that there has been no revenue growth at Malawi Revenue Authority (MRA) while at the same time there has been an increase in recurrent expenditure by government.

Kalilombe also said going forward, parastatals should not be expense centres, but revenue generation entities for government.n

 

Related Articles

Back to top button