Despite numerous projects critical for economic growth stalling for years due to scarcity of funds, government has lined up new projects in the 2019/20 budget, raising questions on its priorities.
The Public Sector Investment Programme (Psip) for 2019/20 which outlines all government projects shows that there are 189 new projects to implement, on top of 187 ongoing ones.
The new projects require in excess of K1.2 trillion. Out of this figure, about K914 billion is expected to come from local resources while K300 billion is expected from loans and grants.
Professor Ben Kaluwa, an economist in the University of Malawi, says the mix-up of priorities in the national budget is a case of poor leadership.
Among the new projects is construction of stadia for privately owned Nyasa Big Bullets and Be Forward Wanderers football clubs.
The move has sparked public debate, questioning government’s interest to support private and commercial entities at the expense of public infrastructure projects.
Officials from the Ministry of Sports, led by Principal Secretary Chancy Simwaka, had to endure a barrage of questions during a cluster meeting of Parliament last Friday.
MPs wondered why government is keen to support the two private football clubs with construction of stadiums when other public stadia were in a state of neglect.
The MPs cited the Bingu National Stadium (BNS), which has potential to generate funds, but is perpetually in dire financial stress.
“What’s the philosophy behind this project? Why should government fund private entities? The clubs could be struggling, but should it be government’s job to recaptalise private business?” queried Karonga Central legislator Cornelius Mwalwanda, who is also a former deputy finance minister.
Simwaka clarified that the two stadia will belong to government and that the two clubs will simply be managing them. He said government plans to do a similar arrangement with other clubs in future.
He told the committee that government may consider naming the stadia differently to avoid perception that they belong to the two clubs. Simwaka had to justify the significance of the project amid many priorities in the sports sector.
The Bullets and Nomads stadia project has been allocated K1.6 billion in the proposed financial plan presented to Parliament by Finance Minister Joseph Mwanamveka last Monday. The funds are meant for preparatory work; environmental impact assessment, designs and construction.
Ministries, departments and agencies (MDAs) present projects to Ministry of Finance, Economic Planning and Development for inclusion in the Psip, which are carefully analysed and only projects that are in line with key priority areas in the Malawi Growth and Development Strategies (MDGS III) are included.
The priority areas are agriculture, water development and climate change management, education and skills development, transport and ICT infrastructure, energey, industry and tourism development, and health and population.
According to the Psip, 126 of the proposed 187 ongoing projects are recommended to continue. Ongoing projects have been allocated K105.8 billion from government’s own funds.
Of the 189 new and previous pipeline projects, only 30 project proposals have been recommended for inclusion in the 2019/20 Development Budget at K15.7 billion from government’s own resources.
“The Psip prioritises the ongoing projects over the new projects but these few new projects have been considered and proposed for inclusion in the 2019/20 Budget because of the urgent need and their contribution to the key priority areas in the MGDS III”.
In its analysis of the 2018/19 National Budget, UNDP also noted that the previous financial plan failed to align itself more to MDGS and SDGs. The UNDP urged government to continue implementing sound macroeconomic policies aimed at spurring growth and creating jobs by focusing on productive sectors as outlined in the MGDS III with strong multiplier effects.
Asked to comment on the new proposed budget, UN resident coordinator Maria Jose Torres said they are analysing it to appreciate how it is aligned to MGDS III and SGDs.