Treasury says it is mulling over preparing an investment-oriented budget, which will be a complete departure from a heavily consumption fiscal plan.
This follows long-standing concerns from commentators and economic think-tanks that the country’s budget largely focuses on consumption other than investment, citing the Ministry of Agriculture, Irrigation and Water Development financial plan.
In an interview on Monday, Ministry of Finance, Economic Planning and Development spokesperson Davies Sado confirmed that discussions are ongoing to ensure balancing the national budget between consumption and investment.
He, however, could not divulge more information on how Treasury and ministries, departments and agencies (MDAs) will to ensure that the budget is balanced.
Sado said the discussions are mainly internal as Treasury is working on the 2019/20 budget framework. The new budget is expected to roll out on October 1 this year.
“We are currently coming up with the 2019/20 budget framework and these are internal matters that we are continually discussing as Treasury with various ministries, departments and agencies, including the agriculture ministry,” he said, observing that decisions on resource allocation are determined by MDAs based on existing plans and priorities.
Minister of Agriculture, Irrigation and Water Development Kondwani Nankhumwa in an interview last week said the ministry is aware that most of its previous allocations have been largely on consumption, with a large chunk taken up by the Farm Input Subsidy Programme (Fisp).
The shift will be in tune with the five-year $3.2 billion National Agriculture Investment Plan (Naip) that provides a framework to coordinate and prioritise investments by various government agencies, development partners and non-State actors in the agriculture sector.
Said Nankhumwa: “You might have noted that we are talking more about irrigation investments. This means we have hope that things are going to improve as we move forward so that we balance our agriculture budget between Fisp and investments into other areas.”
Economists and agriculture experts feel the Agriculture Ministry budget has heavily been on consumption, especially on Fisp, which consumes about half of the ministry’s budget.
For instance, in the 2018/19 Budget, out of the K78 billion allocated to the agriculture sector, K41.5 billion was spent on Fisp, while in 2017/18, K33.1 billion was allocate d to Fisp from K192 billion.
In the 2016/17 Budget, Fisp was allocated K33.1 billion from K198.5 billion while in 2015/16 Budget, Fisp was allocated K40 billion from K133.7 billion agriculture budget. CisaNet national director Pamela Kuwali said government should align the budget to the Naip and go beyond Fisp