Treasury resorts to expenditure cuts amid deficits

In view of budget deficits in the 2018/19 fiscal year which ended on June 30, Treasury says it has resorted to cutting down expenditure.

In an interview yesterday, Ministry of Finance, Economic Planning and Development spokesperson Davis Sado said government contained expenditures within the revised budget and implemented programmes as planned.

“On the fiscal deficit by the end of the financial year, we were within what was projected in the revised budget.

“We are coming up with a proper analysis on what were the actuals,” he said.

Without giving specific figures, Sado said government also made payments which were scheduled during the financial year and that some of the spill-over payments will be made in the current financial year that started on July 1.

He said despite the country being hit by Cyclone Idai, Treasury contained expenditure in terms of the general budget that was also cushioned with support from development partners.

Sado said Treasury will continue to contain expenditures within the current financial year and reduce borrowing to properly manage the budget in all aspects.

In its input into the 2019/20 National Budget, Economics Association of Malawi (Ecama) executive director Maleka Thula challenged Treasury to cut on public debt and also narrow budget deficit if the economy is to sustain the gains.

He said Ecama is not amused with low allocations which he said make it hard to achieve meaningful economic growth as more resources are being channelled to non-productive sectors.

On budget deficit, which refers to the gap between total revenue and expenditure, Thula said Ecama hopes that government will ensure narrowing the gap which he said is a as a result of perpetual huge government borrowing.