Treasury waits for new policy direction on budget
Treasury has halted preparations for budget formulation as they await for the new political administration to provide policy direction.
Speaking in an interview, Ministry of Finance Spokesperson Nations Msowoya could not also say whether what indication the donor community was giving on whether it will return with budgetary support or not.
Donors have withheld budgetary support over financial management concerns, following the embezzlement of funds at Capital Hill popularly known as Cashgate where over K13 billion of government money was defrauded.
Parliament is due to reconvene late in June for budget meeting but Msowoya yesterday said the ministry was not pressing the panic button yet.
“We should wait for policy direction from the government. Between now and June 30, 2014, we have adequate time to prepare the budget and finalise it,” said Msowoya.
Earlier, the treasury announced it had pegged expenditure and net lending in the 2014/15 fiscal framework at K693 million out of which K181 billion is development expenditure, government has disclosed.
Despite the anticipated donor freeze, such a figure is K52.7 billion higher than the K640.3 billion revised budget as of December, 2013.
As reported by The Nation, revenue and grants was projected at K617 billion but the figures are up for changes depending on policy direction of the new administration.
“The 2014/15 budget framework assumes no government budget support and we feel there is need for continued public finance management systems for Development Partners to return to using country systems [UCS],” then said Betty Ngoma, assistant director, Debt and Aid Division in the Ministry of Finance in Lilongwe last week.
The budget under formulation by the outgoing administration envisaged absence of foreign support, a move akin to the zero-deficit budget once implemented by the Democratic Progressive Party (DPP) government in 2011.
