5 December 2012

Zimbabwe: Ministers' Financial Indiscipline Exposed

Ministers in the Coalition Government Have Been Exposed for Their Fiscal Indiscipline Which Has Seen the Executive Incurring Huge Amounts of Money in Unapproved Expenditures and in Violation of the Law.

In a report tabled in Parliament last week, the Budget and Finance Committee said the disparity between approved expenditures and the actual figures has been going on for years, but the trend should no longer be tolerated. In other words, all funds used by the government should come from the national budget approved by Parliament.

The committee no-ted with concern huge discrepancies between appropriations approved by the legislature and actual expenditures in the previous years hence calls for the executive branch to ensure that expenditures only rel-ate to approved programmes.

"Variations without Parliament's approval will no longer be acceptable," reads part of the report by the committee chaired by ZANU-PF Goromonzi North lawmaker, Paddy Zhanda.

The committee said there was lack of political will and seriousness by government ministers regarding parastatal reforms at a time the state firms were proving to be a drain on the fiscus.

While Finance Minister Tendai Biti keeps referring to the subject in all budget pronouncements, little progress has been made in turning around the loss-making parastatals.

The committee is now recommending the formulation of specific timeframes for the revival of each parastatal, with emphasis on adherence to the timelines.

The lawmakers also recommended the setting up of a taskforce comprising government and private sector representatives to come up with solutions to challenges affecting the manufacturing sector.

Regarding the Distressed Industries Marginalised Areas Fund, it was felt that no particular region could be said to have been marginalised. As such, the committee said the facility should cover all provinces, targeting industries with the potential to recover.

The committee also emphasised the need for disclosures on the facility with respect to the beneficiaries and jobs saved and created.

"The committee believes that funding alone is not the panacea to industry's problem considering that some of the ailing companies have always had access to financial support but still remain distressed," the committee noted.

"There is, therefore, need to look at the issue in a holistic manner to identify the sources of the problems and to come up with appropriate solutions.

"The committee believes that some of the problems are of a structural nature whilst some need supportive policy measures."

The recommendation comes nearly four years after the formation of the Global Political Agreement, which paved the way for the inclusive government was signed. The power-sharing pact stipulates the creation of an economic think-tank -- the National Economic Council (NEC) -- consisting of government and business.

Up to now, the NEC is still to be established.

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