Malawi: Cama Discredits Malawi 2020/21 Budget, Bemoans New Taxes

13 September 2020

The Consumers Association of Malawi (CAMA) has described the Tonse Alliance's first national budget as empty and a total departure from the litany of promises the Tonse Alliance made prior to the Fresh Presidential Election (FPE) on June 23, 2020.

CAMA executive director, John Kapito, in a statement issued on Saturday, said the 2020/21 National Budget Statement which Finance Minister Felix Mlusu delivered in Parliament in Lilongwe on Friday, does not respond to any economic recovery of the country.

Kapito said it is sad that the budget is not capturing any of the promises the alliance made during the campaign.

"A budget is a commitment and letter of intent with Malawians and most Malawians expected that the new government would do things differently from the previous government. Unfortunately, the current budget statement is unable to articulate key issues that the government needs to pursue in order to resuscitate the ailing economy, it has made a lot of assumptions that are unattainable and completely impossible to achieve when it has ignored the basic things that can generate resources that are key to support many projects and activities that are in the budget," he said.

Kapito wonders why the budget formulators did not include the universal fertilizer subsidy programme, free electricity and water connection, reduction in passport and driving licenses and the creation of jobs and removal of taxes on some basic goods and services as promised during the campaign.

"Instead, the budget has introduced measures that will hurt many consumers such as the introduction of a new tax on some products such as cooking oil and taxes on winning bets, which has become a new income generator to many unemployed Malawians, most of Malawians are not employed and the increase of the tax threshold will not benefit as many Malawians," he narrates.

He further states that the budget is selective to benefit a few Malawians and defeats the whole purpose of a Nation Commitment Statement.

The consumer organisation stressed that the budget statement is "completely empty" without Tonse Alliance pledged universal fertiliser subsidy, reducing fees for passports, duty free weeks, and zero-connection fees for electricity and water. .

"Malawians are looking for a leadership that is focused, visionary and understand that needs of its population and is able to keep the trust and credibility with its people. It is unfortunate that the budget is a complete departure from what Malawians expected from the current administration.

"Malawians removed the previous administration because of its failure to understand the economic challenges and we don't see the difference between the old and the new administration. We expected this new administration to have done things differently than this sham of a budget that is given," reads the statement.

But Mlusu pledged that the Affordable Inputs Programme [AIP] will reach out to 4.2 million farm families, saying it is "not far from being a universal subsidy program."

On free water and electricity connections, Mlusu reiterated government's commitment to ensure implementation of the initiative after reforms at the State utility companies.

The Treasury czar said the outlined programmes in the budget will ensure that one of the key components of the Tonse manifesto--the creation of one million jobs--materialises.

The minister said the job creation agenda will be buoyed by a number of several initiatives that have already been initiated.

Some of the initiatives Mlusu mentioned included establishment of modern and fully equipped job centres which will first be established in Lilongwe, Blantyre and Mzuzu.

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