Leader of opposition in Parliament Lazarus Chakwera has accused the government of ignoring the private sector as the country seeks to increase productivity and improve revenue collection.
Commenting on the state of the economy in his response to President Peter Mutharika’s statement during the opening of the 46th session of Parliament on Friday, Chakwera on Monday said there was evidence that the government was bent on stifling the private sector by failing to pay them arrears owed to them.
He said by end of June 2015 only K10 billion ($17,857,143) of the estimated K157 billion ($280,357,143) owed to the private sector had been repaid.
Said Chakwera: “At any rate, the private sector is already losing out as they have to discount them with the commercial banks despite the fact that the value of the credit has already been lost through time.”
He wondered how the government would make up for lost revenue which donors have withheld if the private sector could not be given room to breathe.
Chakwera said consumption activities such as Decent and Affordable Housing Subsidy Programme, widely known as Malata and Cement Subsidy, would not generate revenue for the future of no budgetary support.
He said: “Who in their right mind increases consumption when productivity is shrinking? Besides, when are we going to open our eyes to see that knee-jerk subsidy programmes are the most vulnerable to abuse?”
However, Chakwera said much as Malawians deserved better housing, Malawi Congress Party (MCP) believed the subsidy was not the best way, but to increase the capacity of Malawians through private sector jobs and businesses that generate enough income for them to build their own houses.
In his budget statement in June this year, Minister of Finance, Economic Planning and Development Goodall Gondwe argued that the 2015/16 National Budget was not a consumption budget as 25 percent of the budget was for development such as investments on roads, but admitted that the government would do better next year to increase investments in tourism, trade, mining and energy. n