Mejn calls for realistic budget projections

Malawi Economic Justice Network (Mejn) has called for a sober “after action budget and policy review”, pushing for more realistic budget projections by fiscal authorities.

In his presentation to the Budget and Finance Committee of Parliament prior to the unveiling of the 2016/17 Mid-Year Budget on Friday, Mejn executive director Dalitso Kubalasa faulted the tendency for flowery projections that are usually far-fetched and end up not being realised.

“For instance, realism would greatly serve us, especially when we at times all know that a seven percent economic growth rate projection in a particular period may not be realistic.

“I woud rather we be honest and true to ourselves than confine ourselves to a policy fantasy world. If realism points to a possible two percent economic growth projection, let us say so and honestly pursue its progress.”

In past, fiscal and monetary authorities have set growth projections that have not been met only to review them downwards.

For instance, at the presentation this current fiscal year’s budget, Minister of Finance, Economic Planning and Development Goodall Gondwe put growth for 2016 at 5.1 percent.

However, the figures has been revised downwards to around 2.8 percent due to the subdued growth in the agriculture sector.

Kabalasa noted that time has come to tell Malawians the true picture of the country’s economy, national plans as well as national budgets, stressing that much as it is always good to be ambitious, it is important “that we also be as realistic as possible beacuse it is not helping anyone”.

During the meeting, members of the committee expressed their appreciation for the partnership they have with Mejn and said they look forward to to Mejn’s promised comprehensive mid-year budget analysis at micro and macroeconomic fundamentals.

In response to the committee’s sentiments, Kubalasa agreed that it is indeed important to look at the bigger picture, always striving to learn from the micro level of the public finance management, because they are the ones that cumulatively escalate into the bigger picture at the macro-economic level of public finance management systems.

Among other things, the meeting also discussed the alarming challenges surrounding accountability particularly in the Constituency Development Fund (CDF), Local Development Fund (LDF) and the District Development Fund (DDF) and how all players inthe economy need to gang up in a “business unusual” manner towards bailing Malawians out of the dungeon of poverty.