Opposition Democratic Progressive Party (DPP) has described Minister of Finance Felix Mlusu’s Mid-Year Budget Review Statement as reflecting a governing philosophy that has promised so much to Malawians but only delivered lies
Making its official response to the statement delivered in Parliament last Friday, DPP spokesperson on finance in Parliament Joseph Mwanamvekha yesterday also said the statement was tilted in favour of the rich with nothing for the ordinary Malawians.
He rei t e r a ted his description of the 2020/21 National Budget as “consumptive as opposed to development-oriented,” unfriendly to the business sec tor, unrealistic , overburdening in debts and total loss to Malawians.
Mwanamvekha said: “He [Mlusu] was tasked to deliver unattainable and insurmountable promises which he was not party to. I still feel sorry for the minister and we will still keep him in our prayers.”
Turning to President Lazarus Chakwera’s Sunday night speech on Covid-19, he rejected the biblical analogy of Israelites heading to Canaan from Egypt, saying “Canaan is now heading towards Baghdad, the capital city of Iraq!”
Mwanamvekha, who was the last minister of Finance in the DPP administration booted out through the court-sanctioned fresh presidential election held on June 23 2020, said the budget has missed both the revenue and expenditure targets. He cited the failure to collect the targeted domestic revenue of K600 billion during the period under review with only K564 billion collected, representing a shortfall of K36 billion.
On the expenditure side, he said instead of spending K975 billion, it spent K998.5 billion, representing an increase of almost K24 billion which caused net borrowing of approximately K30 billion as at end of December 2020.
Furthermore, instead of borrowing K266.3 billion at end of first half, government borrowed K350.9 billion of which K304 billion was borrowed locally, thereby overcrowding the private sector.
Mwanamvekha said this signifies that the budget is unrealistic, citing reported depletion of foreign reserves from $846.6 million in December 2019 to $574.3 million in December 2020 as further evidence.
“This means that this government is failing to generate enough forex reserves. Malawians should brace for tougher times ahead as they will scramble for the little foreign exchange reserves.
“If they are lucky to get these reserves, they will get them at a much higher price than it was under the DPP government,” he said.
But the DPP’s response did not acknowledge the impact of the Covid-19 pandemic in the status quo, including on the missed targets, with Mwanamvekha highlighting a number
of campaign promises he said were not delivered. He mentioned the K15 000 monthly allowance for citizens aged 65 and above, non-renewable passport at K14 000, a duty-free week, mega farms in every constituency and one million jobs during the first 12 months.
But the mention of the promise to reduce the cost of an ordinary passport to K14 000 prompted Leader of the House Richard Chimwendo Banda, who is also Minister of Homeland Security, to rise on a point of order.
He said the new administration is yet to implement the passport pledge because once in office, it found a passport deal worth $60 billion (K90 billion) which the DPP administration signed with a passport supplier; hence, is waiting for the expiry of the agreement.
But Mwanamvekha said he was not aware of the said agreement and wondered why the new administration was not terminating the contract to deliver its promise