Minister of Finance, Economic Planning and Development Joseph Mwanamvekha says he will present the K1.7 trillion 2019/20 Mid-Year Budget Review Statement in Parliament today which includes funding for the fresh presidential election.
The minister was initially expected to present the budget last Friday, but shifted the task to today purportedly to include the budget line for the fulfilment of the Constitutional Court ordered fresh election.
In an interview yesterday, Mwanamvekha said: “The budget statement is ready for presentation tomorrow [today] morning in Parliament. I can confirm that we are ready as a ministry. Whatever the case and all things being equal, we are going to have the Midterm Budget presented in Parliament.
“After the judgement, we had to take into account some of the issues as directed by the court. That is what is also contained in the statement.”
Earlier, Treasury spokesperson Davis Sado admitted the budget has been facing pressure partly owing to under-collection of domestic tax revenue in the past six months.
During the period, which is half of the current financial year, Treasury recorded a deficit of K165.7 billion or about four percent of gross domestic product (GDP), according to figures from the Reserve Bank of Malawi (RBM).
Economics Association of Malawi (Ecama) has since asked Treasury to improve its revenue projections, which forms the basis for budget formulation and that Malawi Revenue Authority (MRA) should improve revenue mobilisation and efficiency in revenue collection.
Ecama acting executive director Kettie Nyasulu forecasted that budget cuts will be inevitable in the mid-term review.
Budget and Finance Committee of Parliament chairperson Sosten Gwengwe said their biggest concern so far is on government’s ‘overambitious’ revenue target in the budget.
“For us, the biggest litmus test is the revenue collected in the first half of the year, apart from the implementation of the budget which we will look at later on,” he said.
World Bank country manager Greg Toulmin last month in Lilongwe said unrealistic revenue assumption in the budget poses a risk to the implementation of the fiscal plan, particularly given the statutory nature of most of the expenditures in the budget.