Last week saw Members of Parliament gathered in the resort town of Victoria Falls to dialogue on the forthcoming 2012 National Budget expected to be presented to the House of Assembly on November 17 2011.
This pre-Budget seminar follows recent country-wide public hearings by the Budget, Finance and Investment Promotion Portfolio Committee that sought to solicit public input into the crafting of the next Budget.
The question on many people’s lips is: What tangible results will come out of all these seminars and hearings? Will Parliament be able to influence the content and shape of the Budget that Finance minister Tendai Biti will bring to the august House? Is this consultation meaningful or a mere public relations exercise or roadshow?
My answer to these questions is that such forums for dialogue are very important to engender a participatory and democratic budgetary process. What has to improve is for the Executive to consider seriously and incorporate input from Parliament.
We are already seeing positive signs the Ministry of Finance believes Parliament is a key stakeholder in the Budget process, and that it should not merely exist to play a rubber-stamping role.
Tendai Biti has shown that he can be receptive to constructive recommendations coming from the Budget, Finance and Investment Promotion Portfolio Committee.
This is why he agreed to include a provision in the Public Finance Management Act that empowers the Parliamentary Budget Committee to conduct hearings during the formulation of the budget.
On October 5, we witnessed a significant development on the budgetary process when Tendai Biti tabled the first Budget Strategy Paper (BSP) in the House of Assembly.
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The BSP provides the macroeconomic framework under which the Budget is being crafted and proffers priority areas for funding. The BSP was used by the Budget Committee as a basis for conducting its hearings.
After the hearings, the committee sat down to consider evidence gathered and came up with a report with concise recommendations on how to make the 2012 Budget pro-poor and an effective tool that addresses the social and economic rights of citizens.
The committee’s recommendations have since been submitted to the Finance minister and one hopes some of these will be taken on board.
On agriculture, the committee recommended higher producer prices for grain deliveries, temporary ban on grain imports during the grain marketing season, adequate capitalisation of Agribank, adequate funding for the rehabilitation and development of irrigation facilities that continue to lay idle in some districts and adequate funding of Agritex to ensure that farmers have access to expert assistance for increased productivity.
On the manufacturing sector, the Budget Committee recommended that the government should urgently engage both industry and banks in order to quicken the drawdown process for the various financing facilities put in place to support the productive sector.
The committee also proposed further widening of duty-free imports of industrial inputs and raw materials to reduce the cost of production and the establishment of industrial hubs in the different provinces, towns and cities of the country.
The committee pointed out that it did not make economic sense for example for the Diamond Technology Centre to be established in Harare instead of Mutare. This deprived Manicaland province of downstream benefits of employment creation and local development.
The committee welcomed the $80 million proposed in the BSP for the rehabilitation of power plants and small thermal power stations.
However, taking note of the fact that over $2 billion was needed for the construction of new generation plants and expansion of existing plants, there was need for a speedy implementation of public private partnerships in power generation.
The committee highlighted to the minister that the general public was greatly concerned that the government continued to pay lip-service to the critical issue of privatising some of the public enterprises.
Privatisation would not only bring technical partners, but unlock value for the government and release the much needed funding for national development, while at the same time implementing the indigenisation and economic empowerment programme.
The committee also recommended the development of a compensatory framework to provide some relief to the many depositors and investors who had their funds locked up in Zimbabwe dollar balances during the change-over to the multi-currency regime.
Finalisation of the demonetisation of the Zimbabwe dollar balances would inject liquidity and improve public confidence in the financial sector.
