FINANCE, Economic Development and Investment Promotion minister Mthuli Ncube has been challenged to explain why some ministries exceeded their approved budgets before mid-year.
In a motion on the Finance Bill, Budget and Finance Committee chairperson Clemence Chiduwa expressed concern over unauthorised spending calling on Ncube to provide a detailed explanation.
Chiduwa emphasised the need for a debt sustainability analysis and Medium-Term Debt Strategy by November this year to monitor debt sustainability.
He questioned how ministries that had overspent by June will manage to operate without a supplementary budget, highlighting potential risks to financial stability.
“Public debt significantly increased in 2023. This may retard the economy’s growth prospects, as we target Vision 2030; some ministries have already surpassed the budget allocation approved by Parliament, while others have used less than 30% of their budget allocation during the first half of the year,” Chiduwa said.
He also recommended that Treasury should remove duty on transit fuel and implement measures to curb transit fraud, adding that the Zimbabwe Revenue Authority faced challenges in addressing transit fraud and collecting taxes from the informal sector.
“Government plans to increase demand for the local currency by requiring payment of at least 50% of corporate income tax liability in local currency.
“VAT [value-added tax] exemption should be extended to other meat products and presumptive taxes have been reviewed to promote voluntary compliance.”
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Chiduwa, however, said concerns persisted over transit fraud, which undermined border control and excise duty revenue collection, compulsory payment of duty for fuel in transit contradicts the Sadc Protocol on trade and should be reconsidered.
Mbizo legislator Cobalt Madzivanyika (Citizens Coalition for Change) also expressed concern over five ministries which overspent, highlighting the Transport ministry’s 245% overspenditure and the Council of Chiefs’ 119%.
He questioned whether the unallocated reserve of ZWG16 trillion will be sufficient to cater for such variances in spending.
“The Ministry of Education has utilised 26% of what was budgeted for, but look at the dire circumstance of our education sector,” he said.
Bikita South legislator Energy Mutodi (Zanu PF) praised the government for financial prudence, citing the ministry’s departments and agencies refilling half of their budgets and spending 44% of their allocations.
“I would like to applaud for refilling that half of the ministry’s departments and agencies and spending 44% of their budgets which is in line with the Sadc macro-economic convergence indicators. This shows that the country is performing very well in terms of financial prudence,” he said.
