Zimbabwe’s
Minister
of
Finance,
Economic
Development
and
Investment
Promotion
Mthuli
Ncube
presents
the
2024
National
budget
at
the
parliament
building
on
the
outskirts
of
Harare,
Nov
30,
2023.
(PHOTO
/
AP)
Introduction
From
November
5
to
10,
2024,
Parliament
of
Zimbabwe
held
a
2025
pre-budget
seminar
in
Bulawayo. The
issues
for
discussion
during
the
week-long
retreat
included
reviewing
the
2024
budget
performance,
the
current
economic
situation
and
the
bids
for
the
2025
national
budget
based
on
the
projected
revenue
in
the
financial
year
2025.
The
seminar
revealed
that
the
economy
was
declining
and
many
social
and
economic
sectors
were
underfunded
in
the
2024
budget,
indicating
that
it
was
going
to
be
an
uphill
task
to
meet
the
Vision
2030
targets
of
making
Zimbabwe
an
upper
middle
income
by
2030.
It
became
clear
that
education,
health,
water
and
sanitation
and
energy
were
grossly
underfunded
and
hence
the
majority
of
the
population
were
struggling
and
living
in
poverty.
While
the
economy
is
tipped
to
rebound
from
the
El
Nino
induced
drought,
the
fiscal
space
remains
constrained
and
the
disposable
incomes
of
the
working
class
remains
meagre
and
inadequate.
The
economy
will
continue
to
informalise
and
bleed
jobs
as
the
currency
crisis
continues
and
the
foreign
exchange
shows
little
signs
of
stabilising
in
the
near
future.
2024
Budget
Nearly
Exhausted
in
Ten
months
The
Ministry
of
Finance,
Economic
Development
and
Investment
Promotion
has
indicated
that
all
ministries,
departments
and
agencies
have
to
stop
foreign
travel,
cut
back
on
their
fuel
allocations
by
50%
and
not
make
any
new
procurement
of
goods
and
services
in
the
months
of
November
and
December
2024.
It
said
the
budget
was
severely
affected
by
the
devaluation
of
the
local
currency
by
43%
in
September
against
the
United
States
dollar,
backdated
civil
service
salary
increments
and
the
dwindling
revenue
collections
by
the
Zimbabwe
Revenue
Authority
(ZIMRA).
Where
Did
the
Money
Go?
According
to
Treasury
reports,
by
September
30,
2024,
four
departments
had
utilised
more
than
100%
of
their
approved
budgets.
The
following
are
the
departments
that
had
spent
more
than
budgeted:
-
Office
of
the
President
and
Cabinet
[OPC]
(109%); -
Transport
and
Infrastructural
Development
(162%); -
Agriculture
(105%)
and -
The
Judicial Service Commission
(106%)
Note
To
put
spending
into
context:
o the
OPC
budget
is
not
subject
to
being
accountable
to
Parliament.
But
press
reports
give
some
indication
of
the
large
number
foreign
trips
done
by
the
President
and
Cabinet
ministers,
with
large
entourages,
and
these
are
paid
in
foreign
currency
as
are
purchases
of
luxury
vehicles
fro
this
budget;
o transport
and
infrastructure
show
lack
of
monitoring
and
probably
do
not
show
outstanding
amounts
to
be
paid
to
contractors
[e.g.
on
preparations
for
the
SADC
Summit]
o the
JSC
spends
money
on
“perks”
–
houses,
farms,
vehicles
o agriculture
perennially
funds
farmers
who
year
after
year
default
in
repayments.
Which
Sectors
were
Underfunded?
During
the
same
period
the
following
institutions
had
the
least
disbursements:
-
Zimbabwe
Anti-Corruption
Commission
(7,7%); ZACC
was
underfunded
despite
the
rising
corruption
cases
in
the
public
and
private
sectors,
especially
among
the
elites -
National Prosecuting
Authority
(38,6%); This
is
very
worrying
considering
the
time
it
is
taking
to
prosecute
criminal
cases
in
the
courts
and
some
criminals
going
scot-free
because
of
inadequate
investigations
or
failure
to
prosecute
cases
timeously. -
Public Service
and
Social
Welfare
(19,68%);
This
is
the
ministry
that
has
the
responsibility
of
providing
social
safety
nets
to
the
poor
and
vulnerable
groups
and
provide
fees
for
poor
children
under
the
Basic
Education
Assistance
Module
and
cash
transfers
to
poor
households
especially
during
tough
economic
times
like
the
present
El
Nino
induced
drought. The
underfunding
is
horrific
and
shows
a
lack
of
care
for
ordinary
citizens. -
Health and Child
Welfare
(44,33%); The
underfunding
of
primary
health
care
has
given
rise
to
diseases
like
cholera
in
urban
areas
and
failure
to
offer
basic
services
to
ill
persons
at
primary
health
centres
and
the
low
nurses
to
patient
ratio
and
doctor
to
patient
ratio
in
public
hospitals. -
Environment
and
Climate
(49%). The
level
of
funding
for
climate
change
adaptation
and
mitigation
is
not
commensurate
with
the
level
of
talk
by
officials
at
international
forums
and
shows
up
their
lack
of
commitment.
It
is
particularly
reprehensible
in
that
many
rural
poor
families
have
no
access
to
potable
water
and
electricity.
What
Do
the
Funding
Priorities
Indicate?
It
is
apparent
from
the
aforesaid
budget
performance
statistics
which
areas
the
government
did
not
prioritise.
Health,
anti-corruption,
public
service
and
social
welfare
and
environment
and
climate
were
not
that
big
in
the
scheme
of
the
Executive.
These
figures
relate
to
the
unfortunate
reality
of
our
deteriorating
public
health
system,
the
mushrooming
corruption
in
both
private
and
public
spheres,
the
lack
of
social
safety
nets
for
the
poor
and
vulnerable,
and
token
attention
to
emerging
climate
change
effects.
On
the
other
hand,
these
statistics
provide
ample
evidence
that
the
Zimbabwean
government
has
an
insatiable
taste
for
extravagant
expenditure.
2024
Revenue
The
tax
revenues
heads
in
2024
shows
how
much
the
government
has
been
relying
on
direct
taxes
to
citizens.
-
VAT
on
domestic
goods
contributed
19% -
PAYE
contributed
22% -
Mobile
money
transfers
(IMMT)
4%
The
above
figures
can
be
contrasted
with
what
business
is
supposed
to
be
contributing
to
the
fiscus.
-
Corporate
taxes
9% While
the
poor
economic
climate
and
failure
of
currency
policies
have
resulted
in
many
businesses
struggling
in
Zimbabwe,
avoidance
by
some
business
has been
condoned
and
a
number
of
foreign
businesses
have
been
exempted
from
paying
taxes. -
Royalties
3%; The
low
taxes
from
royalties
brings
the
spotlight
on
what
is
going
on
in
the
mining
sector.
While
Zimbabwe
has
been
renowned
for
exporting
commodities
such
as
gold,
chrome,
lithium
and
platinum,
it
is
becoming
evident
that
there
must
be
a
great
deal of
smuggling
of
minerals
out
of
the
country, thus
accounting
for
the low
royalties coming in to
the
coffers. -
Customs
duty
7%; One
cannot
escape
the
fact
that
the
low
funding
to
the
NPA
and
ZAAC
also
contributes
to
the
huge
leakages
at
the
borders
where
many
companies
are
either
smuggling
goods
into
the
country
or
are
under-invoicing.
What
Needs
to
be
Done?
It
is
clear
that
the
government
should
implement
the
following
steps
immediately
to
turn
the
tide
from
further
sinking
into
debt:
-
Government
has
to
cut
back
on
wasteful
expenditure -
Government has
to
restructure
its
wage
bill
especially
at
Executive
level
and
at
parastatals -
ZIMRA
has
to
be
more
aggressive
in
tax
collection -
Corruption
should
be
fought
with
everything
at
the
State’s
disposal -
Sovereign
debt
restructuring
–
it
now
stands
at
a
staggering
US$21
billion
[and
perhaps
more] -
The
Government
has
to
start
living
within
its
means
and
stop
overgenerous
handouts
to
top
officials
at
the
expense
of
the
taxpaying
public.
Conclusion
To
borrow
from
South
Africa’s
former
president
Nelson
Mandela’s
famous
speech
on
poverty.
He
said:
“Like
slavery
and
apartheid,
poverty
is
not
natural.
It
is
man-made
and
it
can
be
removed
by
actions
of
human
beings.
National
budgets
must
reflect
our
commitment
to
ending
poverty
and
inequality.”
The
2025
budget
allocations
and
disbursements
should
reflect
Mandela’s
thoughts
and
the
Treasury
should
be
seen
to
be
fighting
poverty
through
national
budgets
reflecting
the
government’s
commitment
to
ending
poverty
and
inequality.
This
is
the
duty
of
and
expectations that
the
public
have
of
the
Treasury
when
it
tables
the
2025
national
budget.
Veritas
makes
every
effort
to
ensure
reliable
information,
but
cannot
take
legal
responsibility
for
information
supplied.
Post
published
in:
Business