Blatantly Belated!

-The Sad Saga Of Reneging And Toying With National Mandate

Despite knowing fully well of the binding national mandate and political responsibility driven by law to brief and promptly update the Legislature regarding quarterly performance of the national budget, the reflective reneging posture to live up to such task has created an atmosphere of serious affront; as political pundits brand the snail-pace move by the Ministry of Finance and Development Panning(MFDP) as blatantly belated which is not only troubling and worrisome, but  grave that even raises more questions than answers.

The pundits also wondered what could be the driving motive, crusading force or peculiar reason for such delay or reluctance on the part of the Finance Ministry to perform its official, if not statutory function wherein based upon his quarterly deliberation to that august body; from where the people would be informed through their respective lawmakers without such disturbing gap spanning from July to September; covering the first quarter would not have dragged close to the third quarter which begins January and ends in March.

In spite of the troubling delay gravely nibbed from persistent public outcry about the various quarterly reports based on the performance of the budget in keeping with law; the pundits intoned that the MFDP somehow caved in to the mounted pressure and released a report wherein the first quarter (July-September) was embedded.

According to the Ministry of Finance and Development Planning’s report published no its official website out of the total amount of the budget US$570.1 million, US$319.8 million went for employees’ compensation (salaries), which according to the MFDP constitutes 56.1 percent of the overall approved budget.

The report noted that in terms of Economic Classification, the FY2018/19 approved budget for Compensation of Employees is US$319.8 million constituting a 56.1 percent share of the overall approved allocation of US$570.1 million for FY2018/19. This signifies a 15.7 percent increase compared with FY2016/17 budget of US$276.3 million and a 3.4 percent increase as well compared with FY2017/18 budget of US$309.5 million. This section provides a comparative analysis of FY2016/17 to FY2018/19 approved budgets by economic classification.

The Executive Summary also added that with regard to allotment, in FY2018/19, the amount of US$142.4 million (25 percent) was allotted during the first quarter, compared with US$135.2 million(25 percent) of the approved in FY2016/17 First Quarter, and US$107.7 million (20 percent) in FY2017/18 in the corresponding quarter. This implies that allotments for both FY2016/17 and FY2018/19 First Quarters were 25 percent of their respective approved budgets, while allotment for FY2017/18 was 5 percent less than the FY2018/19 First Quarter allotment.

The low allotment in the First Quarter of 2017/18 can partly be attributed to delay in passage of the budget by the National Legislature which resulted in the Government allotting one twelfth of the previous year’s budget for July and AugustFY2017/18 respectively.

In terms of disbursement, in FY2018/19, the amount of US$108.4 million (19 percent) was disbursed during the first quarter, compared with, US$106.7 million (19.5 percent) and US$90.1 million (16.8 percent) disbursed in the corresponding quarters of FY2016/17 and FY2017/18 respectively.  This implies that the disbursement made in

FY2018/19 First Quarter is 0.5 percent lower than the disbursement made in 2016/17 and 2.2 percent higher than the disbursement made in the First Quarter of FY2017/18. That Figure 2 presents First Quarter Budget Execution for FY2016/17 to FY 2018/19.

As indicated above, approved resource envelope for FY2018/19 is US$570.1 million, which represents 4 percent increase compared with FY2016/17 approved budget of US$547.5 million and 6 percent increase compared with FY2017/18 US536.2 million recast budgets.

In FY2018/19, four sectors (Municipal Government, Health, Education, and Infrastructures and Basic Services Sectors) received increment in their appropriations compared with FY2016/17 approved budget. On the hand, in 2018/19, seven sectors (Public Administration, Transparency and Accountability, Security and Rule of Law, Energy and Environment, Social Development Services, Agriculture and Industry and Commerce Sectors) experienced reduction in their allocations compared with FY2016/17.

Moreover, in FY2018/19 seven sectors (Public Administration, Municipal Government, Health, Social Development Services, Education, Agriculture and Infrastructure and Basic Services Sectors) experienced increase in their allocations.

These sectors received increment in their allocations because of Government’s policy to prioritize them during the fiscal period. On the other hand, four sectors (Security and Rule of Law, Transparency and Accountability, Energy and environment and Industry and Commerce

Sectors) experienced reduction in their allocations.

FY2016/17FY2018/19 Approved Budget by Sector.

The allocation for Use of Goods and Services for FY2018/19 is US$97.6 million amounting to 17.1 percent of approved budget of US$570.1 million. This shows a 39.5 percent decrease when compared with FY2016/17 allocation of US$161.3 million and a 21.2 decrease when compared to the FY2017/18 allocation of US$123.8 million.

The reduction in Use of Goods and Services signifies National Government efforts in redirecting funding to Public Sector Investment Projects (PSIPs) for the successful implementation of the Pro-Poor Agenda for Prosperity and Development (PADP).

The FY2018/19 budget for both Consumption of Fixed Capital and Interest and Other Charges are zeroes compared with US$26.8 million and 10.8 million in FY2016/17 and US$1.6 million and US$2.9 million in FY2017/18 respectively. It implies a 100 percent decrease for both categories of expenditure for FY2018/19.

This is the result of series of austerity measures being implemented by Government e.g.: the freeze on the purchase of vehicles by ministries and agencies to create the fiscal space for spending in PSIPs.

Also, allocations for Interest and Other Charges for Domestic and Foreign Liabilities have been imbedded with the respective payable principal amounts.

Further, the FY2018/19 approved allocation for Subsidies and Grants are US$2.4 million and US$54.8 million respectively, which accounts for 0.4 percent and 9.6 percent respectively of the overall FY2018/19 approved budget.

The budget for Subsidies experienced a 96.6 percent decrease in FY2018/19 compared with FY2016/17 and a 16.4 percent decrease compared with FY2017/18.

The approved budget for Grants in FY2018/19 is US$54.8 million (9.6 percent),while the approved budget for Grants in FY2016/17 and FY2017/18 was US$1.5 million (0.3 percent) and US$63.5 million (11.8 percent) respectively.

This implies that Grants experienced a sharp increase of 3553.3 percent in FY2018/19 compared with FY2016/17 budget and reduced moderately by 13.6 percent compared with FY2017/18, he report noted.

In the same vein, the allocations for Social Benefits and Non-Financial Assets for FY2018/19 are US$1.2 million and US$64.4 million respectively. This represents 0.2 percent and 11.3 percent respectively of the overall yearly allocation of US$570.1 million.

This indicates a 47.1 percent and 482.7 percent increases for both categories of expenditure when compared with FY2017/18 budget of US$0.79 million and US$11.0 million. Increases in these expenditure categories in Quarter One of FY2018/19 can partly be attributed to reclassification of some expenditure lines.

Moreover, Domestic and Foreign Liabilities have a provision of US$6.7 million and US$23.2 million in the approved FY2018/19 budget which accounts for 1.2 percent and 4.1 percent of the approved budget. As mentioned above, the allocations include Interest and Other Charges.

This shows increases of 9.8 percent and 65.3 percent, respectively for the above mentioned expenditure categories when compared with FY2017/18 allocation of US$6.0 million and US$14.0 million, correspondingly.

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