The 2012/13 national budget is a calling to everyone, especially those in government to speak and walk the austerity talk, and realize that time for hyper-expenditure is beneath the country, the Centre for Human Rights and Rehabilitation (CHRR) and the Centre for Development of People (CEDEP) have said.
The two organizations also asked the PP led government to be accountable and transparent.
“Now is the time to account for every single penny. It’s time to go back to work for the interest of our country,” they said in a joint statement released on Sunday by CHRR Executive Director Undule Mwakasungula and CEDEP Executive Director Gift Trapence.
Malawi’s Finance Minister Dr. Ken Lipenga presented the national budget to parliament on 8th June 2012.
In his almost one-hour-ten-minutes presentation, Lipenga said the budget is designed to address serious economic challenges and put the country onto a path of sustained recovery.
He said emphasis will be placed on enhancing sustainability of growth and development through policies that consolidate macro-economic stability, reinforce resilience to shocks, improve governance in public and financial management, strengthen financial oversight, and support private sector-led growth and crop diversification.
“For sure…adherence to these virtues should be the way to go. Otherwise, the proof of pudding is in the eating and government’s capacity to see the economy through these austerity measures will
depend…on its ability to spend prudently as well as root out corruption and mismanaged of public resources in all its departments and leadership,” reads the statement in part.
CHRR and CEDEP also welcomed the removal of taxes on some essential items such as newspapers and internet services.
They noted that access to information is a constitutional right saying government only risked depriving its own citizens of this right by imposing VAT on newspapers and internet services.
They also lauded government for the inclusion of safety net packages meant to cushion the poorest of the poor from the hardship occasioned by devaluation.
“Though there is a hazy picture on how far these packages will go in helping those below poverty levels. It is also difficult not to wax lyrical about the government’s intention to priorities food security through expansion of the number of Farm Input Fertilizer Subsidy (Fisp) beneficiaries to 1.5 million from 1.2 million while maintaining the MK500 as the bag price for the input,” they said.
Civil Servants salary hike
CHRR and CEDEP noted that the civil servants’ 21 percent salary hike is quite an improvement from last year’s 7.5 percent but cautioned that it is far from being in tune with the scale of the cost of
living that came with the recent 49 percent kwacha devaluation.
“All along, the civil servants through the Malawi Congress of Trade Union (MCTU) have been advocating for a 67 percent salary increase to meet the rising cost of living. Thus, one finds 21 percent increment a mockery—a move that would leave most of the low-paid workers with
grimaced faces,” they observed.
The two organizations said not even the increase of zero threshold for Pay as You Earn (PAYE) from MK12 000 to MK15 000 will save them from the hardship.
“It is, thus, CHRR and CEDEP’s imploration on the MPs that the salary increment be adjusted to about 30 percent, with the zero-tax threshold be moved from MK15 000 to around MK25, 000,” they said.
Subsidies on Fuel and Electricity
They said government’s move to scrap subsidies on the two is worrying bearing in mind the fact that the country’s citizens are reeling from skyrocketing prices of the same, especially fuel whose prices have been so volatile.
“This will as well continue to affect the rural masses that also depend on fuel to transport their local produce. With weak monitoring and control mechanism this will make the prices rise again though
prices have already doubled recently,” said CHRR and CEDEP.