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Government to cut on donor dependency
By
Our Reporter - 03-06-2002 |
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Unreliable donor inflows have forced the government to largely depend on dome-stically generated resources, President Bakili Muluzi has said.
Muluzi, who was speaking at the opening of this year’s budget session of parliament in Lilongwe, said “given that donor inflows have lately become unreliable, govern-ment will need to depend more and more on domestically generated resources,”
He told the House that the government would also institute strict expenditure control measures to ensure that ministries and government departments operate within their budgets.
The measures, he said, include cutting down internal and external travel, strict control on the use of government vehicles and penalties for controlling officers who do not adhere to the budgetary control measures.
“Additionally, government has decided not to have this year’s National Day Celebrations that would cost K34 million,” said the president in his two hour 15 minute state-of-the nation address.
The president said that the 2001/2002 fiscal year had a lot of fiscal pressures and macroeconomic problems resulting in minimal real gross domestic product (GDP) rate.
Although inflation has declined, he added, interest rates remain very high, thereby stifling the private sector.
“Government will, there-fore, continue to implement tight fiscal and monetary policies aimed at reducing inflation and lowering interest rates so as to create a conducive macroeconomic environment for private sector participation,” said the president.
To avoid over expenditure, the problem that has been recurrent in public sector over the years, the Ministry of Finance has been mandated to scrutinise proposed budget submissions.
The president said that the 2002/2003 budget would increase allocation to agriculture, education, health, water and sanitation and rural feeder roads because they have direct impact on poverty reduction.
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