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Finance Minister Friday Jumbe said on Thursday a half-year review of the budget has discovered that some votes in the budget have over spent and that the bill on interest rates has also gone up.
Jumbe made the admission in interview on the sidelines of a signing ceremony of an agreement between the government of Malawi and Norway regarding institutional cooperation between the national audit office and the Swedish National Audit Office.
He was asked to disclose findings of the budget review exercise that takes place about six month after the enactment of the budget by the National Assembly.
“Some votes have overspent while others have under spent. That is normal,” said Jumbe without disclosing the reasons for the developments saying he will bring them up in his speech when he presents his extra budget on March 15, 2004.
Jumbe said there has also been over expenditure on interest rates bill.
“We thought that interest rates would go down to between 29 to 30 percent. But as we are speaking now they stand at about 35 percent,” said Jumbe. “ Since we also pay interest on domestic borrowing, the bill on interests rate has gone higher.”
He did not give figures.
Jumbe noted that although revenue collection had been satisfactory over the period under review, delay of donor inflows has not been helpful.
“We thought that donor inflows would start coming around July. But they only started flowing in around end October after the IMF agreed to our programme. This affected us,” he said.
On why he was not publishing the expenditure reports as he had promised, Jumbe said there was nothing guarded about it.
“I have no problem publishing the returns. They have indeed not been published in the media, we post them on the website. May be we have not put them in the papers looking at the clientele, to say who will want to use them. But there is no secret about it,” said Jumbe.
Asked why he did not conduct consultations prior to his extra budget as the case is with the main budget, Jumbe said it was not necessary.
“The consultations are meant to get feedback. The supplementary budget is just looking at some economic factors that have changed between the time the budget was passed and now, and how they have impacted on it,” he said.
The Economics Association of Malawi (Ecama) on Thursday asked for more time to make its comment.
The agreement, signed by Jumbe and Norwegian Minister of International Development Hilde Johnson, includes a grant amounting to 15.2 million Norwegian Kroner (approximately K240 million) to be used for 3 years to assist the National Audit Office implement its audit plan.
Johnson, in her remarks, called on the Malawi Government to carry out macroeconomic reforms and ensure public finance management which, she noted, is still below expectation.
“We also hope to see Corrupt Practice Act passed by the Malawi National Assembly. Fight against corruption is key to Malawi’s poverty reduction strategy, because corruption steals from the poor,” she said.
Asked in an interview to comment on Johnson remarks, Jumbe conceded the importance of a climate that wins confidence from the public and donors.
“Which is why we are also asking them to assist us put our house like we intend to do with the National Audit Office,” he said.
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