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Sunday, April 18, 2021

Meagre budget provisions for the poor and marginalised decried

Civic society and economists have expressed reservations on the 2021 national budget saying while it provided some tax relief, that cushion was not enough to help ordinary persons given Poverty Datum Line that remain high.

They also noted that Finance and Economic Development Minister Profesor Mthuli Ncube was not courageous enough to identify few areas to provide funding in a significant way than a “spirit of appeasement” where he tried to allocate money to every sector which had no impact.

Zimbabwe Coalition on Debt and Development executive director, Janet Zhou said while Minister Ncube had evenly allocated money to every sector to enable it to recover from the effects of Covid-19, the money was too little for it to transform the lives of ordinary people.

“The Minister covered all sectors that we were looking at, we were looking at unlocking Government spending towards Covid-19 so we saw allocation on social safety nets, health, youth, women, people with disability in terms of post Covid-19 recovery because of the shocks. But I think he was not brave enough in terms of giving more to the people, the resources ended up being spread too thinly,” said Ms Zhou.

“He looked at venture capital fund, sovereign wealth fund, financial inclusion and I think these are good tenets of a budget. He talked of prudence in debt management, public management system and I think these are key issues that he raised. He has made quite significant commitments in the national budget that we will need to continue follow through as civil society”

On devolution, Ms Zhou said there was need to provide funding to provinces so that they could come up with their own Gross Domestic Product.

“On the issue of expanded tax free threshold, Government gave out with one hand and took away with another hand. The majority of people will not enjoy the expanded tax free benefits because of the burden of taxes,” she said.

Renowned economist noted that Minister Ncube had limited fiscal space to move.

“It is a Catch 22 situation. The Minister wants to be generous by raising salaries but at the same time raise inflation rate. Tax free threshold of $10 000 might not be of significance when Poverty Datum Line is pegged at around $20 000,” he said.

He said there was need for a vibrant commodity exchange rate modelled along the tobacco sales.

 Confederation of Zimbabwe Industries economist Ms Tafadzwa Bandama said the economy still suffered from low aggregate demand.

Harare Residents Trust executive director, Mr Precious Shumba said the national budget ought to have addressed areas social protection and vulnerable members of society.

He said there was need for Government to release more funding on devolution in fulfilment of the country’s constitution.

“We are however pleased with the upward review of that money, but we also need to say the Minister ought to be bold enough to prioritise social services. It is not prudent to make provision for the security sector,” he said.

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