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Saturday, June 6, 2020

Finance Minister Alexander Chikwanda admits to budget deficit

Headlines Finance Minister Alexander Chikwanda admits to budget deficit

Finance Minister Alexander Chikwnda is flanked by Secretary to the Treasury Fredson Yamba (left) and Bank of Zambia Governor Michael Gondwe (right) at a media breakfast at Taj-Pamodzi hotel in Lusaka
Finance Minister Alexander Chikwnda is flanked by Secretary to the
Treasury Fredson Yamba (left) and Bank of Zambia Governor Michael
Gondwe (right) at a media breakfast at Taj-Pamodzi hotel in Lusaka

Finance Minister Alexander Chikwanda has for the first time admitted that the PF government has a deficit on its 2013 national budget.

Without specifying the actual value of the deficit, Mr. Chikwanda told a media briefing Sunday morning that the deficit was as a result of unbudgeted expenditure.

Several stakeholders have been arguing that Zambia was in a budget deficit situation with some claiming that the budget role runs in the region of K5 billion.

“Yes there is a budget deficit but deficits are normal. It happens everywhere and there is nothing strange about it but what it is important is the measures that the treasury will devise to cut the deficit,” Mr Chikwanda said.

He attributed the deficit to a multiplicity of factors such as the huge expenditure on maize purchases by the Food Reserve Agency and the oil import bill before the subsidies on fuel were removed.

“The huge increment in public service wages which comes into effect in September has also contributed,” said Mr Chikwanda.

“The global economic situation has not been very favourable, this has posed a challenge to us on the revenue side. Our projections have not matched our financing requirements.”

Mr. Chikwanda however vehemently denied that the cost of financing bye elections has contributed to the fiscal challenges.

“Bye elections are budgeted for and they are constitutional. We have not over spent on bye elections.”

He added that government will keep a tight grip on borrowing despite the budget deficit.

“We don’t want to over burden the future generations with unsustainable debt levels. Our debt to GDP ratio stands at around 5 percent so will don’t want to increase that further, we will only go to the bond market at an appropriate time.”

Mr. Chikwanda also revealed that he will soon be tabling the Medium Term Expenditure Framework in Parliament which will spell out details on how government will respond to the fiscal challenges in the short to medium term.

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93 COMMENTS

    • Are you okay sir?. Your father comes home and admits that he has spent all the money for food on other women and you in response begin to blame your mother’s ex-husband. Please regain you faculties.

    • @simonmfula
      iwe!! firstly before i say anything.. why do you look like a shadow of Dan pule?

      secondly go back to your books or just google what the transparent means,,, and your official PF spokesperson just issued denying the same deficit….
      And read the first paragraph this article…“Finance Minister Alexander Chikwanda has for the first time admitted that the PF government has a deficit on its 2013 national budget“. then you should understand that there is NO transparent here

    • “we will only go to the bond market at an appropriate time.”

      Ba Chikwanda what are you talking about. First Kaloba Euro-bond is not even 6 months old you are talking about going to the bond market again. Do you really understand how bad bond markets are? Tell the people of Zambia how much you are paying in interest rates alone per month and what Zambian assets will be lost if you default.

      No more borrowing, you and your Uncle should just retire, Kabimba the other day said we should not be using recycled politicians.

    • Budgets are drawn from programmes of action, which are PLANS. A failed budget is evidence of poor or no plan at all. Now I believe HH… PF is full of Ba “Chimbwi no …..”

      Then he says “… BYE elections are budgeted for…”. So, if 10 PF MPs defect to other parties tomorrow Mr Chikwanda would have had already provided for this unforseen event better than the purchase of maize by FRA? …. Can’t 2016 come earlier to save us from this mess I wonder?

    • Sata is a Kaponya, only knows how to spend but not make money. This is the proem with having these old rugs who only know how to get bribes when in government but cannot run there own businesses.

      This explains why these old rugs never want to retire from Politics. It’s now time for all these Old Rugs to pack up and go!!

    • @1.2 Ndobo, hahahaha yaba, I was sad because of football, but you make laugh for remind me of Danny Pule!!
      Leave Simon alone, he just arrived in Belarus. Mwandi Simon Mfula, people are not voting you down because of your Nyimbash comment, but your outfit. Is that not MMD’s blue, na tu white strip??

  1. To be fair, I don’t think Rupiah Banda had ever heard of the term deficit. At least these guys have a credible finance minister.

    • You actually use your ars.e to think instead of your head!! lol!
      Unlike Ukwa who has no formal education, RB holds a Degree in Economist – so who doesnt know anything about Budget Deficit?
      Secondly, we never heard the term Budget Deficit in RB’s term because the Economy was so well managed that we were only hearing the term Budget Surplus because RB employed competent people like Musokotwane, Fundanga, etc to run the economy.
      Compare this to people like Chikwanda, and the inexperienced current BOZ Governor – we are back into deficits for may years to many years. Thanks to so many senseless new Districts! Monkey no plan!

    • Ba Mukame, MMD left a surplus in the govt coffers and PF has blown all that. Then Magande was Finance minister and Dr Fundanga was BoZ governor. Compare and contrast what is obtaining now. A proliferation of unplanned projects hoping that will endear the PF to the people has been a whole mark of the PF regime combined with massive corruption. Unfortunately, all they have managed, with their bloated government is to expose their lack of experience and lack of a coherent plan. All those election lies have proven what some of us have always said, that the emperor has always had no clothes. We have always wished the people of Zambia the best, but the current leadership is incapable and totally out of their depth.

  2. There’s something terribly wrong with these fools in govt. I thought Shamenda came out and blasted Nawakwi as frustrated and failed politician, just fell short to call her a b*t-h! Do these fools talk to each other before the answer to the media.
    These guys are so disappointing and embarrassing!

    • Nawakwi is a politician who was playing politics-it is up to us the informed to separate politics from the substance.Deficits are normal especially in times like these when copper prices are depressed and receipts are falling -so govt should just help people to understand and let politicians do what they do

    • Yes one wonders as to whether they share notes for their behavior is like people shouting and making all sorts of uncoordinated moves when attacked by an army of red ants

    • Rocks——What you have said is totally missing to be grasped by PF president, ministers and supporters of this failed government.

  3. @sosharocks you are spot on. ba shamenda insulted mama nawakwi yesterday when she disclosed this. Ba chikwanda should not down play this as it is a huge problem. it is good pf are admitting now that they are trigger happy on spending and by elections are certainly a factor here especially that they are now losing . they will think twice before inducing more by elections. but what this means, is that chikwanda is a very weak finance minister.

  4. Did I read somewhere that an Acting Chief Government Spokesperson was calling Edith Nawakwi a frustrated and failed Politician for bring the deficit to our attention?

    Or am I just hallucinating or on something illegal? Or has Chikwanda’s just lost his marbles for ignoring what the Government Spokesperson said.

    Anyway with all the BIG three on Finance in the PF Government, am bound to believe what has been said today. May Sakeni come back soon to free Shamenda from the spokesperson torture he is going through. He is really doing a lousy job.

    • @MMD chief bootlicker
      Reality is finally setting in for PF…

      Its like being a irrespossible Father who was busy `drinking off ` and spending his budget on mahule believing that fika isova. Then the landlord comes knocking for his money and school children want school fees plus other expenses

    • Bootlicker though we are at opposite poles of the political spectrum, I do concur with you on this one!! I used to think my hearing was bad, BUT NOW I BELIEVE WHAT I WAS HEARING: “MORE HOLES IN YOUR POCKETS!!!”

    • @MMD Chief Booklicker, did you hear that former Finance Deputy Minister, Miles Sampa has vowed to keep quiet for 30 days after ECZ disagreed with his figures that KR 4 million was budgeted for by-elections with another KR 46 million obtainable from contigency funds? He was saying that only KR 17 million had been spent up to the Feira by-election but ECZ said that just for the 3 elections that weekend KR 17.3 million had been spent. Obviously suffering embarrassment Sampa decided to zip his mouth. Check his facebook page.

  5. PF is not worried about the deficit. It is big enough to take care of itself. Its just one of those children of Sata from unwed mothers. Next we will hear the president say, “the defisit is the new inspector general of police for Muchinga province, jobs that are reserved for b*stard kids.

  6. The one thing consistency about the PF govt is inconsistency. Shamenda says one thing, Chikwanda on the other side says exactly the opposite. That’s Paya Farmer(PF) for you!

  7. Let the Minister deny that deficit for first quarter of 2013 was not above K3.4 billion (as per their first quarter review report) and for second quarter it is expected to be over K6 billion and we still have 6 months to go.

  8. Chileshe kandeta the Finance Ministry spokesperson and Musonda of the Judiciary have one thing in common!! Guess??

  9. And what was the budget deficit under MMD? Did it also exist, or were people too busy chewing to discuss the issue?

  10. BUFI AGAIN!!

    Lets all together sing this song: 1, 2, 3 together, GO: Abakalamba kale bale tubepa, (ubufi) ati: mukolwe pakulila aleme baka ee, nomba natukula nefwe natu imwena, kokoliko teme baka eeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeee!!

  11. Song birds have predictable life span,the louder they sing the shorter is the life. The circus continues in PAYA FARMER.

  12. Hon Chikwanda,how come you are not highlighting credible ways on how yo finance team plans to deal with this deficit??…Admitting the deficit is one thing and offerring solutions is another.People like me want solutions,so pliz give us solutions so we can debate on them.Thank you.

  13. Shame on foolish politicians like Sha “water” Shamenda also abbreviated as SHAME. He castigated Nwakwi who talked abt budget deficit. Politicians need to be sincere wen speaking on governance issues and not to politic.

  14. 1. Commission of inquiries

    2.Fruitless Districts

    3.Overhaul of foreign service

    4. Bye elections.

    5.Over pricing road construction projects.

    6. Judge chikopa.

    • x. over-blotted govt

      xi. The “kulibonesha taa” donation of fuel to one neighboring country

      xii. Another “anione anione” donation of maize to yet another neighbour

      xiii. Building of MY “retirement house”

      xiiii. Needless huge expenditure on hiring Chinese to block The Watchdog to silence critisms

  15. I wish the minister had also reminded us of how much deficit was budgeted for this fiscal year, as far as I know running into deficit is not unusual.

    • Its not unusual but….also operating in the same economic environment like Singapore or Chile and coming out far behind these star performers speaks ill of us.Thats the worst type of unusual.

  16. Shamenda is the one who is a failed Politician, infact he is not one. Us who stayed with him in Ndola know that he would gone made or died due pverty if Sata did not pick him and recycle the fellow. This the more reason he says things he does not know to try and stay long in the Govt. Those who care to know must go and see how plunders reourcse at Workers Compnsation Fund Control Board everytime he is in Ndola on his private visits.

  17. Can we finally have peace? Let us redefine our understanding of peace. Most of the violent conflicts in Africa have happened against a background of years of misrule, cronyism, leadership deficit, and human right abuses. These conducts are threats to peace. Scholars have long concluded that peace is a practice of justice. It is not the result of entertaining a hodgepodge of ragtag POLITICIANS who specialize in oppression, repression, and suppression of the population. This has now gone on for too long already, until we take appropriate actions, the monsters we have created will continue to haunt us. This needs to change!

  18. This minister has lost control of the Budget and is saying irrelevant things that would even make the likes of Bond Holders, IMF, World Bank, etc worried.
    How can this Orangun tell us that the Budget Overrun is partly due to Wage Increament Bill – BUT the increament is only due to come in Sept!! This is impossible because the increaments have not yet been effected. So how can they lead to budget overspend today (August)?
    Secondly, he says Budget overruns are normal! What nonsense is this? He is justifying failure instead of finding solutions! Those holding our Bonds must be ready not to be re-paid!
    Why is he not giving us the list of the unbudgeted projects – politically created New Districts, etc.
    This OLD thing Chikanda is a total failure – Where is Magand

  19. GDP is not GRZ income so we should try to live within our means otherwise we shall be poverty stricken for generations.Companies with a good balance sheet have closed down why? Because of liquidity!

  20. We started a long time ago compiling a list of all these PF maggots who need to be dealt with locally and at The Hague. Chikwanda definitely has not been omitted. He is inflicting pain on citizens by allowing useless expenditures when he has the jurisdiction to ensure that resources are applied reasonably to the benefit of the poor majority Zambians.

  21. I guess its bye elections and the creation of un budgeted for districts, i hope a lesson has been learnt.

    • By election have nothing to do with this as they are budget for….. what you should be concerned with is the unanticipated expenditures that arose in 2013 such as wage increments which were beyond the budgeted levels, expenditure related to recruitment of staff and construction of centres in Sata’s newly created districts, construction of new roads and the hosting of the UNWTO conference.

  22. Chikwanda has LAMENTABLY FAILED, make way for fresh blood….when are these guys going to stop treating us like kids.

    • At the many forum, I have interacted with Chikwanda, he is either half asleep or sleeping throughout.

      This OLD RUG IS TIRED. Let’s just change Government altogether.

  23. This explains why we need all OLD RUGS OUT. They only know how to spend but not make money.

    How with such a bloated government, and Dunderhead for Cabinet Ministers, lead by a aStandard 2 (Grade 4), dropout. Let’s start advocating for CHANGE of Government NOW.

  24. The economy and justice haves become an object to toe with by the PF government. They have taken the economy to the toilet through their careless expending and corruption.

  25. The economy and justice have become objects to toe with by the PF government. They have taken the economy to the toilet through their careless spending and corruption. We have seen , they don’t care about UTH that is why they are all going to India as medical tourists for illnesses that can be managed in Zambia. The rule of law book has been put through UKWA’s shredder and the law has been left at the mess of Kabimba. The courts are now issuing statements .

  26. What do you expect, when you put kids in a caddy shop. This exactly what’s has happened with PF. They created districts , employed hundreds of their cronies, increased the minimum wage , ministers stay in high end apartments, and the list goes on.

    The time for reckoning has come and WE the people of the UNEMPLOYED PARTY will have to change the government again. I was mistaken , I always thought PF would last one term- looks like they will out before the end of the term!!

  27. exactly what I said in my post yesterday in reference to Kandeta thatha statement should come from Finance minister or from govt spokesman..I dont know where Kandeta sits now.

  28. The PF has really lost it, really, even an imaginative woman like Nawakwi can figure you out?

  29. Chikwanda is the only person in PF who will say the truth, remember last time he advised Bob Sichinga not to comment on matters he does not understand, this is the same issue with Shamenda, he doesn’t know and understand the financial aspects of govt hence his comments! I hope Shamenda will apologize to Nawakwi for calling her names!

  30. In all this, what is becoming apparent is that the cabinet does not meet regularly to address and preside over the countries issues. The disjointed statements issued by various ministers and deputy ministers all point to incoherent policies and all signing from different hymn books. One day a spokesman from the min of Finance disputes the existence of budget deficit, another day a deputy minister at min of Commerce says by-elections were budgeted for, all this confirms that there are no discussions whenever a cabinet meeting is held (whenever the president is fit enough that is). However, what does on in there is not a debate, its a time when the president issues decrees and orders on what he wants done and no one questions the decrees, everyone then plays hocus pocus to fit the orders…

  31. This speaks ill of our management of our economy and budget.We have deficits but the fact that were now far behind Singapore who were the same level as us in the 60’s should really wake us up.A deficit of performance hurts more than a mere budget deficit.

  32. I saw this coming. The civil servants will see nothing in September. No salary increments for them. The govt has no money. Wait until January next year.
    Too bad.

  33. Some times some of the things which happen in this country really shocks me. Ba pf be careful. Father bwalya just launched his party yesterday. 2o16 kuya bebele.

  34. Those who have access to the Yellow book, please check out the 2013 approved budget figures under which by-elections fall and compare with the accumulated expenditure on by-elections in 2013. It helps a lot when we talk facts. That way our criticism of govt will be productive as it will be mutually beneficial.

    • What matters is that MMD with a K13.5 Billion budget in 2011 did more than what PF has done with two bloated budgets of K27.5 Billion and K32.2 Billion. We should demand Chikwanda to account for this discrepancy. User fees in schools went up 48% from 2011 to 2012, farm input support dropped from 8 to 4 bags from 2011 to 2011 even 2013. For 2013 the PF govt will need, not a supplementary but, a complimentary budget of not less than K20 Billion.

      Within three years of his term in office, RB grew our reserve account by US$1.6 Billion even when the budget totals for that term was less than half of PF’s budgets for their two years in power. Chikwanda and his team, as well as family members have formed hundreds of companies and it’s these companies constructing roads etc

    • and they are sub-contracting Chinese companies. It’s really more money in their own pockets. The foolish youths who voted are to blame for this mess.

  35. It was already crystal clear that PF govt was losing control of the economy and this is another attestation. Lies by Shamenda surely had short legs and they have been swallowed by these self confessions by Chikwanda. Nawakwi was right after all!!!

  36. ohhhh…twalingana naba MMD they also went through this deficit issues by overspending ku RDA that made all directors Fired

  37. The consequences of govt expendture is to ultmately inject income in circulation.Consequently ths yields growth on GDP & income status thru direct finance to the mases.Contrary to theortical declaration of middle income status direct finance has a direct impact on socio-economic status.The end result is empowerement- in the long run.

  38. The deficit must be huge. Politicians do not easily admit their wrong or their embarrassing side to save their face, but if they finally admit, then know that it’s so huge and serious impossible to be hidden anymore.

  39. pf played donch kubeba. and for sure they will never tell u the truth. for this one the have admitted because they know that later the truth will show.

  40. Time is such a constant thing and it remains true again, Bufi Govt has started showing its true colours of ubufi. This is a govt which does not understand the bigger picture of things, yet first borrow and start thinking of what to do with the money, then realize they are in a deficient and start thinking of borrowing. In the mean time they are busy spending outside their capacity to generate the revenue. Now what will be the impact of increasing the govt wage bill? It will be the mark of beginning of hyper inflation, what a UNIP style of governance.

  41. At least uncle Chikwanda is being truthful but I wish he could retire and stop dragging our name in the mud.

  42. What defence do the mindless PF supporters have against all these accusations? Scarface Chikwanda was as good dead and buried before the nostalgic Sata resurrected him and made him finance minister. He has lost contact with his night school econimics. Sata’s standard five education has put the nation into jeopardy. The man is one hundred times worse than RB. Cry The Beloved Country.

  43. Budget Deficit is a phenominon that a pf regime shud not smile about, because it’s fiscal sin committed by pf financial mismanagement. The first time in history civil servants will not be paid. It’s a lie maize buying and fuel cannot and do not cause budget deficits these are planned for activities and financialy viable. Pf induced by elections corruption and embbezzlements cause budget deficits.

  44. Pf induced by elections are extra ordinary many wat is budgeted for is ecz salaries in fact how do u budget for unseen it’s a lie!

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