Lately, there have been statements by senior government officials commenting on the state of debt levels in the country. The comments have partly been assurances that the current debt stock is sustainable.
Various sections of society have expressed fears that the country’s debt stock is increasing to levels that may become unsustainable. While the government has made several assurances that the nation’s debt levels are within manageable limits, it is important that the government is seen to contract and manage debt in ways that do not potentially worsen the livelihoods of the majority poor.
If debt being contracted is not prudently invested on high return projects to enable debt repayment without compromising social sector spending, then debt contraction even in the current sustainable debt levels is a source of concern. Increasing debt levels now also imply higher future taxes on the already heavily taxed workers and consequently a higher cost of living.
The cost of living for the month of January 2014 as measured by the JCTR’s Basic Needs Basket for an average family of five living in Lusaka stood at K 3,605.01. This shows an increase of K66.47 compared to the month of December 2013 when the basic needs basket stood at K3, 538.54.The increase in the basic needs basket is mainly due to the rise in the cost of Kapenta. Overall, there has been a significant increase of K40.50 in the price of Kapenta from K69.71 to K110.21 per Kilogramme in December 2013 and January 2014, respectively. This signifies an increase of about 58%. The leap in the price of Kapenta may be attributed to the fishing ban. Considering that majority of the households consume this food item, this significant rise in the price can negatively affect household food security. The price of beef has also showed a slight increase of about K3.
That a considerable rise in the cost of basic needs has been recorded at the beginning of the implementation of the 2014 budget is cause for concern. This is in consideration of the fact that government is likely to borrow more given parliament’s approval to increase the borrowing threshold from K20 Billion to K35 Billion.
Increased borrowing, especially domestically, during the course of implementing the 2014 budget will not only further increase the national debt stock but also potentially increase inflation which may burden the already struggling poor households.
Therefore, caution must be taken to ensure that debt levels do not skyrocket. Care must be taken to ensure that first and foremost the 2014 budget is managed within the already high projected deficit level of 6.5% of GDP to avoid financing deficit through debt contraction. Further, the JCTR urges the government to manage any such deficit, which may arise, in such a way that the majority poor’s ability to afford basic necessities is not worsened than it already is.
JCTR BASIC NEEDS BASKET: LUSAKA
January 2014
(A) COST OF BASIC FOOD ITEMS FOR A FAMILY OF FIVE IN LUSAKA
| Commodity | Kwacha | Quantity | Total | Kwacha |
|---|---|---|---|---|
| Mealie Meal (breakfast) | 69.00 | 2 x 25Kgs | 138.00 | |
| Beans | 18.33 | 3 Kgs | 54.99 | |
| Kapenta (dry) | 110.21 | 2 Kgs | 220.42 | |
| Bream (dry) | 69.69 | 1Kgs | 69.69 | |
| Beef, mixed cut | 30.71 | 4 Kgs | 122.84 | |
| Dark green vegetable | 2.83 | 4 Kgs | 11.32 | |
| Tomatoes | 4.99 | 4 Kgs | 19.96 | |
| Onion, large | 4.61 | 2 Kgs | 9.22 | |
| Cooking oil (2.5 Ltrs) | 32.86 | 3 litres | 39.43 | |
| Bread wheat, refined floor, baked | 4.70 | 1 loaf/day | 141.00 | |
| Sugar | 15.76 | 6 Kgs | 47.28 | |
| Milk (fresh) | 4.73 | 4x500ml | 18.92 | |
| Tea, powder (250g) | 11.11 | 1 Kgs | 44.44 | |
| Eggs | 9.14 | 2 Units | 18.28 | |
| Salt | 3.68 | 1Kgs | 3.68 | |
| Sub Total | 959.47 |
(B) COST OF ESSENTIAL NON-FOOD ITEMS
| Charcoal (90Kg bags) | 125.00 | 180 Kgs | 250.00 | |
|---|---|---|---|---|
| Soap (Lifebuoy/Champion) | 3.41 | 10 Tablets | 34.10 | |
| Wash soap (Boom) | 4.74 | 4x400g | 18.96 | |
| Jelly (e.g. Vaseline) | 10.48 | 1x500ml | 10.48 | |
| Electricity (med. density – fixed) | 372.00 | 372.00 | ||
| Water & Sanitation (med. cost – fixed) | 210.00 | 210.00 | ||
| Housing (med. density – 3 bedroom) | 1,750.00 | 1,750.00 | ||
| Sub Total | 2,645.54 | |||
| Total for Basic Needs Basket | 3,605.01 |
| Totals from previous months | Dec 12 | Jan 13 | Feb 13 | Mar 13 | Apr 13 | May 13 | Jun 13 | Jul 13 | Aug 13 | Sep 13 | Oct 13 | Nov 13 | Dec 13 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Amount (K) | 3,532.10 | 3,469.68 | 3,645.44 | 3,616.18 | 3,593.60 | 3,625.20 | 3,684.46 | 3,638.42 | 3,581.13 | 3,536.69 | 3,575.37 | 3,557.81 | 3,538.54 |
(C) SOME OTHER ADDITIONAL COSTS
| Item | Kwacha | Item | Kwacha | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Education | Transport (bus fare round trip) | ||||||||||
| Grades 8-9 (User + PTA/year) | K400.00 – K600.00 | Chilenje-Town | K9.00 | ||||||||
| Grades 10-12 (User + PTA/year) | K650.00 – K1, 300.00 | Chelstone -Town | K9.60 | ||||||||
| School Uniform (grades 8-12) | K90.00 – K200.00 | Matero-Town | K8.40 | ||||||||
| Health (clinic) | Fuel (cost at the pump) | ||||||||||
| Registration (book) | K3.00 – K5.00 | Petrol (per litre) | K9.91 | ||||||||
| Self referral (Emergency Fee) | K 5.500 | Diesel (per litre) | K9.20 | ||||||||
| Mosquito Net (private) | K30.00 – K120.00 | Paraffin (per litre) | K6.83 |
(D) A COMPARISON OF COSTS (in Kwacha) OF BASIC NEEDS ACROSS ZAMBIA IN JANUARY
| Lusaka | Kasama | Mansa | Mongu | Ndola | Solwezi | Monze | Chipata | Mpika | Luanshya | Kitwe | Kabwe | Livingstone |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 3,605.01 | 2,276.68 | 2,247.85 | 1,985.94 | 2,889.81 | 3,053.03 | 2,211.73 | 2,197.32 | 1,563.20 | 2,158.93 | 2,405.04 | 2,518.74 | 2,708.99 |
This is exactly what is obtaining in our homes meanwhile our incomes are so limited because we have to pay rent as well. This government is slowly murdering its own people by making life unbearable. The cost of living is ever rising and yet we have a president who goes to gallivant elsewhere and he starts telling us lies that he is wooing investors. He even left our plane parked somewhere else. How reckless can a president be honestly? This is a man who has no clue of income and expenditure. He just wants to spend regardless of where the money he wants to spend is coming from. We are already spending so much money on his medical bills when he said he would ban sending people outside for treatment. He promised to equip our hospitals with modern facilities. Now look at what is happening lies
Ndipo ni nkhani yo limba iyi. This is one of the countries with relative peace and the saddest people who can not go out, have fun without feeling the pinch of high cost of a good time.
There is more to come than what you are experiencing at the moment. This is just the tip of the iceberg. Pronouncements and reality are two diferent things so I would urge every well meaning Zambian to tighten their belts because life will tougher than before in the near future.
good progress. When it reaches 5,000 let me know
Imwe do you mean a family of 5 can eat 2kgs of beans for one month? tomato 4 kgs ? what are you talking about ? You meant one day or something else…. really
The report is not well articulated. I was expecting a comparison with a minimum pay for a lowly paid Civil Servant. The report sounds more political than anything else!
Zambians should learn to live the choices they make. You chose sata so put up with his non sense or shut up!
There is no cost for airtime
and recreation/holiday
and bear
I like the analysis, i was particularly interested in the amount for rent or housing….i can say K1 750 can only get one a two bedroomed house not 3. Lusaka accomodation is very expensive..k3000, k3500 is what one needs to pay for a decent accom…its tricky
Where is the Challenger please and who is using it in the name of the President ? Furthermore, is it constitutional ?