Edgar Lungu’s Speech was Empty Lies, Smoke and Mirrors – Nevers Mumba

Edgar Lungu opening Parliament on 18th September 2015

As Movement for Multiparty Democracy (MMD), our reaction to the speech by President Edgar Chagwa Lungu on the occasion of the opening of the Fifth session of the Eleventh National Assembly last Friday the 18th of September 2015 can be summed up in two words; empty lies.

President Lungu has no moral right to be making another set of big promises when the Patriotic Front (PF) government has miserably failed to fulfill their previous promises for which they have never apologised to Zambians who elected them. While some may accuse us of being unfairly harsh on the Republican President, we however believe this is a 100% accurate representation because the PF has zero credibility when it comes to fulfilling their promises.

The PF were elected in 2011 on a platform of lies and deceit with their “More money in your pockets” slogan which really meant “No money in your pockets” for the rest of us but more money in THEIR pockets. The last 4 years of their disastrous misrule has demonstrated their lies, corruption and incompetence beyond reasonable doubt and the speech by the president was unfortunately more of the same lies and empty promises.

It is clear that the whole speech was written for the president with little input from him and we are fairly certain he shall achieve very little of what he read because his heart and mind is not in it. We could clearly see things in it that were lifted from some of our statements in the recent past.

The actions of the President and the PF completely contradict their big public pronouncements. For example, the President said and I quote “We must transform ourselves by promoting cost effective operations in government to eliminate waste and abuse of public resources”. If the President believes in eliminating wastage of public resources, why has he created five new ministries at huge cost to taxpayers? Five new ministries are clearly not a priority under the current difficult economic circumstances where the government is running a huge widening budget deficit with ever reducing funding to line ministries.

Five new ministries means 5 new ministers with a settling in allowance of about K100,000 each and two brand new VX Landcruisers with a landed cost of over K1 million Kwacha each. We estimate that it will cost around K2.5 million per minister and K1.5 million per Deputy Minister just to set these people up before they have worked a single day, not to mention costs associated with Permanent Secretaries and Directors.

The 5 new ministries are obviously meant to be used to appoint opposition Members of Parliament in a feeble attempt to strengthen the PF and if the President appoints 2 Deputy Ministers per ministry, he will have 15 positions available. The total annual cost of maintaining a minister in salaries and allowances is K320,000 per year as per Statutory Instrument 92 of 2013 covering the Ministerial and Parliamentary Offices (Emoluments) Act. The figure is K303,000 for Deputy Ministers.

The total cost of just setting up these 15 new officials will be around K30 million before we add all the other costs of setting up a new ministry which include offices, furniture, vehicles, computers, new employees, security, etc. Adding in salaries for everyone and other running expenses for the next one year means hundreds of millions of Kwacha wasted just to create jobs and award corrupt contracts to PF supporters. The projected budget deficit of 7.7% of GDP by the IMF in 2015 is certain to be closer to 10%.

We estimate that each of the 5 new ministries shall cost K100 million to set up and run for a year, including settling in allowances for top officials and other incidental costs. K500 million can build:

a) 17 new boarding schools at K30 million each
b) 833 rural health centers at K600,000 each which is double the price it was when MMD was in power
c) 625 rural basic schools at K800,000 each

This is why we say the speech was empty lies. It is lies because how can President Lungu hope to achieve all the other things listed in his speech that include ambitious infrastructure programs when over 60% of the budget shall be spent on personal emoluments for his cadres and part of the rest lost in corrupt contracts also for his cadres?

He has demonstrated no ability to implement fiscal discipline but has recklessly continued the PF spending spree with more irrelevant expenditures such as numerous costly trips abroad and the reintroduction of Zambia Airways at a time when the vast majority of national airlines globally are making losses. The government has also wasted K10 million to re-create INDECO which adds no value to Zambia.

But Zambians are not stupid and they can see through President Lungu’s smoke and mirrors game.

In the entire speech, not once did the president address the highly volatile Kwacha to Dollar exchange rate to give practical solutions. The exchange rate has gone haywire because mining houses that account for 70% of foreign exchange earnings have lost confidence in the PF and are scaling back their operations and shelving new investments.

Blaming low copper prices or a global economic downturn is not tenable because prices of copper were much lower at different points during the MMD rule but we did not have the extreme problems we are currently experiencing. Moreover, the economy grew at an average of 6% during the 2007-2009 global financial crisis so the PF has no reasonable excuse for their poor results.

President Lungu failed to properly handle the load shedding issue. He talked about how he was affected because of a 5 minute blackout at Heroes Stadium. This is a mockery and an insult to Zambians who left their homes without power to go watch the match and returned home to find no power afterwards. He should apologise to Zambians for being insensitive to their plight.

President Lungu has made some very unrealistic projections on Zambia’s electricity capacity. He claimed that Zambia shall have surplus electricity in about a year which is simply unbelievable because we are in a power deficit that shall take years to be removed and new demand for electricity is coming online every year. The current PF plans to add new electricity capacity at Maamba and Itezhi-Tezhi and do minor upgrades at other plants are simply not enough to remove the current power deficit within a year from now. They do not factor in delays and budget overruns which always happen with PF.

We are very concerned at how casual the president was in his speech towards the debt. He claims we are within the acceptable international threshold of 40% of GDP but he ignores the fact that the weakening Kwacha which has depreciated by 100% in the last 4 years and is still depreciating means the real cost of repayments shall be higher because more Kwacha shall be required to buy Dollars to make the repayments.

The Zambian economy is slowing down which shall mean that the debt as a percentage of GDP may begin to rise to uncontrollable levels, especially as mining companies continue laying off people as has already happened at Baluba and Mopani mines and may happen at Lumwana mine. Therefore, any debt sustainability projections made by PF are worthless when the mines close down.

Zambians do not want to go back to the UNIP days of a $7 billion external debt which we are fast approaching. The PF are already scouting for the next $1 billion from where they shall siphon out money for elections next year and leave us all in huge national debts. Our total debt including local debt and debt owed to suppliers is around $10 billion, which is already 37% of the $27 billion estimated GDP for 2015. We are certainly crossing the 40% threshold when another $1 billion is added by PF this year and election pressures set in next year. They will do what they do best; get another kaloba.

President Lungu also failed to address the impending double digit inflation that is almost inevitable by next year. Prices of most commodities are already rising, partly due to the weakening of the Kwacha and reduced manufacturing capacity arising from electricity load shedding. President Lungu made no mention of any steps to deal with the inflation threat.

There are many false promises the president made in his speech which we cannot delve into for the sake of brevity, but Zambians can see through the lies and deception and are getting ready to boot out the PF in 2016. The corrupt incompetent PF government was a huge mistake to be elected and Zambians are ready to put things right by electing a new government that shall give them new hope and enable them improve their material living conditions.

Dr Nevers Sekwila Mumba
MMD President