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Alba Iulia
Thursday, October 22, 2020

Minister of Finance Unveils a K119.6 Billion Proposed 2021 National Budget

Headlines Minister of Finance Unveils a K119.6 Billion Proposed 2021 National Budget

Finance Minister Bwalya Ng’andu has unveiled a K119 billion proposed National Budget for 2021 aimed at laying a foundation for economic recovery, safeguarding livelihoods and protecting the vulnerable in society in light of the COVID-19 pandemic.

The usual pomp and splendor that characterizes budget presentation was missing today when Dr Ng’andu arrived at the National Assembly building at 13:58 hours in the company of his wife and daughter to present the country’s proposed budget.

The ceremonial events were suspended as the country observes the COVID-19 health guidelines following the outbreak of the pandemic which has claimed many lives world over.

Dr Ngandu presented a K119.6 billion proposed 2021 national budget representing 32.6 percent of the Gross Domestic Product (GDP), which is more than the K106 billion 2020 National Budget.

Of this amount, K68 billion, representing 18.5 percent of GDP will come from domestic revenues and grants, while the balance of K51.6 billion will be raised through domestic and external financing.

Delivering the 2021 budget presentation, Dr Ng’andu said government has developed a medium term Economic Recovery Programme as a successor to the Economic Stabilization and Growth Programme of 2019.

He said the Economic Recovery Programme provides incentives to reinvigorate growth and build resilience and safeguard livelihoods and protect the vulnerable in society as well as restore debt sustainability.

Dr Ngandu said the 2021 budget will now be output based as opposed to activity based budgeting in order to promote performance and enhance transparency and accountability.

The Minister of Finance has since raised the exemption threshold for Pay-As-You Earn to K4, 000 from K3, 300 per month in order to increase disposable income of employees.

The minister has further given relief to differently abled persons by increasing tax credit to K500 from K250 and has also increased deduction by an employer for employing a person with disability to K2, 000 from K1, 000.

He has also increased the allocation towards dismantling of arrears to K2.3 billion in 2020 from K437 million in 2019.

Further, Dr Ng’andu said Government will reduce borrowing from the domestic market to 1.1 percent of GDP from 1.4 percent of GDP in 2019.

He said government is resolved to restore fiscal health and has projected fiscal deficit to reduce to 9.3 percent of GDP in 2021 from 11.7 percent in 2019.

Dr Ng’andu has since proposed to spend K57.8 billion for general public services with K18.3 billion being for domestic debt servicing and K27.7 billion for external debt obligations.

The minister has further allocated K1.2 billion for the Local Government Equalisation Fund and K598.1 million for the 2021 General Elections.

Dr Ngandu said government has provided K2.8 billion to dismantling arrears owed to suppliers of goods and services in order to improve liquidity and stimulate economic activity.

He said government has allocated K5.7 billion for the Farmer Input Support Programme (FISP) to reach out to 1 million farmers and a further K517.5 million for the national strategic food reserve in order to make the country food secure.

The minister said government will spend K567.3 million to complete the Kenneth Kaunda and Simon Mwansa Kapwepwe International Airports while K6.2 billon will be spent on ongoing road infrastructure projects.

Dr Ngandu said K13.8 billion has been allocated to the education sector in order to improve it with K7.1 billion for early childhood and primary education, K2.7 billion for secondary education and K1.9 billion for tertiary education.

The health sector has been allocated K9.7 billion with K3.2 billion for primary health care while K5.1 billion for hospital services.

He said K1.4 billion from the budget for primary health care will go towards the procurement of essential drugs and medical supplies.

Dr Ngandu said a further K4.8 billion has been allocated to mitigate the impact of Covid 19 and enhance social protection with K2.3 billion for Social Cash Transfer and K1 billion for the Food Security Pack from K100 million.

Government has also provided K6.7 billion on Defence, Environmental Protection, Religion, Recreation and Culture while Housing and community amenities has been allocated K2.2 billion.

Dr Ngandu further said government has allocated K266.3 million for youth and women empowerment with K155.2 million specifically for youths.

He explained that the budgetary allocations for 2021 are based on priority areas as identified in the Economic Recovery Programme as aligned to the 7th National Development Plan.

31 COMMENTS

  1. The budget is becoming meaningless to the ordinary Zambians.

    It has just become a ritual ceremony of presenting budgets which are never adhered to under this ineot government corrupt man called Edgar Lungu.

    Zambia needs activity based budgeting system where every activity must be evaluated based on importance and availability of resources.

    PF must go!

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  2. We thank you our very able minister. This is a great budget encompassing all critical areas of our economy. We have even had some upnd members risking their lives by supporting this budget. This shows just how patriotic this budget is. Putting people first irrespective of region, tribe, political affiliation and other myriad of factors. Amen

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  3. Congrats PF; congrats MoF for a successful 2021 budget presentation. I can’t wait for a PF 2022 budget.
    Powerful pro-poor and indeed the budgetary allocations based on priority areas as identified in the Economic Recovery Programme as aligned to the 7th National Development Plan.
    Let’s roll folks. We got this.
    U5s can’t understand!

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  4. WHAT IS SHOCKING IS THAT THE BUDGET IS ONLY ABOUT SIX (6) BILLION US DOLLARS AT 20 KWACHA per DOLLAR. THE ECONOMY IS JUST TOO SMALL. THIS IS PATHETIC.
    WE NEED TO DO SOMETHING. WHAT HAVE WE BEEN DOING SINCE 1964?
    SOMETHING IS VERY WRONG
    NO WONDER WE ARE REFERRED TO AS ONE OF THE POOREST COUNTRIES IN THE WORLD!
    WAKE UP ZAMBIA!
    WE NEED A NEW ECONOMIC MODEL LIKE YESTERDAY PEOPLE.
    WE HAVE THE RESOURCES BUT THEY ARE NOT BEING HARNESSED FOR THE GREATER GOOD AND THIS IS NOT ABOUT THE PF BUT ALL ZAMBIANS AND hh IS NOT THE SOLUTION AND WE KNOW WHY.

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  5. WHAT IS SHOCKING IS THAT THE BUDGET IS ONLY ABOUT SIX (6) BILLION US DOLLARS AT 20 KWACHA per DOLLAR. THE ECONOMY IS JUST TOO SMALL. THIS IS PATHETIC.
    WE NEED TO DO SOMETHING. WHAT HAVE WE BEEN DOING SINCE 1964?
    SOMETHING IS VERY Wrong!!
    NO WONDER WE ARE REFERRED TO AS ONE OF THE POOREST COUNTRIES IN THE WORLD!
    WAKE UP ZAMBIA!
    WE NEED A NEW ECONOMIC MODEL LIKE YESTERDAY PEOPLE.
    WE HAVE THE RESOURCES BUT THEY ARE NOT BEING HARNESSED FOR THE GREATER GOOD AND THIS IS NOT ABOUT THE PF BUT ALL ZAMBIANS AND hh IS NOT THE SOLUTION AND WE KNOW WHY.

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  6. THE GDP OF, ZAMBIA IS ABOUT 20 BILLION US DOLLARS AND YET JEFF BEZOS THE WORLD’S RICHEST MAN IS WORTH ABOUT 200 BILLION US DOLLARS.
    ZAMBIANS HOW IS THIS POSSIBLE. WHERE HAVE WE BEEN?
    WITH ALL THE RESOURCES IN ZAMBIA BEZOS IS WORTH MORE THAN OUR COUNTRY.
    LET US WAKE UP.
    AND hh IS NOT THE SOLUTION
    A NEW ECONOMIC MODEL IS THE ANSWER

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  7. Shocking how we can be battling as little as 12 billion dollars debt which is pocket change for Bill Gates. How can one man be richer than our entire country with all the minerals we have in Zambia. Something is amiss here. Coming to revenue how the hell are employees contributing more than the companies they work for in taxes.

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  8. Not only is the crucial issue on the way these funds are spent in practice, (with diversions, missing ‘receipts’ etc.) but also on this statement;
    “Of this amount, K68 billion, representing 18.5 percent of GDP will come from domestic revenues and grants, while the balance of K51.6 billion will be raised through domestic and external financing” A proposal, with expectations. What about the 1.8 billion of the 10 billion stimulus package, what is the exact source? Bearing in mind it appeared after the previous governor was fired.
    567 million to complete the airports. Too late of course to abandon this project, but in the current climate, it looks like a drain of resources – added to the previous argument that I made that the KK airport, for example, only needed a revamp at a fraction…

  9. Only about $6 billion dollar budget. I cannot blame the minister of finance. I blame the government and us people for lack of knowledge how to tap into the abundance of natural resources we boast about. It is true we have abundance of resources. We need to elect leaders who think beyond academic or head knowledge. Zambians should work very hard in every job including cleaning and nursing the old. All jobs should be respected. No wonder Zambia is poor because every Jim and Mary want an office job.

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  10. Budgeting without budget discipline is no budgeting at all. That’s where we are in Zambia. I’m reading the budget speech just to know the new depth in deception to which we hv plunged as a nation.

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  11. It’s really most shameful that we’ll over half a century afternoon independence a country, any country, of a population of almost 20 million would have a debt of US$20 billion and budget of a mere US$20 billion. This is horrific, this govt of the Bembas by the Bembas for the Bembas is a total failure!

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  12. We intend to pay interest and un specified principle idebt. At the same time, we shall borrow 2 billion dollars. Meaning we are now relying on debt cancellation. We have no intention to pay back. Meanwhile our GDP is 365 billion kwacha. Each person should produce an averages of k20000 worth of goods and services. Take the challenge.

  13. The Budget has two sides to it.The Minister only spoke of Total Expenditures but doesn’t telli us where Revenue will come from. The Economy with Covid-19 Restrictions is not performing well and Revenue Collection is definitively going to decline. The future looks bleak with Elections in 2021.

  14. I beg to be educated on how an output based budget works! Does it mean for example after 50 houses for police have been built that’s when the cost gets determined and then the budget line gets credited? Just what is output based budgeting?

  15. This is definitely a good budget. It can’t get better than this. PF has once again set an example how a welfare budget should be! Great job!

  16. The budget, with all its provisions has come at such a crucial time, when people needed all these reliefs the most. The budget will have far reaching impact on elevation of standard of living in Zambia.

  17. The government has presented the best budget it could, in the current situation. Owing to the Covid19 pandemic, the budget couldn’t get better. The concern for people and determination for economic revival reflects in the budget.

  18. 2021 budget will now be output based as opposed to activity based budgeting in order to promote performance and enhance transparency and accountability – great step Mr Finance Minister. Mor power to you!

  19. I can’t thank enough for the revolutionary provision of Pay-As-You Ear! This will improve spending power of common man of Zambia.

  20. Increase in tax credit for differently abled persons from K250 to K500 will bring never before benefits to them. They can look forward to get jobs also, as deductions for employers has been increased to K2000 from K1000. Only a visionary government can come up with such revolutionary provisions.

  21. Incentives like provision of K2.8 billion to dismantling arrears owed to suppliers of goods and services in order to improve liquidity and stimulate economic activity, will encourage more and more individuals to contribute to national growth.

  22. With the hard work of farmers and K5.7 billion provision for the Farmer Input Support Programme (FISP) and K517.5 million for the national strategic food reserve will ensure food security of Zambia. The current pandemic is the classical example that highlights the need to be prepared for any eventuality. With this provision, the government has ensured that no one goes to sleep hungry.

  23. Dismantling arrears to local suppliers by piling up more debt amounts to nothing. Why this simple truth escapes some is beyond me. And who outside Zambia is going to lend money to the zambian government? If it’s possible, how affordable will the money be?

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