Government has spent a total of KR2.5 billion on fuel subsidies alone while the cost of maize subsidies has increased by 2,400 percent since the introduction of subsidies in 2009, Finance Minister Alexander Chikwanda has disclosed.
Mr. Chikwanda said government has in the past years been spending huge sums of money subsidizing the two commodities at the expense of pro-poor and tangible development programmes.
In a statement to ZANIS in Lusaka today, Mr. Chikwanda substantiate government’s decision to remove subsidies on maize and fuel saying the two were misdirected as they diverted resources from high priority areas.
He said there was need to analyze the high cost associated with the two subsidies to determine whether they could have been channeled to more important and beneficial programmes such as education, health and sanitation and social protection.
He said fazing-out subsidies on maize and fuel will benefit the poor people as it will free up resources for other economically and socially beneficial activities.
Mr. Chikwanda explained that on a comparative basis, the KR6.1 billion used on subsidies between 2010 and 2012 exceeds the budgetary allocation of KR4.5 billion to the Ministry of Health for the same period.
He noted that it was important for the nation to acknowledge that any subsidy provided by government implies redirecting resources from the provision of other goods and services.
He explained that before the subsidies were removed, they were worsening inequality in social warfare and perpetrating social injustice as they were only favouring the urban community which was not the most poor and vulnerable.
“Going forward, government is convinced that the subsidies were very inefficient because they hardly reached the intended beneficiaries nor provided the platform to lift the poor out of the poverty trap,” Mr. Chikwanda said.
Meanwhile, the Finance Minister maintained that government will continue to subsidise agricultural farming inputs, primary and university education and the public welfare assistance programmes.
Mr. Chikwanda noted that given the challenges and vulnerability that viable farmers face in accessing agricultural inputs and financing, government has decided to continue supporting 9,000 farmers through the Farmers Input Support Programme (FISP).
He further said apart from primary education, government will continue subsidising university education where public universities are charging below cost-reflective market fees with government meeting the difference.
He has since called on all citizens and friend of Zambia to support the Patriotic Front (PF) government in its effort to transform the economy and uphold strong economic growth in a sustainable manner.
Recently, government removed financial backing on fuel and maize, a situation that sparked mixed feelings among Zambians with some students, some civil society organizations and the church appealing to government to rescind its decision.
ZANIS
Well said.It doesn`t take a rocket scientist to figure out that this is good for the nation.Way to go.
If the Hon. Minister also clarify how much present Government is spending in incentives to non-qualifying ZDA investors it will be useful to asses his Ministry performance.
Thats our money from us and for us. So if it was spent on us its okey. After all PF will never end poverty in Zambia (THATS A TRUE FACT)
Good move PF. Now reduce on number of deputy ministers and useless poaching of opposition MPs.
Like Kabimba would say these days ,Chikwanda hasnt provided some empirical data of his so called spending on susidies.What he is saying is therefore not reliable .This is government of greedy thieves ruling hungry people.
PLEASE CAN YOU TELL THE NATION THE TOTAL WAGE BILL (WITH ALLOWANCES) OF YOUR DEPUTY MINISTERS ONLY AND THE TOTAL AMOUNT SPENT ON BYE ELECTIONS SO FAR?
THEN YOU CAN TELL US THE CRAP “Chikwanda explained that on a comparative basis, the KR6.1 billion used on subsidies between 2010 and 2012 exceeds the budgetary allocation of KR4.5 billion to the Ministry of Health for the same period.”
NO BWANA MINISTER YOU DON’T CARE ABOUT HEALTH .ALL YOU CARE FOR IS FILLING YOUR POCKETS AT THE EXPENSE OF THE POOR ZAMBIANS.
My friend the amount that goes for allowances for Ministers and by-elections is less than 10% of the savings to be realised from the removal of subsidies. Stop politiking the govenment means well.
Ati “Channeled to more important and beneficial programs” and “hardly reached the intended beneficiaries”. Which are beneficial programs and intended beneficiaries other than corruptly and selectively applied areas and people. Hasn’t the President and countless Ministers openly said they will only develop areas that have PF MPs?
All these “saved” resources will go to Mchingha to serve their kinsmen. We ve already seen the accelerated levels of development in Mchinga, Northern, Luapula and Chongwe Provinces, even without the removal of subsidies.
He should also tell the total bill as at this month spent on ministers, PRESIDO, DIPLOMATES ETC TRAVELLING ALL OVER THE WORLD INCLUDING THAT OD DR KASEBA
We said ba Minister. WHoever doesn’t see the logic in what PF has done is damn right dull.
Subsidies on food are part of the health bill. A malnourished nation can never be healthy neither can it be properly educated. The PF’s selective condemnation of subsidies policy is disgusting. Can Chikwanda justify the 800 litres of fuel subsidies he is getting per month from taxpayers? Neither UNIP nor MMD had such a policy. Stop preaching Austerity to the rest of the nation while you and your family swim in taxpayer funded high life! You cannot be living in a PF socialist paradise while the rest of the population is subjected to robber capitalism.
Do you have to look at everything with blurred vision, it’s tedious!
@ichalobantu, why do you bother? Truth is constant macaca! I am not PF and I don’t tell lies!
My friend the amount that goes for allowances for Ministers and by-elections is less than 10% of the savings to be realised from the removal of subsidies. Stop politiking the govenment means well.
Public Savings have to be made across the board. Politicians don’t need to pay themselves like private company Directors just because what they pay themselves is very little compared to the entire public purse. No one deserves 800 litres of free fuel on the public purse! This is criminal. Chikwanda can afford to buy his own fuel from the public salary he receives! Stop justifying public theft!
KR6.1 billion used on subsidies between 2010 and 2012 that is a 3 year period but equals to expenditure on 1 by election and the money the ministers out to explain the removal of subsidies will spend. As a layman KR2 billion per year spent on subsidies is not bad at all! Not a significant yearly saving if that is what will accrue after removal of subsidies