zambia treasury brief on january to may budget performance

7/28/2019 Zambia Treasury Brief on January to May Budget Performance

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Page 1 MEDIA RELEASE - Treasury Information Brief

2013 Budget Performance www.mofnp.gov.zm Wednesday, Ju

Republic of Zambia

www.mofnp.gov.zm

TREASURY BRIEF ON JANUARY TO MAY BUDGET PERFORMANCELusaka, Tuesday, 25th June, 2013. The Government has raised KR10 billionin terms of tax, non-tax, and grant revenue for the period January to May2013, while expenditure for the same period totaled KR12.8 billion.

Speaking on issuance of the latest treasury information brief, Secretary to theTreasury Fredson Yamba said the difference between revenue and expenditurewas bridged by domestic borrowing through Government bonds and treasurybills, within the levels approved by Parliament for the 2013 budget.

This outturn, against an approved budget of KR32.2 billion, represented anexecution rate of 41.5 percent by end May 2013, he said.

Of the releases made over the period, 42 percent went toward facilitatingstatutory and contractual obligations such as debt service and the payment ofsalaries and wages in order to facilitate service delivery. The balance of thereleases, or 58.5 percent, enabled the provision of goods and services through

the various Government departments. These included KR257 billion whichwent toward payments to retirees under the Public Service Pension Fund,KR1.6 billion for the construction and rehabilitation of road and railinfrastructure, KR365.8 billion for electricity distribution and KR106 billion for

the facilitation of affordable credit to Small and Medium Enterprises (SMEs).

Mr. Yamba has said the performance of the 2013 budget has been impressive,dispelling rumours that it has degenerated into an over-run.

From January to May 2013, Government only spent KR12.8 billion from theKR32.2 billion budget of which, first quarter [January to March] expenditureamounted to KR8.1 billion and in the last two months, an additional KR4.75billion has been spent, how then can there be an over-run, wondered Mr.

Yamba.

He also stated that Government expected to raise KR2.55 billion from taxesand non-taxes in April 2013 but receipts amounted to K2.61 billion due tohigher collections from Pay As You Earn (PAYE) and trade taxes. Revenues and

grants collected in May amounted to KR2.1 billion and were above theprojected target by KR131 million.


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Mr. Yamba noted that the treasury faced timing challenges in terms of revenueinflows and expenditure demands towards the end of the first quarter and thebeginning of the current quarter, particularly in facilitating the UNWTOactivities and the funding requirements for the Farmer Input SupportProgramme.

The Government projected to spend K2.63 billion to facilitate variousprogrammes and activities approved in the 2013 budget, but as at end April, atotal of K2.8 billion was funded, representing 7.3 Percent above target. Thehigher than programmed releases in April were occasioned by expenditurepressures, particularly for oil procurement. Under constitutional and statutoryexpenditure, K847.2 million was spent on payment of salaries, wages andemoluments for constitutional office holders in April, 2013. K120.3 million wasspent on domestic debt service related to Government bonds and TreasuryBills, while K100.9 million went towards external debt.

K1.75 billion was spent on operations and programmes in Ministries, Provincesand other Spending Agencies (MPSAs) of which K51.4 million was allocated topensions. Other notable expenditure in April included K164.20 million for roadconstruction and maintenance, K48 million for the Constituency DevelopmentFund (CDF), K18 million for compensation and awards, and K6 million for

drafting of the Zambian Constitution. Incidentally, the K20 million budgeted in2013 for drafting the constitution has been exhausted.

The Treasury also facilitated several unbudgeted for activities during the monthof April 2013. These include K652.56 million to facilitate payments for fuelprocurement, K85.44 million for the UNWTO capital projects and K26.3 million

for seed suppliers arising from the re-planting exercise necessitated by thearmy worm attack in December 2012, and K6.24 million to cater for theshortfall for ZAWA.

The Secretary to the Treasury has said the domestic revenues in May 2013collected were above the programmed figure of KR1.89 billion by KR149 millionor 7.7 Percent.

Of these collections, tax revenue amounted to KR1.96 billion while non-taxrevenue was KR131.5 million respectively. Receipts from Cooperating Partnerscoming through the Treasury amounted to KR95 million, he said.

Government projected a total of KR1.87 billion to be collected as tax revenueduring the month of May, 2013 but the collections were above target by 4.8Percent. This was mainly due to good performance under trade taxes,corporate income tax and excise duties. Total income collections came toKR709.4 million, slightly below target by about 0.2 Percent due to under


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collection on PAYE. Trade taxes where above target by 27 Percent and exciseduties were above target by 13 Percent.At KR131.5 million, non-tax revenue collections for the month of May wereabove the target of KR71.2 million by KR59.5 million or 84%. Only KR1.95billion was released representing 19.9 Percent below the projected figure of

KR2.43 billion. The lower than programmed expenditure was consistent withthe revenue levels.

Under constitutional and statutory expenditure, a total of KR838.9 million wasspent on payment of salaries and wages including other salary relatedemoluments for public service workers as well as emoluments forconstitutional office holders. In terms of debt service payments, KR111.16million was spent on domestic debt, that is, Government bonds and TreasuryBills. No releases were made towards external debt as there was norequirement to do so.

Releases for operation and development programmes coordinated by Ministries,Provinces and other Spending Agencies amounted to KR998.9 million. KR330.9million was spent on transfers to Grant Aided Institutions such as the ZambiaRevenue Authority, Road Agencies and Universities.

In particular, it should be noted that approximately 60 percent of the funds inthe 2013 budget have been allocated to public service delivery especially in theareas of health, water and sanitation and education; the facilitation of servicedelivery at local government level; enhancement of productivity in theagriculture, tourism and manufacturing sectors; and provision of essentialinfrastructure such as roads and energy in order support growth in the focus

areas, he said.

I reiterate the Presidents guidance to continue focusing our budget executionon facilitating accelerated and sustained economic growth that translates intotangible realities for our people such as generation of sufficient and stable jobs,a redistribution of income and opportunities in favour of the poor, access tobasic services and a general improvement in the standards of living, said Mr.Yamba.

In implementing the budget, the Government has remained focused atensuring that the overall objectives of the budget are maintained. This, itshould be appreciated, is in the best interest of both the people, who are the

key stakeholders, and the Government, whose existence is for the overallbenefit of the people.

For the month of June, a total of KR2.56 billion is expected to be collected inrevenues and grants while expenditure is estimated at KR2.41 billion. Key

expenditure items for the month will include releases towards UNWTO


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activities, Farmer Input Support Programme, Procurement of Strategic FoodReserves and the Pensions Fund, disclosed the Secretary to the Treasury.

In terms of outlook, the Government projects to remain on course with theexecution of the 2013 budget as collections have been projected to over perform

by end of year. The projected higher collections, in addition, to the funds setaside under the contingency vote, are expected to cover, among otherrequirements, the higher wage adjustment for public service workers.

Mr. Yamba also pledged that in order to guarantee the execution ofprogrammes and activities, the Treasury will implement the Presidentsdirective of ensuring that programme implementation reports are submitted byMinistries, Provinces and other Spending Agencies (MPSAs) prior to receivingsubsequent funding.

Complimentary to the foregoing, the Ministry will intensify the issuance of

treasury information briefs in order to assist the public in monitoring andevaluating the implementation of the budget in a pragmatic manner.

Issued By:

Chileshe KandetaPublic Relations Officer

Ministry of Finance

zambia treasury brief on january to may budget performance

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