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{
    "id": 105429,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/105429/?format=api",
    "text_counter": 314,
    "type": "speech",
    "speaker_name": "Mr. Mbau",
    "speaker_title": "",
    "speaker": {
        "id": 182,
        "legal_name": "Elias Peter Mbau",
        "slug": "elias-mbau"
    },
    "content": "On macro-economic assumptions underpinning the medium term, the Committee observed that the Budget Policy statement seems to assume that the variables of economic growth, that is inflation, money supply, interest rates and rates of exchange will automatically converge to policy without indicating the underlying risks and externalities such as population growth, whose figures we do not as yet have, and climate change. There is also no mention of the figures in the Budget Policy Statement, yet they are key determinants, as we know, in the distribution of the resources available. On the Budget Framework for 2010/2011 Financial Year, the Committee observed that the proposed revenue collection may need further administrative measures to achieve targets. On the side of expenditures, the Committee observed that the underlying macro-economic strategy and policy on expenditure is weak, since a huge chunk of the funds goes to recurrent expenditure, currently at the level of 97.4 per cent. This has the result of making projections into the future, and, in particular, development becomes unrealistic and misleading. So, there is need for a strong revenue base, a policy and a firm expenditure framework that can be relied upon and sustained as the country moves forward. On the deficit financing and public debt, the Committee was able to learn that the Budget Policy Statement does not identify that more efforts and measures will be required to reduce the debt, and in particular the domestic debt. The Committee supports the principle of reducing this public debt; it continues to make current planners happy but at the expense of future generations. However, we are concerned that some of the important expenditures which may cause distress in the framework, including implications of the new constitutional dispensation, had not been included in the Budget Policy Statement. However, the item on the constitution referendum was catered for yesterday when this House passed the Supplementary Estimates. This country certainly needs a coherent fiscal financing strategy for predictability, and this is not explicit in the Budget Policy Statement. We need a clear policy on debt sustainability in future as a minimum requirement."
}