By Staff Reporter
Seasoned economist Gift Mugano has trashed Mthuli Ncube’s budget which was presented last week arguing that it lacks consistency adding that there is no guarantee that it will be the same by the end of December 2020.
Minister Ncube had promised a ZW$29 billion budget for 2020 but a few weeks later ended up tabling an astronomical ZW$58 billion budget.
These kinds of changes, according to Mugano will make it difficult to monitor the budget because it is moving and being changed at will.
“Ironically the pre-budget Strategy Paper for 2020 was anticipating a budget of ZW$29 billion but right now the budget has been changed within a month or so to ZW$58billion so what guarantee is there that when we reach December 2020 it will be ZW$58 billion.
“We are having a budget which is a moving target, so what are we monitoring, this is the issue of consistency because in consistency you have to repeat what you are saying over and over again but our numbers are not repeating themselves they are changing.
“If we can’t see the outlook for the next month then we change the numbers, we double them what is the guarantee that we will see the outlook for 12months, it means we are sitting here and we are having numbers and we are saying it’s the future, but there is no future,” he said during a 2020 post-budget seminar.
Issues of constantly changing policies are not new to Zimbabwe and it has been identified as one of the bottlenecks that have stood between the country and the badly needed investors.
Just a few weeks ago, Reserve Bank of Zimbabwe (RBZ) governor John Mangudya clashed with Minister Ncube on the introduction of a new currency and new notes.
These consistencies have forced potential investors to take a wait and see approach on the country when it desperately trying to move forward economically from past challenges.
According to Mugano, inconsistencies are also visible especially on the issue of growth rate adding that “this is the same thing with the 2019 budget, we are anticipating inflation to be 5% by December, but right now as we speak it’s 100 times that target, there is no consistency, and these are the numbers.
“When you look at again the growth rate, Ministry of Finance was targeting 3.1 positive growth rate, IMF was targeting 3.1 negative growth rate, the number was the same the difference was on the sign and we stayed with this number and we planned with this number but then what happened we got now a recession of 6.5 percent and we are hearing numbers of 7.1 % and 10% percent negative by year-end.
“So it is very important as Parliament to have think-tanking when we are looking at these numbers to be able to question and say are we in the right direction because this table tells you a story that there is no guarantee that we are going to be moving in achieving our target,” he said
Meanwhile, speaking at the same meeting, Zimbabwe National Chamber of Commerce (ZNCC) chief executive officer Chris Mugaga said that even though Minister Mthuli spoke of moving away from austerity but the 2020 budget is closer to austerity.
“If you look at this budget, its closer to austerity than 2019 one, Minister is saying we are moving from austerity to prosperity but the moment you remove subsidies you are actually more moving into austerity, so to me this is a closer budget to austerity than 2019 one.
“The Minister spoke of removing subsidies, it’s not a walk in the park because you are talking about an average, for example, wheat 4000 per tonne for maize its 300 per tonne and if you look at the total cost of that tonne you will see that subsidies were almost at 50 % of the total you remove it, which means food inflation is a reality in 2020 we have to accept it,” he said.-