News Column

Financial Discipline Must Be Strictly Observed

June 23, 2014



THE National Assembly is later today expected to endorse the government's budget proposals for the 2014/15 financial year, after a week-long spirited debate on the estimates.

Through a roll-call voting, Members of Parliament (MPs) will be required to declare their individual positions on the 19.85tri/- government budget moved by the Minister for Finance, Ms Saada Mkuya Salum, in the House on June 12.

It is expected that some opposition MPs will reject the budget proposals to register their disapproval on various issues including the national debt, tax management, financial discipline, public spending and budgetary allocation in general.

The government has, however, already admitted the challenges it is facing in financing its operations and various development programmes forcing it to resort to local and external borrowing in response to budgetary deficits. The domestic source of loans included borrowing from commercial banks, treasury bills and bonds, while externally it had relied on grants and loans.

The minister told the House that in 2014/15 the government will continue to mobilise grants and concessional loans to implement the budget. She pointed out that the government planned to borrow 1.3tri/- (about 800 million US dollars) from external markets on non-concessional terms to finance strategic development projects.

Various commentators within and outside the National Assembly have roundly blamed the government for what has been described as 'borrowing spree' in the last two years, saying that the trend may push the nation back to the highly indebted poor country (HIPC) status.

The government and other local authorities have repeatedly been coming out in defence of the Treasury, saying the debt is still sustainable. Experts are, however, cautious and insist on prudent utilisation of the loans for intended purposes such as financing strategic infrastructure development projects.

It is therefore hoped that the borrowed monies will finance projects like construction of roads, expansion of ports and rehabilitation of railway network.

It will be absurd for the government to borrow and spend the monies on salaries, allowances and luxurious items like 4X4 vehicles for its executives.

The role of MPs should therefore not end today at the roll-call voting in the Parliament chamber, but they must strictly monitor implementation of the budget.

The MPs should see to it that the government's budgetary pledges including slashing of tax exemptions, casting of the taxman's net wider and prudent spending are delivered on without failure.


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Source: AllAfrica


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