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Non-projection of mining revenue reflects govt’s failure - Simuusa

Non-projection of mining revenue reflects govt’s failure - Simuusa
Written by Chiwoyu Sinyangwe and Fridah Zinyama
Thursday, October 15, 2009 5:56:50 PM

FINANCE minister Situmbeko Musokotwane’s non-announcement of the projected mining revenue for 2010 reflects a dismal failure by the government to manage Zambia’s main economic stay, PF chairman for mines Wilbur Simuusa has charged.

And the Economics Association of Zambia (EAZ) has observed that the implementation of the national budget will remain a challenge despite changes in its cycle.

During the presentation of the 2010 national budget, Dr Musokotwane did not announce the projected revenues from the mining sector, a shift from the custom that had become a tradition in the last few years.

The closest Dr Musokotwane came to was announcing that the sector was going to grow from 2.2 per cent this year to 13.7 per cent.

But Simuusa, who is Nchanga member of parliament said the ‘omission’ confirmed lack of direction of the government and that currently the country did know what it was doing in terms of mining policy and ministry of mines.

“This is evidenced by the fact that despite mining being the backbone of this country, nothing was said about the sector in the budget,” Simuusa said.

“It is an admission that things are not as good as they point them to be in the mining sector. The fact that we don’t know what the total revenue coming from the mines is, is a total failure on the part of the government because those mines are our resources as a country… go anywhere, Botswana, they have a proper grip on diamond revenues.

"You can get a report and see proper revenues of almost 50 per cent and they are doing by far better than us but we have got much more resources than Botswana. This is a dismal failure by the government to manage and extract the benefit from these resources for the Zambian people.”

Simuusa, a mining engineer, also charged that the failure by government to make revenue projection was borne in its quest to avoid being held accountable by the people.

“Since we are not bringing back windfall tax, applying the variable profit tax, he should have said ‘we are projecting so much revenue which is going to our coffers.’ And every month, we would be asking that how much have we collected…and by the end of the year,” he said.

“But the way I know this government, we are again playing hide and seek. They do not want to be held accountable to any of the high-sounding words about the mining sector.”

Simuusa said the failure by the government to improve revenue collection from the country’s lifeblood was going to compound spending on social services following the drastic reduction in overall treasury revenues owing to the effects of the global economic crisis.

And Dr Imakando, in an interview, said there were certain elements which government should have put in place to ensure that budget implementation was successful as a result of the changes that had been made in its presentation.

He however observed that government had managed to come up with a good budget despite the global financial crisis and other challenges that Zambia experienced.

“I would like to urge the Zambian public to take advantage of the good budget that has been presented. It was not easy, seeing as we were coming from a challenging year where we lost president [Levy Mwanawasa] and had to hold elections and then overcome the effects of the global financial crisis,” he said.

“I would therefore like to urge the Zambians to take full advantage of the good business climate that government has created.”

Dr Imakando said the year 2009 had a lot of uncertainties which the government tried to overcome in the 2010 national budget.

“This is why they have maintained the 2009 budget theme ‘Enhancing Growth through Competitiveness and Diversification’ because they know that they did not do enough...,” he said.

Dr Imakando said an admission of this nature showed that government was committed to ensuring that they made Zambia competitive while diversifying its economy.

And Dr Imakando said government should have increased funding to social sectors such as education and health.

The government has allocated K1.3 trillion to the health sector, representing a 25.3 per cent reduction from the allocation in the 2009 national budget while the education sector has been allocated K3.3 trillion. The reduction in funding to the health is as a result of a suspension in funding by some co-operating partners.

Labels: EAZ, MINING, MWILOLA IMAKANDO, TAXATION, WINDFALL TAX, WYLBUR SIMUUSA

posted by MrK @ 4:56 PM