THE government’s claims that it managed to maintain a positive balance on its Reserve Bank of Zimbabwe (RBZ) account and cut down on expenditure are misleading and should be regarded with sus
picion, economic commentator John Robertson has said.
Robertson said government had managed to maintain a positive balance on its account because it had not paid Value Added Tax (Vat) refunds to local companies for the past six months.
He said it was “not true” that government had a positive balance on its expenditure.
“They have a positive balance because they are not paying their debt. They have not paid billions in Vat refunds,” said Robertson this week.
“Anyone can have a positive cashflow if they are not paying their debts.”
Government recently announced that it had cut down on expenditure as part of its inflation-reduction strategy.
The Treasury department in the Ministry of Finance and Economic Development also said government had managed to maintain a positive balance on the accounts as part of efforts to reduce expenditure.
This, Robertson said, was not “honest in its assessment” of the situation on the ground. He pointed out that there was still a massive budget deficit which government was deliberately down-playing to boost their claims of controlled expenditure.
“(Acting Finance minister) Herbert Murerwa’s fiscal policy states clearly that there is a budget deficit of $830 billion. If there is any surplus then it is billions that have not been paid to local companies,” he said.
“They (government) continue to live beyond their means. Their expenditure remains high. How can they have a positive balance? It’s misleading.”
Government continues to fund its bloated expenditure through borrowing.
Vat refund delays have seen the government maintaining a positive balance on its central bank reserve account. The positive balance account is also an accumulation of billions of dollars that government and the Zimbabwe Revenue Authority (Zimra) have not paid to exporting companies, Robertson said.
The government owes more than $25 billion in outstanding refunds to bakers.