ZIMBABWE’S government spent higher amounts funding operations of the Defence and War Veterans ministry during the first half of the year, compared to expenditures committed to crucial sectors, such as health care, data released by the Ministry of Finance revealed yesterday.
Expenditure patterns released during Finance minister Mthuli Ncube’s Mid-Term Budget Review indicated that money deployed to defence dwarfed funds channelled towards combating the deadly Covid-19 pandemic, which has claimed 3 340 lives among 103 567 confirmed cases since last year.
This confirmed concerns of the ruling Zanu PF government’s skewed priorities — spending more on the security forces and civil service.
In the budget review, Ncube reviewed his 2021 growth targets to 7,8% from 7,4% and projected annual inflation to fall to 30% from about 330% in December 2020.
This was despite price hikes and currency depreciation that has affected spending power and productive sectors in the past few months.
Prices rocketed by a staggering 40% in June after a Statutory Instrument punishing transgressions in foreign currency use came into force.
The data showed that the Defence and War Veterans ministry had already expended ZW$14,5 billion (US$169,4 million) during the first half of the year, which represents 61% of its annual vote totalling ZW$23,8 billion (US$278 million).
In contrast, the Ministry of Health and Child Care spent ZW$9,4 billion (US$109,8 million) during the same period, out of the ZW$54 billion (US$630,8 million) 2021 budget allocation.
The Defence and War Veterans ministry expenditure was way above the national average of expenditures.
The Office of the President and Cabinet, whose annual budget is ZW$14,2 billion (US$165,8 million), had utilised ZW$8 billion (US$93,4 million) during the first half of the year, which is just ZW$4 billion (US$46,7 million) below the ZW$9,4 billion (US$109,8 million) spent on health and child care during the same period.
Recurrent expenditure, mostly in the form of civil service wages, which gobbled up to 97% of the budget during former Finance minister Patrick Chinamasa’s tenure at the helm of Treasury in 2013, has continued to bleed the economy.
In his statement yesterday, Ncube said the 2021 National Budget provided ZW$172,6 billion (US$2,01 billion) for compensation of employees alone, inclusive of pensions, premised on an average cost of living review of 70% from the 2020 levels during the period January to June.
“Cumulative expenditure for the first half amounted to ZW$80 billion (US$934,5 million) against a cumulative target of ZW$73,8 billion (US$862,1 million),” the minister said.
“Compensation of employees at 40% of total expenditures constitute the largest share of total expenditure. The over expenditure of ZW$6,2 billion (US$72,4 million) is on account of hiring of additional personnel for critical posts in the education sector following recruitment of 3 000 teachers in January and filling of the already approved 4 713 health sector posts in response to the Covid-19 pandemic,” Ncube said.
He said these expenditures were also on account of cost of living adjustments effected in February and April 2021.
“As a result, during the period under review, an average of 41% of total budget was expended against a half year target of 45%,” he added.
Ncube said the government spent ZW$12,1 billion (US$141,3 million) during the first half of the year towards input support programmes for the vulnerable households and wheat farming for the 2020/21 agriculture season.
The Finance minister said revenues for the period January to June 2021 are estimated at ZW$198,2 billion (US$2,3 billion) whilst expenditures amounted to ZW$197,6 billion (US$2,3 billion) to give a budget surplus of ZW$570 million (US$6,65 million).
This performance benefitted from both tax and non-tax revenues, which were above targets by 5,3% and 392%, respectively. — Staff Writer.