THE government yesterday presented a $700 billion supplementary budget which analyst said was meant to finance government’s lavish spending. The additional amount brings the total budget for
the year to $1,442 trillion.
Half the supplementary budget will finance government’s bloated wage bill following hefty salary increases awarded to civil servants in July.
“A sum of $311 billion is needed to meet additional cost of the job evaluation,” Finance minister Herbert Murerwa told parliament yesterday.
Murerwa avoided key issues of interest rates and galloping inflation which analysts forecast will reach 1 000% by the end of the year.
“The additional spending will result in a budget deficit of $301 billion (7,3% of GDP) against the original $230 billion (11,5%) announced in November last year,” said Murerwa.
MDC shadow Finance minister Tendai Biti said the budget was criminal and a seal of approval for government’s profligacy.
“It’s a criminal budget that is meant to legimatise government’s fiscal indiscipline,” said Biti. “They have found a proper way to strip state assets before their exit,” said Biti.
Murerwa said nothing about the low interest rate which have discouraged savings and fuelled speculative consumer spending.
“Domestic debt will definitely skyrocket as borrowing has become the major source of funds for a government facing imminent collapse,” said Biti yesterday.
An economic analyst with a local bank said the budget was the hallmark of poor governance.
“As long as Murerwa said nothing about interest rates and inflation his budget is a disaster. The budget will push inflation further up,” he said.