- Version
- Download 0
- File Size 16.00 KB
- File Count 1
- Create Date December 14, 2021
- Last Updated December 14, 2021
SENATE HANSARD 14 DECEMBER 2021 VOL 31 NO 17
PARLIAMENT OF ZIMBABWE
Tuesday, 14th December, 2021
The Senate met at Half-past Two o’clock p.m.
PRAYERS
(THE HON. DEPUTY PRESIDENT OF SENATE in the Chair)
ANNOUNCEMENT BY THE HON. DEPUTY PRESIDENT OF SENATE
BILLS RECEIVED FROM THE NATIONAL ASSEMBLY
THE HON. DEPUTY PRESIDENT OF SENATE: I have to inform the Senate that I have received the following Bills from the National Assembly;
- Finance (2022) Bill [H. B. 16A, 2021]
- Appropriation (2022) Bill [H. B. 15, 2021]
MOTION
LEAVE TO MOVE FOR THE SUSPENSION OF STANDING ORDERS NO. 52, 65 (2) 134 AND 137
THE MINISTER OF FINANCE AND ECONOMIC DEVELOPMENT (HON. PROF. M. NCUBE): I seek leave of the Senate to move that the provisions of Standing Orders No. 52, 65 (2), 134 and 137 regarding the automatic adjournment of the Senate at five minutes to seven o’clock p.m. on sitting days other than a Friday and at twenty five minutes past one o’clock p.m. on Friday, Question Time and Private Members Motions taking precedence on Thursday, procedure in connection with Parliamentary Legal Committee and stages of Bills respectively, be suspended with effect from today and for the next series of sittings in respect of the following; Finance (2022) Bill [H. B. 16A, 2021], Appropriation (2022) Bill [H. B. 15, 2021] and other Government business.
The main reasons are to make sure that Senate can consider the Finance Bill deliberations in full and the approval thereof, and consider the Appropriation Bill to enable the well functioning of Government and the State in full followed by the debate and approval. I thank you
Motion put and agreed to.
MOTION
SUSPENSION OF STANDING ORDERS NO. 52, 65 (2), 134 AND 137
THE MINISTER OF FINANCE AND ECONOMIC DEVELOPMENT (HON. PROF. M. NCUBE): I move that the provisions of Standing Orders No. 52, 65 (2) 134 and 137 regarding the automatic adjournment of the Senate at five minutes to seven o’clock p.m. on sitting days other than a Friday and at twenty five minutes past one o’clock p.m. on Friday, Question Time and Private Members Motions taking precedence on Thursday, procedure in connection with Parliamentary Legal Committee and stages of Bills respectively be suspended with effect from today and for the next series of sittings in respect of the following; Finance (2022) Bill [H. B. 16A, 2021], Appropriation (2022) Bill [H. B. 15, 2021] and other Government business.
Motion put and agreed to.
MOTION
BUSINESS OF THE HOUSE
THE MINISTER OF FINANCE AND ECONOMIC DEVELOPMENT (HON. PROF. M. NCUBE): Mr. President, I move that the Second Reading of the Finance Bill, [H.B. 16, 2021] and Appropriation 2022 Bill, [H.B. 15, 2021] be inserted in today’s Order Paper as Orders of the Day, Numbers 1 and 2 respectively and the rest of the Orders being re-numbered accordingly.
THE HON. DEPUTY PRESIDENT OF SENATE: Why Minister?
HON. PROF. M. NCUBE: Mr. President, it is necessary that Members of Senate consider the measures that were put in place as a follow up to my Budget Statement; measures that will enhance productivity in the economy, measures that will enhance revenue collection, measures that will improve tax administration and environment of doing business, all designed to make sure that we raise enough resources to support the growth trajectory of our economy. I thank you.
Motion put and agreed to.
MOTION
FINANCE BILL [2022] [H. B. 16, 2021]
THE MINISTER OF FINANCE AND ECONOMIC DEVELOPMENT (HON. PROF. M. NCUBE): Mr. President, the Bill seeks to give effect to the revenue and tax measures that are announced through the 2022 National Budget Statement and delivered to this august House on 25th November, 2021. The measures seek to maintain fiscal stability through stimulating growth of productive sectors, enhance revenue collection, provide tax relief to tax payers, simplify tax administration, as well as improve the doing business environment.
I have also used the opportunity to amend the Acts that have a fiscal, financial and investment implication. The Bill provides for the following on income tax. In line with NDS1 thrust of protecting and providing equal opportunities to vulnerable groups, it will introduce an income tax credit of US$50 or local currency equivalent per month for every physically challenged person recruited by corporates. The credit will however be limited to a maximum of US$2,250 per year of assessment. It will adjust with effect from 1st January, 2022 the tax free threshold from ZWL10,000 to ZWL25,000 and the tax bands to end at ZWL500,000 above which a tax rate of 40% will apply. It will adjust the local currency tax free bonus threshold from ZWL25,000 to ZWL100,000, the foreign currency tax free bonus threshold from US$320 to US$700 with effect from 1 November, 2021. It will also preserve the value of retrenchment packages. It will also seek to adjust the tax exempt portion of a deceased estate from ZWL50,000 to US$100,000 or local currency equivalent thereof.
Mr. President, current legislation provides that if a company or entity is wound up voluntarily in circumstances that give rise to a reasonable suspicion that it has been deliberately put into liquidation to avoid any tax liability, the directors of the old company shall be jointly or severally liable to the amount of any tax due and payable by the old company and entity. However, in most circumstances, the beneficial owners of companies or entities are not revealed. Such circumstances justify piercing the corporate veil with a view to impose personal liability upon beneficial owners. There is a clause that seeks to compel tax payers filing returns of income for legal entities to disclose particulars of beneficial owners, thereby providing transparency and accountability in the conduct of business.
Mr. President, I will now turn to the issue of capital gains tax which is also enshrined in this proposed Finance Bill. The Bill proposes to fix the rate of capital gains tax on specified assets acquired on 22nd February, 2019 at 20 cents for each dollar of the capital gain. The clause in question further disallows certain deductions from the gross sale profits such as acquisition costs on specific assets acquired before 1st February, 2009. This implies that for such specified assets, the gross amount will be equivalent to the capital gain and liable to a tax rate of 5%.
On marketable securities, the Bill seeks to restore exemption of marketable securities from capital gains tax. Furthermore, in order to curtail speculative tendencies, the Bill seeks to increase the capital gains tax withholding tax from one percent to one and half percent on the transfer of shares that are held for a minimum period of six months.
I will now turn to the methodology for calculating capital gains. Mr. President, the Bill seeks to reinstate the repealed inflation allowance on a deductable expense when calculating capital gains in cases where a specified asset has been disposed in foreign currency. Tax legislation used to provide for an inflation allowance equivalent to 2,5% of the purchase price as a deduction in determination of capital gains in respect of a year assessment or part of a year assessment. In the case of local currency, the inflation allowance shall be determined as the difference between the all items Consumer Price Index at the time of sale and the time of purchase applied on the purchase price of the property or revalued amount after including costs of improvements, alterations or additions.
I will now turn to the Dairy Revitalization Fund. Mr. President, in line with interventions proposed in NDS1 to improve performance in the dairy value chain, the Bill seeks to introduce a levy of 5% on the value of imported dairy products. The funds will be ring-fenced to recapitalize the Dairy Revitalization Fund targeted at growth and development of the dairy sector by increasing the national dairy herd, enhancing competitiveness of the dairy sector and support modernization and standardization of local milk production.
In addition, the Bill seeks to introduce a levy of US$50 which will be collected prior to registration of a new cellular handset by mobile network provider. The levy will be payable only in the absence of proof that customs duty on the new handset was paid. In order to enhance fairness and equity in tax treatment of certain excisable products such as alcohol, beverages, opaque beer, cigarettes, tobacco and airtime, the Bill also seeks to ensure payment of excise duty on all equivalent excisable products.
I now turn to a specialised duty on pre-owned motor vehicles. The Bill seeks to compel pre-owned motor vehicles to pay special excise duty within 30 days from the date of assessment; after which interest and penalties are chargeable. This Bill also specifies rates of special excise duty payable on transfer of ownership of pre-owned or second hand motor vehicles in line with economic developments.
I now turn to Clause 35 in the Bill which pertains to the calculation of mineral royalties in terms of change of methodology of simplification of methodology. Despite the clear intentions of the legislature to levy mineral royalties on the gross value of minerals otherwise contained in all body, companies are applying different methodologies to calculate royalties. Notably, most companies disregard the specific legislative provision prohibiting the deduction of beneficiation costs when calculating the gross fair market value.
The Bill seeks to implement a standard methodology for calculation of mineral royalties that clearly outlines how the fair value of the minerals consumed on invoice would be calculated. Specifically, rates of royalty for specific minerals on minerals bearing all shall be calculated by using the following criteria. In the case of the platinum group of metals starting with the concentrate - for concentrate 85% of the international price of the refined mineral contained therein by reference to the price of the London Metals Exchange on the date of transaction of which royalty will be paid.
In other words, what is considered to be concentrate is 85% of the London Metals Exchange price. On the case of metal which is a higher level of beneficiation, this is 90% of the international price of the refined mineral contained therein by reference to the price of the London Metal Exchange on the date of the transaction on which royalties will be paid. In the case of gold, invoice value is determined from time to time by Fidelity Printers and Refineries. In the case of diamonds and all other minerals the invoice value will be as determined by the Minerals Marketing Corporation of Zimbabwe. I now move that the Bill be now read a second time. I thank you.
(v) * HON. SEN. TONGOGARA: Thank you very much Mr. President. I would like to thank the Minister of Finance for the Bill that he has brought before us. I would like to ask what provisions they have made into those gold mining areas? Small scale miners are bringing more gold but it is not reaching Fidelity. What has been done to those middlemen who are intercepting the gold? In that case Government is losing out. Thank you very much Mr. President.
(v) + HON. SEN. A. DUBE: Thank you Mr. President. I thank the Minister for this pertinent Bill. Are there any other plans that can be made because women have problems in business? I want to ask the Minister so that women may not be affected because I can see that this can be a problem to women.
(v) HON. SEN. CHIEF NDLOVU: My question to the Minister would be on the issue of the cell phone duty. He seems to have had a blanket approach to the duty that is charged for a cellphone that costs US$10 and also a handset that costs over a US$1000 that each one of these has to pay similar duty. We do realise that once the duty is paid to ZIMRA, the proposal is that the person who is paying has to go and claim the US$50 from ZIMRA - you realise that it is going to cause challenges to the poorest in the community, some of whom will be in rural areas. To try and recover US$50 from ZIMRA is a huge challenge. We know the challenges that we have with ZIMRA even if you are looking at companies that have got millions of dollars that they need to claim from ZIMRA, they struggle and it is going to be worse for someone who is travelling from rural areas to come and claim US$50 fee that would have been imposed.
Secondly, the duty seems not to consider that we are trying to have a penetration of internet access and gadgets to be used by people in rural areas and the imposition of this duty is going to further disadvantage those of our communities in rural areas. There should either be the scrapping of this duty or reconsideration in terms of the amounts that are paid. They have got to be varied and probably, the Minister should consider trying to rationalise why a certain amount has to be paid than to have a blanket approach. Thank you Mr. President.
(v) *HON. SEN. CHINAKE: Thank you very much Mr. President. He mentioned minerals but nothing has been said about diamonds – what is our country getting from diamonds? What are we doing with these diamonds? Some countries have been mining for 4 to 5 years, what has been the benefit for Zimbabwe?
(v)HON. SEN. B. MPOFU: Thank you Mr. President. I wanted to find out from the Minister of Finance as to what programmes there are to introduce the Real Estates Investment Trusts? This issue has been on the Bill for the last two or so years but on the ground, nothing has happened. We want to understand what programmes and what financing has been put in place to ensure that the Real Estate Investment Trusts are introduced effectively in Zimbabwe. Thank you.
(v) * HON. SEN. CHIFAMBA: Thank you Mr. President. I would like to know from the Minister what plans are in place to assist women and girls on the issue of family planning? If the Government does not assist on the issue of family planning, there will be a lot of abortions because of unwanted pregnancies. People will not be able to plan their families, hence they will have unwanted pregnancies. Does Government have urgent plans to intervene on the issue of family planning because many women and girls would die, trying to abort unwanted pregnancies using illegal means?
Also, what are Government’s plans with regards to Government employees who earn low salaries so that they are afforded an opportunity to import duty free vehicles? We have women who are teachers and nurses; they cannot afford to buy vehicles on direct markets because of import duty. Also the US$50 tax which Government imposed on cellphones, in Zimbabwe we earn RTGs, how are we going to get that US$50 to pay tax for a cellphone? I thank you.
(v) *HON. SEN. CHIEF CHUNDU: Thank you Mr. President. I am seeking clarification from the Minister on the issue of minerals which the Minister alluded to. He said that we have a lot of minerals in rural areas. As traditional leaders, we have Zunde raMambo. Zunde raMambo does not stand for agricultural produce only. It represents everything that comes from the soil. I do not know in this Bill, is it not proper to empower chiefs so that we are able to protect those minerals which are being taken away by middlemen? We need to have a Zunde raMambo for minerals to safeguard minerals in our rural areas. Government will come direct to us and exploit the reserves that we will be safeguarding so that our country can improve economically. I thank you Mr. President.
HON. SEN. D. M. NDLOVU: Speech not recorded due to technical glitches.
(v) HON. SEN. ENG. MUDZURI: Thank you Mr. President Sir.
The Hon. Minister has presented his Bill but I want to understand from the Minister, whether he is indicating left or right because today there was a Statutory Instrument on passports. The passports were gazetted to be paid in US$, when a common man, vanenge vasina US$, saka vanotora mapassports sei? We are saying we want to use local currency but we charge such documents like a passport in US dollars. Secondly, why is it that civil servants were given bonus in US dollars and ZIMRA staff were not given anything; they have no bonus. I know they are a private entity but they are under the Ministry. Why were they not given anything?
HON. SEN. D. M. NDLOVU: Speech not recorded due to technical glitches.
(v) HON. SEN. CHIEF MAKUMBE: Thank you Mr. President. In the previous Budget Statement, it was evident that the allocations were not tallying with the disbursements. What is the Minister going to do in order to address that problem where allocations are not tallying with disbursements? For example, the Parliament of Zimbabwe which was allocated some money last year only got a disbursement of around 50% of what it was allocated.
Further to that, I would also want to understand from the Minister how this budget is going to stimulate growth in industries. How is the local industry going to be propped up in terms of work that is not done here because the budget to me is Government’s shopping basket? So, it is there to look after a social economic problem. How is the local industry going to benefit in this budget, in terms of growth and production?
(v) +HON. SEN. N. KHUMALO: Thank you Mr. President. My question to the Minister pertains to children funded under the BEAM scheme. That money is very little and it is disbursed late in schools yet they need it for basics such as uniforms and stationery. So they do not get help to acquire those. At the end of the day, parents are forced to chip in, yet those are the same parents who would have failed to pay for those children. Most of them end up dropping out of school. Is the Minister aware of this and what is the plan to rectify this? I thank you.
THE MINISTER OF FINANCE AND ECONOMIC DEVELOPMENT (HON. PROF. M. NCUBE): Thank you Mr. President Sir. I would like to thank the Hon. Senators for their interventions and questions. I now proceed to give responses. I will start with a question from Hon. Sen. Tongogara who inquired about support that we are extending to small scale gold producers in the middle of the year, even before this budget in the middle of 2021, I reduced the royalty for small scale producers from 2% to 1% and this has gone a long way in stimulating production from the small scale producers but secondly, we are developing what we call gold centres right across the country.
These are one-stop-gold centres that will support the small scale producers in their digging, their mining and providing them with equipment and then transportation to a central point where crushing facilities will be extended and then upon crushing and their preliminary assessment of the quantum of gold in their ore, they are paid. There is an office there, Fidelity office, Reserve Bank office, where they will receive their payment and then they again go back onto the mine and restart. These gold centres, the working model is in Bubi just outside Bulawayo airport and then we are targeting other areas such as Mapaha in Mashonaland East, among other centres. The target is 10 centres and in the budget, under the section on SDRs, there is an allocation there of about US$10 million and about US$1 million per gold centre that we are going to be rolling out this coming year.
Coming to Senator Dube, Mr. President, he enquired about the duty on phones and the same thing applies to Sen. Ndlovu who also referred to the duty on phones. First of all, Mr. President, the issue on phones is not duty. It is an enforcement levy, there is already a duty. The duty is 25%. Whenever you bring in a new phone into the country, you are supposed to pay 25% of the value or the assessed value of that phone. This has been there for quite a while. There was a time when this duty was 40% and in fact, it was reduced to 25%.
When it comes to other electronic gadgets, we have actually reduced the duty to zero. The only duty remaining is the 25% duty on phones. So what is the problem, what problem are we trying to solve? The problem we are trying to solve is that no duty of 25% is being paid by anyone who is bringing phones into the country. Why? Because these are small gadgets, you put them in your pocket or wherever in your handbag and you pass through the border. No duty is paid. We are not collecting anything. What we are trying to do is to design a mechanism that can enforce the payment of the 25% duty, hence this 50% levy. It is only payable if you cannot prove that you have paid the 25% duty. So it is not a duty, it is an enforcement mechanism to enforce the payment of the duty which already exists in the first place.
Let me turn again to Sen. Ndlovu - if there is a second part to her question. Yes, it was about that. Then Sen. Chinake, he enquired about the revenues from diamonds. Yes, we have received some revenues from the marketing or sale of our diamonds, just that in the budget I did not report that, but we are happy to report that. If it pleases the Senator, we can always report separately and give them the very accurate figures as to how much diamonds we sold in the last year or two. We are happy to supply those figures.
Then on the introduction of Real Estate Investment Trusts (REITs), the legislation on the introduction of REITs is already in place, it is fully functional and I am aware certain private players have approached the regulator, the Zimbabwe Security’s Commission, to seek permission to launch these products. So it is my expectation that in 2022, some market players will launch REITs products. The advantage of REITs Mr. President, is that they will help us to deal with a challenge we are facing with our pension funds who have a large exposure in the property sector but have liquidity challenges in paying the beneficiaries, the pensioners and the REITs will enable them to unlock that liquidity and be able to support the requirements for their pensioners.
I now turn to the issue of family planning. The question was posed; I could not tell who posed that question Mr. President.
THE HON. DEPUTY PRESIDENT OF SENATE: Sen. Chifamba.
HON. PROF. M. NCUBE: I just wanted to say Sen. Chifamba, in the 2022 budget, we have allocated $2.48 billion towards the Ministry of Health and Child Care for purposes of dealing with family planning issues which cover issues such as for instance, improving reproductive and maternal health, dealing with new born children, adolescent health issues and nutrition services. This is under Programme 2 in the Public Health budget because we are doing programme based budgeting. If they could check under Programme 2, this is well catered for. So in terms of the budget, I think we have allocated adequate resources, now it is a matter of just the action in terms of execution which lies with the Ministry of Health and Child Care. Perhaps that is what we can follow up on, but the resources have been applied to that challenge.
Then on the issue of duty free or provision for civil servants in terms of importation of cars, this is in place. The Senator is right to raise this issue because in the budget for 2021, when I gave the statement, I put some kind of sanctioned clause regarding this benefit for civil servants but we realised that if we proceeded with curtailing civil servants from duty free importation of vehicles, this was going to shrink what we call monetary benefits substantially. So we stepped back from that to say you know what, let us continue with this provision indefinitely. That is what I have done in this budget. So that is continuing and civil servants will continue to import cars duty free. I must say I have extended that provision in this budget Mr. President, to also include Members of this august House as well as Members of the Lower House. You are now free to import a second car duty free at a time of your choice.
Then also Sen. Chifamba raised the issue of the $50 levy on phones which I have already dealt with. I now turn to Chief Chundu who came up with a very interesting concept, Mr. President, the idea of a Zunderamambo for minerals, but as things stand, the concept of Zunderamambo only applies to food. We did not extend it to other assets. So it is an interesting proposal which requires, I think further reflection, but I do not think in this budget we are able to deal with it. It is something that we will need to think carefully about, really try to understand the role of chiefs as custodians of assets in our rural areas, in our communities. That is a very big subject, which I think we will not be able to tackle under the budget, but it is an interesting one none-theless.
I now turn to Sen. Ndlovu. I could not quite hear what she was saying. I only heard snippets about cancer beneficiaries, then when I heard the word cancer, I said we have something on cancer in the budget which is the Non Communicable Diseases Fund (NCDF) that we set up by increasing taxes on the sugar energy drinks as well as cigarettes. So I hope that she was going in that direction, she can clarify but we have finally managed to take care of that and I think we are one of the first countries in the world, in fact I repeat in the world, to set up a fund that will take care of cancer, diabetes and hypertension.
Let me turn to Hon. Sen. Mudzuri, who basically said perhaps you are sending mixed signals turning left but indicating left then we turn right. We cited the fact that there is a Statutory Instrument gazetted today regarding passport fees being pegged at US$100 for an ordinary passport and much more for an emergency passport. Paying civil servants in US dollars but what about ZIMRA employees - no, we are not indicating right and then turning left. We pronounced two years ago that both the US dollar and RTGS are transaction currencies in our economy. So as Government, whenever we see it fit, we do use one currency for a specific, chosen purpose if we are trying to achieve something. By paying civil servants bonuses in US dollars, including members of this august House, Mr. President, it was to deal with inflation.
We understood that inflation, we suffered quite a sharp spike during the last quarter of the year. We were aware of the impact of that and thought that the best way to cushion our employees right across to the legislator, is if the Executive is to pay the bonuses in US dollars. This has been well received and there is no ambiguity at all. In fact, this has been well received by beneficiaries, they were pleased that we were able to do it.
On the issue of passports, if I can go back to that and maybe address an auxiliary issue which that Statutory Instrument brought about; which is a necessary Statutory Instrument because come end of 2023, the current passport of Zimbabwe as we know it will not be internationally acceptable. What will be acceptable is what we call an e-passport. So as of today, there is a new dawn, a new passport is being launched by the President as I am talking right now. He is doing that in the Ministry of Home Affairs and Immigration, launching the e-passport which has got special features and micro-chips and other sophisticated features that will modernise our passport and make it acceptable globally.
The project was done under a Public Private Partnership arrangement PPP. It has become necessary to designate those fees in US dollars because the foreigr investors spend US dollars in investing in the project and want to be rewarded to recoup the cost of investment.
I now turn to Hon. Sen. Chief Makumbe on the allocations not tallying with disbursements for example Parliament and so forth. This is an issue of disbursements versus cash Mr. President. When we execute the budget, we check what the Vote is, and that the specific request is from a specific department or Ministry for a specific Vote under the PBB arrangement and then we disburse but the cash always follows later and the cash may not be 100% of the disbursement. It might be less, may be you may have two tranches of cash disbursements. This is normal but I must say that this issue of the gap between disbursements and cash has been exacerbated by the issue of COVID-19. In the first quarter of 2021 for example, our budget stayed the same, we did not revise it downwards but demands were still there. The cash dropped in quantity because the economic activity obviously shrunk and we saw that deep in cash both in ZIM dollars and US dollars. So right through the way, we were in a sense playing cash club in terms of our cash disbursements following up on the actual budget disbursements. We will endeavour Mr. President, to close that gap so that the difference between the two is not uncomfortable for the various MDAs.
Hon. Sen. Chief Makumbe mentioned that he wanted to know what this budget is doing to stimulate growth of industries. We are very pleased that in 2021 already, we are seeing the capacity utilisation in industries having risen, which means that there is a way which we have been conducting our policy as the budget execution that is stimulating. It comes from, I will say various angles. Firstly, it is just simple rebate on imported equipment that has gone a long way in basically stimulating industry to make sure they can access imported equipment duty free. In doing so, they are able to access foreign currency from the auction so, the budget has been supporting the auction in the sense that every week Treasury sells between US$10 to US$15 million on to the auction. Treasury never buys US dollars from the auction, it supplies US dollars for the auction and this is coming straight from the budget.
By making foreign currency available to companies, they apply for that successfully and then they buy equipment or essential raw materials, that is supporting companies and their productivity will see capacity utilisation increase substantially. In addition to that, this year we also set aside a part of the SDRs from the IMF towards retooling and again that will go a long way in supporting the industry. This is just one of the ways.
Finally, from Hon. Sen. Khumalo regarding BEAM recourses, she argued that these resources are not enough, we need to do more especially when it comes to books, may be uniforms even if school fees are covered. I must say that we are trying hard to make sure that BEAM pays on time and there are adequate resources but maybe there are special situations which the Hon. Senator is aware of which needed specific attention. This you can always bring forward to us as Government. I am happy to receive that information but also the Minister of Social Welfare is available to receive that. We really feel that we have done quite a lot to support the BEAM programme as part of the product social protection programme that this Government runs. I thank you Mr. President.
Mr. President. I therefore move that the Bill be now read a second time.
Motion put and agreed to.
Bill read a second time.
Committee State: Wednesday, 15th December, 2021.
SECOND READING
APPROPRIATION (2022) BILL [H. B. 15, 2021]
THE MINISTER OF FINANCE AND ECONOMIC DEVELOPMENT (HON. PROF. M. NCUBE): Mr. President, the purpose of this Bill is to give effect to the Main Estimates of Expenditure for the year ending 31st December, 2022, which I tabled to this august Senate on the 25th November, 2021. Section 3 of the Appropriation (2022) of 2021 Bill charges the Consolidated Revenue Fund with a sum of ZIM$858 316 712 000 which relates to the 2022 Vote Appropriations. The Vote Appropriations are meant to finance projects and programmes identified under the National Development Strategy 1, in line with the vision of His Excellency the President of Zimbabwe, Hon. E. D. Mnangagwa of a prosperous and upper middle income economy by year 2030. This should consolidate our efforts towards macro-economic stabilisation critical for ensuring sustained macro-economic growth and social transformation. Government has also transitioned to programme based budgeting whereby the Vote provisions are linked to specific projects and programmes. The 2022 Budget policy measures include, among others; -
- Strengthening macro-fiscal stability;
- Consolidating the Agriculture Food Systems Transformation Strategy that seeks to guarantee food security;
- Advancing the policy on value chains and value addition for purposes of job creation and growth;
- Enhancing public service delivery including social protection and infrastructure development;
- Strengthening governance;
- Continue with the reengagement process; and
- Climate change mitigation and energy security.
In consolidating of macro-economic stability, a prudent fiscal policy complimented by tight monetary policy is being pursued under the 2022 Budget. This entails containing expenditures within the Budget, non-recourse to Central Bank financing, continuation of monetary targeting and improving the foreign currency auction system.
Section 6 (1) of the Bill empowers the Minister of Finance and Economic Development to transfer funds already approved by Parliament between Votes in respect of a function or responsibility transferred between ministries and departments during the course of the fiscal year.
Section 6 (2) of the Bill allows discretion to the Minister of Finance and Economic Development to transfer funds from the Unallocated Reserve which appears on the Ministry of Finance and Economic Development Vote to any other Vote as and when the need arises in order to meet inescapable expenditures.
In addition, and if necessary, the Minister of Finance and Economic Development can vary the amounts so transferred by taking back any surplus for reallocation to other Ministries to meet demands that may arise.
Mr. President, I accordingly move that the Appropriation (2022) Bill be now read a second time. I thank you.
(v)*HON. SEN. TONGOGARA: Thank you Mr. President. I would like to thank the Minister of Finance for the fund allocation he made to different ministries to enable them to function well. I am grateful for the funding of the Ministry of Agriculture. As we all know, agriculture is the backbone of this economy. It was well deserved given the broadness of this sector in the country. All sectors within this Ministry were all well catered for. This funding will go a long way in assisting farmers and ensuring a good harvest for the country. We are thankful for the construction of dams as they will assist in irrigation given the climate change we are experiencing as a country.
The Minister has done well by funding of the Anti-Corruption Unit. May those working in that unit be well resourced and funded so that they can execute their mandate without hindrance. Even funding of the defence forces, I know a lot of people dispute this because they question why we fund soldiers when there is peace in the country. It is during this period that I believe we should train and make sure that we are well prepared for anything that may threaten our peace. A good example is the war in Mozambique. We should make sure that we are prepared and it is during the period of peace that we are supposed to make sure we are prepared.
Now for the Ministry of Health and Child Care, as mentioned by the minister, if we make sure that we are now into production of these medicines in the country, we will no longer have a problem of foreign currency needed. People are dying because there is no foreign currency to assist them. If that is done, it will be very helpful. It is my desire that there be an establishment within the Ministry of a department of preventative services to make sure that we are in a position to fight any threatening diseases, thereby cutting costs for the nation. A good example is the COVID-19 pandemic that has hit us again as a nation. Its impact has been reduced as we have a lot of people vaccinated against the disease. Thank you very much Mr. President.
HON. PROF. M. NCUBE: Mr. President, I really thank Sen. Tongogara for a comprehensive intervention and understanding of how we have gone about allocating the budget in some of these critical ministries. Starting with agriculture, she carefully went through the various programmes that we are funding in that budget of $124 billion and I thank her for carefully noting all aspects of that budget. I will not repeat but just to say this is very important that the budget is trying to speak to the whole notion of food security. Without food security, we would be in a bad state as a nation.
She also went on to commend the budget for the Anti-Corruption Commission, especially on the prevention of corruption. We have a whole item on prevention of corruption in the budget that we allocated a specific budget. This is a very important issue and we respond to the call from Anti-Corruption Commission to allocate a budget for it and she has noted this as well.
Coming to the Ministry of Defence and War Veterans Affairs, it is a very important Ministry and the comment that sometimes you need to invest more in this kind of a Ministry during peace times because you have the time to do so; the time to think, reflect, plan and strategise, and she is right. That is what we have tried to do as well in these peaceful times. We have been investing in the development of the cantonment areas for the military and their mobility in terms of vehicles.
Also, keeping improving on the notion of a military salary because members of the service cannot go on strike and so, they always need special conditions in terms of their emoluments. We are trying, it is never easy. We have also been revamping their equipment. I have to mention the issue of vehicles and also mobility. She is right that we have to continue to invest in defence and security during peace times and that is what the budget seeks to do.
Coming to the area of health, again, she has noted four buckets in which we have allocated the budget for the Ministry of Health. She mentioned specifically the issue of preventive services. This issue I thought that is kind of subsumed under the allocation on public health, that is where the issue of preventive services is subsumed. Perhaps she is suggesting something in future to say perhaps in future, we should separate it to let it stand out separately and I think that is a good idea indeed in future budgets to take that into consideration. I thank you.
Motion put and agreed to.
Bill read a second time.
Committee Stage: Wednesday, 15th December, 2021.
On the motion of THE MINISTER OF FINANCE AND ECONOMIC DEVELOPMENT (HON. PROF. M. NCUBE), the House adjourned at Fifteen Minutes to Four o’clock p.m.