Editor's Comment

Prudent financial expenditure critical

Government complex.

THE decision taken by Government to reduce the number of guests to the Africa Freedom Day investiture ceremony this Saturday by 90 percent is indeed commendable and evidence of its resolve to implement austerity measures.
Government has reduced the number of guests to the Africa Freedom Day celebrations from 3,500 to 350.
It is indeed reassuring that Government has remained focused on its goal to attain prudent financial management.
Last year, Government, in its bid to ensure prudent financial management of public funds as well as managing pressing obligations such as debt servicing, came up with austerity measures to help foster economic stability and growth.
Among the drastic measures taken by Government on expenditure are:
• Reduction on the number of travels and the size of delegations;
• Restricting funding of projects to those that are at least 80 percent complete
• Limiting recruitments to the budget provisions
• Withdrawal of vehicle replacement allowances for ministers and permanent secretaries.
• Cutting of unnecessary expenditures in all ministries.
• Scrutiny of capital expenditure requests prior to submission to Cabinet.
• Indefinite postponement of the contraction of all pipeline debt until the debt is brought back to moderate risk of distress.
• Cancellation of some of the current contracted loans that are yet to be disbursed to reduce the debt service outlays.
• Refinancing of selected bilateral loans, both local and external, to extend the maturity profile and attain lower costs on debt.
• Conducting asset liability management exercise on the debt to ensure sustainability of cash flows;
• Ceasing issuance of guarantees to commercially viable projects; and, the issuance of letters of credit and guarantees to state-owned enterprises that are technically insolvent until their balance sheet challenges are resolved.
All these measures and many more demonstrate Government’s commitment to ensuring the resources entrusted in its hands are used prudently to spur economic growth.
It is indisputable that the move to reduce the number of guests to attend the Africa Freedom Day celebrations will help make a great saving.
At the minimum, if Government spends K500 per guest on food and drinks, this means it would make a saving of K1,575,000.
This is a lot of money which can help sink a good number of boreholes in the drought and hunger-stricken areas other than entertaining individuals.
The savings can also be channelled to buying relief food in the hunger-stricken areas.
Africa Freedom Day though significant, does not require lavish celebrations, especially at a time the country is implementing austerity measures.
As rightly advised by acting Secretary to the Cabinet Patrick Kangwa, people can still follow the proceedings on television as opposed to having 3,500 people in the State House grounds.
This will also help cut on travel and lodging costs for those from other parts of the country who would ordinarily require to come to Lusaka to attend the event.
People can observe this important day from the comfort of their homes and in different parts of the country.
The move taken by Government is in the best interest of the country, which has so many needs begging for attention.
While reducing the number of guests to attend the Africa Freedom Day function may not be sufficient in itself to attain the required results of economic stability and growth, it is certainly a step in the right direction.
Moreover, it is through the cumulative measures that the desired results will be achieved.
It is, therefore, hoped that those charged with the responsibility to implement these austerity measures will not relent but ensure that no stone is left unturned.
We are optimistic that with such measures, the country will attain economic stability and growth for the benefit of all Zambians.

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