By Staff Reporter
WE have all woken up to the rude reality of voting for a deceitful government which has the greatest tenacity to breach its promises, says PF vice-president Given Lubinda.
Giving a PF position on the 2022 budget, Lubinda described it as a hoax, an illusion, a façade or a deception, retrogressive, a breach of the fundamental campaign promises upon which the UPND was voted, and that it was pro-capital and against the poor.
Lubinda said the budget had a discrepancy of K37bn on the expenditure side.
He noted that the UPND proposes to grow the budget from K119bn this year to K173bn in 2022 yet they had suggested increases in consumption and reductions in revenue such as Mineral Royalty Tax, corporate tax, and customs duties.
“As though this is not enough they have decided to utilise a onetime revenue stream in the form of the Special Drawing Rights (SDR) of $1.2bn to finance recurrent expenditure. We challenge the UPND government to explain how these recurrent expenditures to be financed by this one-time gift shall be paid in 2023 and subsequent years. Has anyone assured them that this gift shall be perennial?” he asked.
Lubinda asked how the SDR, which was meant as balance of payment support could be transformed into budget support.
He said the SDR could only be used to finance foreign exchange payments outside the country after the government had provided the kwacha equivalent to the Central Bank.
“As you can see this is an illusionary budget which cannot be implemented,” Lubinda said.
On the Constituency Development Fund which has been increased from K1.6m to K25.7 million next year, Lubinda said this was poor dramatics attempting to deceive MPs and the general citizenry that UPND would introduce fiscal decentralisation.
“First decentralisation by those of us who understand it is an organic process which is done gradually and systematically to allow for development of capacity and systems to support it. It does not happen like magic – that you get power from the centre and immediately send it to the most peripheral of the development hierarchy,” he said. “Secondly reading the budget speech critically, you will realise that the central government is simply abdicating on its development responsibilities and its fiduciary responsibility. It has passed on numerous central government responsibilities to constituencies without taking into account the lack of capacity in the constituencies. Actually the financial burden passed on to the constituencies outstretches the K 25.7m by leaps and bounds. It is a clear deception aiming at passing blame for government failure to MPs.”
Ludinda said if spending K1.6m was such a time consuming process marred with irregularities, he wondered what would happen with K25.7m and with increased scope.
“Now that MPs are going to superintend over and get directly involved in the implementation of government projects, who shall perform the oversight function?” Lubinda said. “This move is contradictory to the dictum of separation of power and must be stopped to curtail the intentions of diluting effectiveness of Parliament in its oversight role.”
Lubinda said the UPND won the 2021 elections on a number of promises made to Zambians, among them debt management.
He said the UPND criticised the PF government on the debt contraction.
“They promised that they will be frugal and will not borrow but will instead pay back debt to make it sustainable. Shockingly, if not insultingly, we see a direct breach of the confidence the Zambian people reposed in this regime. Whereas the PF government borrowed $11bn in 10 years an average of $1.1bn per year, this regime in only one year shall borrow $4.6bn,” Lubinda noted. “This is against the campaign gibberish from their President who stated that we had reached the ceiling in borrowing and we could borrow no more. Truth be told, Zambians voted on the basis of well-orchestrated deceit – ‘ba na ti gona’.”
Lubinda said with the desire to fulfill their “lofty promises”, the UPND regime would have borrowed $23bn in five years – double what PF borrowed in 10 years.
“What is striking and saddening is that there is no mention in the budget speech of how this regime intends to handle the amortisation of the first Eurobond which falls due next year. The minister should have spent some time explaining this matter rather than hiding in the name of donors and the IMF,” he said.
On free education from nursery to university promise, Lubinda expressed shock that it would only cover primary and secondary schools.
“What has happened to the promise to our university and college students? Where are the much talked about meal allowances?” Lubinda asked.
“We have all woken up to the rude reality of voting for a deceitful government which has the greatest tenacity to breach its promises.”
And Lubinda said in 2011, the PF doubled salaries for all civil servants and introduced minimum wage structures to ensure more money put in people’s pockets.
“In addition, we increased the tax free threshold from K1,000 to K4,000 to ensure that we reduced the tax burden on individuals and on households. We did this because we are pro-poor in our policies and we pledge to continue being so,” Lubinda said. “Conversely, the UPND having been nurtured by capitalists have done the exact opposite…. This regime has increased the tax-free threshold by a meagre K500 which translates in[to] savings of only K50! At the same time they have reduced standard corporate tax from 35 [per cent] to 30 [per cent] and have made Mineral Royalty Tax deductible thereby introducing a revenue loss of more than $600m (more than K10.2bn) in 2022 alone.”
Lubinda noted that this amount given to capital owners was almost double what the UPND had allocated to Social Cash transfer (K3.1m), Public Service pension fund (K2m) and Food Security Pack (K1m).
“This is money they are putting in the owners of capital at the expense of the poor Zambians. Going further, this regime has decided to subsidise the export of maize to the eventual benefit of the importers by removing 10 [per cent] export duty on maize,” he said.
Lubinda also noted that whereas the PF government was constantly narrowing the gap between the revenues collected from individuals and from corporations, the UPND had projected to collect K17bn from Pay As You Earn as opposed to K16bn from Company Tax.
He said individuals would be paying more to run government than the businesses.
“As though this is not painful enough, the UPND government is threatening to increase the cost of both electricity and fuel by introducing cost reflective tariffs. One wonders how small, medium enterprises shall thrive with high costs of production,” Lubinda said.
Meanwhile, Lubinda said only Kansanshi and Kalumbila mines had been declaring profits and paying Mineral Royalty Tax and company income tax.
He said with the reckless concession given to mining companies, even the two mines would stop paying tax.
“This will lead to the others such as Lumwana and Lubambe which are at the verge of making profits to also not pay tax simply because MRT will now be tax deductible. This is a scandal especially at a time when prices of copper are at the highest and should have benefited Zambians,” Lubinda said. “Are we losing this money for having elected a government that is puppets of capital? For how long shall foreign direct investors call the shots and continue to milk the poor Zambian children of their blood facilitated by stooges of capital?”
Lubinda said he was aware that one of the mining companies had sold a cheap story that if MRT was made deductible, they would in turn invest $2bn and increase production to 2m tonnes per year. “This is the song that you have heard the New Disaster Government singing about,” Lubinda said.
He wondered why the UPND were giving mining companies tax holidays when the price of copper was at its highest.
“How do you expect to raise K173bn to finance the budget when you are giving concessions to your business friends who have money at the expense of the poor?” asked Lubinda.
“When will you come clean on the fact that you did not come to fix the economy as you purported because by all your actions you are fixing the Zambian people?”