Harambee is dead! - Nico Smit
Law maker for the official opposition, Nico Smit has said President Hage Geingob’s Harambee Prosperity Plan was now clearly dead following the mid-term budget review which he said showed that government was broke to the point of borrowing to cover its deficit.
“This may sound harsh, but it reflects the facts of our situation in Namibia,” said the opposition politician this week in the Auguste House.
Smit substantiated his statement by questioning how government was going to fund its deficit for the second semester of expenditure if it had issued 98% of budgeted debt.
He said it has come out clearly that the budget review, offered as necessary adjustments according to broadly set priorities, had become government’s most blatant form of window dressing.
He quoted from the budget review which placed total debt for mid-year outturn at N$81.3 billion and interest payments outturn at 9.9% of total revenue compared to a budgeted 5.7%.
The budget deficit stood at 48% of the total budgeted, compared to 30% in the previous period while guarantees issued to date stood at 6.4% of the total economy.
According to Smit, this picture is contrary to that conveyed by finance minister Calle Schlettwein and added that the budget statement itself was the most condemning evidence that all fiscal space had disappeared.
“There is no more wiggle room,” he weighed in saying the best government could do was borrow some more.
“What will the minister use to fund the second semester? The figures presented to us cover only the period April to September 2018. On the government’s calendar, six months still lie ahead. Somehow, it must make ends meet between now and the end of March next year.”
“How is he going to do this? By juggling allocations around between votes? By reducing expenditure ceilings? By aligning expenses with income? I seriously doubt that the last two will ever be accepted by government,” he said.
What’s the way forward?
Smit said the only option at the mid-term point was to take away small cosmetic amounts and re-allocate them to priority votes to try and prevent a complete meltdown and collapse of government services for those most dependent on them.
“It is all window dressing,” said the politician adding that government was robing Peter to pay Paul, which to him, is a desperate attempt to plug holes.
He also said this served to deplete the economy’s future growth.
“Because the money comes from the capital budget which is the foundation that must drive future economic expansion. In the main budget at the beginning of this year, the minister was happy to tell us that the development budget has been increased by 12% but he forgot to mention that he plundered it in the 2017 mid-term review, bringing it down to the paltry level of 8% of total expenditure. Now he has done it again,” he added.