Parliament has passed the K2.84 trillion 2022/23 National Budget with no significant adjustments to allocations for key sectors such as health and some governance enforcement institutions despite lobbying by activists and legislators.

The budget, which rolls out on April 1 this year, was approved yesterday after Parliament passed the final round of votes in the Committee of Supply. The votes included Malawi Human Rights Commission (MHRC) whose allocation has been maintained at K1.375 billion and that of the Office of the Ombudsman at K1.254 billion.

MHRC, a constitutionally established human rights watchdog, had expressed its wish for increased allocation, noting that low funding could affect its National Human Rights Institutions accreditation which is due this year.

A report by parliamentary committees on Public Appointments and Commissions, Statutory Corporations and State Enterprises, which assessed proposed allocation to the MHRC, had also echoed the call for additional funding.

Gwengwe (R) interacts with Minister of Trade and Industry
Mark Katsonga Phiri after the budget was passed

The allocation to the health sector, whose vote was passed on Tuesday, remained at K283.5 billion, representing 10 percent of the national budget. 

Activists and the cluster Parliamentary Committee on Health, HIV and Aids and Nutrition had rallied behind a call for the budget to be adjusted to match the Abuja Declaration which sets the parameter of 15 percent of the national budget.

While government is optimistic that it will smoothly implement the financial plan through, among others, enhancement of locally generated revenue, the opposition is pessimistic and warned that the budget may collapse due to inflation, rising fuel prices and foreign exchange shortages.

In an interview after the budget was passed, Minister of Finance and Economic Affairs Sosten Gwengwe said government has done its best to support good governance institutions.

He said: “We were able to substantially add some resources. For example, just for the Anti-Corruption Bureau we had to move them from K4 billion [in 2021/22] to over K6 billion.

“Under the good governance aspect under the Tonse Alliance government, we had to make sure that under the tight fiscal space we have, we still had to fund these institutions so that they are to function better than before.”

On implementation of the fiscal plan, Gwengwe was hopeful that measures they have put in place will succeed.

“We have devised about 26 action points or deliverables from this budget and will be moving forward to make sure that all ministries, departments and agencies are properly aligned to make sure that we go on overdrive to implement the things that have been put in the budget,” he said.

The minister sounded optimistic that Malawi Revenue Authority (MRA) would achieve the K1.6 trillion target it has been tasked to collect.

But main opposition Democratic Progressive Party parliamentary spokesperson on finance Joseph Mwanamvekha, a former minister of Finance, cast doubt at the possibility of government implementing the budget successfully.

He said: “Prices of commodities will continue to go up because we have not addressed the underlying factors of inflation and high exchange rates. You will see this budget will become valueless. Fuel prices will soon go up and that will mean prices of (commodities) going up further.”

In his reaction, Malawi University of Business and Applied Sciences associate professor of economics Betchani Tchereni said the challenge facing implementation of the budget is lack of resources.

He said: “If we don’t grow the economy, it will be difficult for the minister to realise that amount of money.

“Due to resource constraints, we will not be able to develop our infrastructure.”

The budget has an K800 billion deficit and will generally be financed by locally-generated resources, the bulk of it from tax revenue.

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