Thursday, 2 July 2015

'Most govt projects still heavily dependent on borrowing'

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INNOCENT-THE BLOGGER-BOY
Finance Deputy Minister Adam Malima
 Borrowing remains the government’s central funding option to finance development projects, Finance Deputy Minister Adam Malima said yesterday.

 
Addressing the National Assembly in Dodoma, the deputy minister said the government will not stop borrowing because it needs the money to implement development project and he singled out the Rural Energy Agency (REA) project as an example of where the borrowed money will go.
 
The deputy minister’s details were in response to a supplementary question posed by Mbozi Legislator David Silinde (Chadema) who wanted to know why the government continues to borrow to fund development projects despite the raising national debt.
 
Responding, Malima said; “the government has continued to borrow because the government has committed itself to serve its people... we are not taking loans for personal interest but for the interest of the public.”
 
Similarly, in her basic question, Special Seat MP Amina Abdalah Amour (CUF) inquired as to why the government has failed to allocate 30 per cent of its budget to development project as pledged. 
 
She also queried as to government preparations to ensure the budget is not donor dependent.
 
Malima told the House that the government cannot allocate 30 percent of its budget to development projects because it allocates the lion’s share of the budget to recurrent expenditures such as paying salaries of public servants.
“We cannot avoid being donor dependent due to the nature of development that we have,” the deputy minister told the legislators.
 
However, Malima was keen to note that because the government recognises the challenges of being donor dependent, it is working to increase domestic revenues to help fund development projects.
 
According to Malima, the donors’ contribution to the national budget has decreased from 22 per cent in 2012/2013 to 10 per cent this financial year.
 
The deputy minister said the government has also increased the budget for development project from Sh. 2.95 trillion in 2013/14 to Sh. 5.9 trillion in 2015/16 an increment of 100.4 per cent.
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