1. Mr. Speaker
Sir, I move that leave be granted to bring in a Bill to make Provisions
in connection with Revenues and Expenditures of the Republic of
Zimbabwe and to make Provisions for matters ancillary and incidental
to this purpose.
Mr Speaker Sir, I wish to start my Budget speech by acknowledging
the valuable support and cooperation that I continue to receive
from Parliament in the formulation and implementation of the National
3. This is consistent
with Government's commitment for improving the budgeting process
by involving a wider range of stakeholders, including those at grassroots
levels. Such involvement guarantees the ownership of the Budget
by all stakeholders and is critical for sustaining consensus over
the implementation of announced policy measures.
4. It is against
this background that my Ministry undertook a nationwide consultative
outreach programme aimed at involving the public as much as possible
in the Budget formulation process. My Ministry benefited tremendously
from the input of stakeholders to which Government attaches great
5. The central
message from these consultations evolved around the following challenges
6. One of the
consequences of the above challenges, Mr Speaker Sir, is the emergence
of very large income disparities, with the majority of the lowest
paid workers earning below the Poverty Datum Line.
7. The deterioration
in the welfare of our people has seen their capacity to access basic
healthcare services, education, housing and other amenities collapse
overnight, under the prevailing hyper-inflationary environment.
8. This, Honourable
Members, is happening at a time when a small proportion of the population
is now accumulating wealth overnight, in part benefiting from the
price distortions arising from some of the policies and facilities
meant to protect the very poor.
9. In this environment,
the country continues to experience loss of critical skills, the
dominance of the informal sector in the economy, declining capacity
utilisation and de-industrialisation. These are some of the challenges
that the Budget will have to address with 'head-on'.
some of the wealth accumulation is a direct product of the prevailing
indiscipline in our economy. We have amongst the citizens, individuals
benefiting from abuse of public resources and thereby contributing
to unnecessary public expenditures and economic hardship.
11. Mr Speaker
Sir, we therefore need to declare war against indiscipline, and
in this War, the Budget will not be found wanting. We will therefore
need to review and strengthen the legislation and penalties for
12. Mr Speaker
Sir, Honourable Members will be aware of the partnership with the
private sector in the context of the National Economic Development
Priority Programme (NEDPP). The thrust of the NEDPP is the implementation
of Quick Win programmes and projects, whose objective is to stabilise
the economy and lay the foundation for sustained economic growth.
13. The 2007
National Budget will play its critical role of addressing stakeholder
concerns, support the NEDPP measures, foster macro-economic stability
and restore business confidence.
14. Mr Speaker
Sir, it is no secret that the country remains under siege, facing
sanctions from the West, characterised by lack of balance of payments
support, lines of credit, foreign direct investment and deliberate
efforts to undermine our economic turnaround initiatives.
15. This makes
it vital that we employ innovative tactics to survive in this environment,
taking advantage of our abundant natural resource endowment and
reliable cooperating partners.
16. Mr Speaker
Sir, the 2007 Budget will be guided by the Results Based Budgeting
principles adopted by Government in 2005. Hence, the expenditure
allocations for the coming year are related to the anticipated and
time-framed deliverables during 2007. I am happy to note that submissions
from line Ministries now take the Results Based Budgeting format
17. The setting
of specific deliverable targets for the respective line Ministries
under the 2007 Budget should also assist to 'turn the tables'
on the major inflation drivers under Ministries' domains through
active focus on productivity and close monitoring at the Ministry
level. In this regard, the Budget will ensure that Ministries focus
on their roles and responsibilities in fighting the overall inflation
18. Mr. Speaker
Sir, Honourable Members will be aware that the implementation of
our Currency Reform exercise on August 1, 2006 resulted in the revaluation
of the currency with the removal of three zeros from the old bearer
cheques and the introduction of a new set of bearer cheques. Hence,
in my presentation, all domestic currency statistics reflect the
19. Mr Speaker
Sir, my presentation will cover the fiscal performance up to October
2006 and the estimates to year end. I will also touch on the economic
challenges we are facing as a Nation.
20. Mr Speaker
Sir, allow me to first of all give a brief overview of the Global
Economic Outlook, as well as a review of recent Domestic Economic
performance and projections for 2007.