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2012 budget strategy paper
Tendai Biti, Minister of Finance - Government of Zimbabwe
October 05, 2011

http://www.zimtreasury.org/budget.cfm

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2. The launch of the Medium Term Plan (MTP) in July, as a follow up on the Short Term Emergency Recovery Programme (STERP), also allows us to take a longer-term perspective to fiscal planning, and improve on budgetary processes, for the attainment of sustainable growth and transformation.

3. Consistent with the above objectives, Government is introducing the Budget Strategy Paper (BSP), which is a budget policy framework for the year 2012 as well as the outlook for 2013-2014.

4. As previously pronounced, it remains Government's unwavering commitment to transform the economy into a developmental state, with the ultimate objective being to improve the standards of living of all Zimbabweans. Hence, this BSP remains anchored on such a transformative agenda.

5. Clearly, and as intimated in our STERP programme, the economic turn-around highly depends on the democratisation of policy making, including formulation of budgets that are gender responsive, and inclusive of all stakeholders,

6. The BSP embeds a strategic top-down approach, complemented by a participatory bottom-up approach that empowers line Ministries to bid for resources strategically, and in line with the overall expenditure ceilings.

7. Specifically, the BSP identifies issues to be addressed in the 2012 National Budget, derived from previous budget consultations, the Government Work Programme and Sectoral Plans, STERP II, as well as the Medium Term Plan (2011-2015).

8. The BSP reinforces the application of the Public Finance Management Act [Chapter 22:19] as well as rebuilding policy management capacity and accountability in the management of public resources.

9. The key principles of the Budget Strategy Paper (BSP) are: -

(a) Medium-term Macro-Fiscal and Expenditure Framework (MFEF), which contains forecasts of revenues, cooperating partner inflows and debt servicing requirements. This serves as a top-down hard budget constraint.

(b) Fiscal planning, particularly annual budgeting, requires re-focus towards a medium term outlook, whilst at the same time endeavouring to improve effectiveness and efficiency in budgetary processes.

(c) Alignment of spending with national policy priorities and Ministries' strategic plans, following consultations with stakeholders.

(d) Overall spending ceiling, based on sector strategic priorities for the forthcoming year and indicative estimates for a further two years.

10. Accordingly, the BSP is a tool meant to facilitate broader participation and in-depth debate on the national fiscal and other macro-economic policy issues, as a prelude to the 2012 Budget consultative process.

11. This, unlike in previous years, also allows more time for stakeholder participation during the consultative and Budget formulation phases and, hence, enriching the effectiveness of the Budget as a major macro-economic policy tool as it would have been subjected to public debate.

12. The BSP is, accordingly, relevant to a wide range of stakeholders, Parliament, the public, business, labour, and civil society.

13. The introduction of a BSP, as input into the budget formulation process, is also consistent with regional best practices.

14. In the case of other SADC and COMESA countries, South Africa issues a Medium Term Budget Policy Statement; Zambia and Namibia, Medium Term Expenditure Frameworks; while Uganda produces a Budget Framework Paper; and Kenya, a Medium Term Budget Strategy Paper.

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