One of the cornerstones of the proposed budget for 2012/2013 financial year is to bring down inflation from its current level to a single digit, promote growth through infrastructure improvement and access to social and financial services.
Indeed the cry everywhere is how inflation has literally beaten everybody down. The phenomenon has manifested itself mainly in high food and fuel prices, seriously affecting this basic needs area. Prices of maize, rice and sugar, to name a few, are more than double their level last year.
The newly appointed Finance minister, Dr William Mgimwa in his maiden budget speech in Dodoma yesterday, said as much when he pointed out that the proposed budget has taken on board recommendations from various stakeholders including legislators and ordinary citizens most of whom expressed concern at the high commodity prices, especially of food items and shilling’s depreciation.
According to the last report from the National Bureau of Statistics (NBS) the rate of inflation was 18 percent in May down from 19 percent recorded in March.
The call is for increased food production to deflate prices, but this has not happened due to low investment in agriculture and high transportation costs.
The government initiated a number of measures in the current financial year to address the crisis, but prices have refused to come down at the pace envisioned by economic experts.
Does the budget offer a way forward in this? This is the issue that many will be waiting to hear debated by members of parliament on the proposed budget and expect realistic answers from the minister and his colleagues in the government.
For the budget is the broad roadmap of the country, guiding us on how to improve on what we have achieved.
Of course in order to realise the objective, all stakeholders have to work as one and be well connected at each step.
The minister touched on improving collection and management of revenue. He also promised to control expenditure more closely.
It is important to ensure that this happens this time around. Too many half-hearted campaigns to reduce expenditure have been mounted but ended with little to show in terms of results, leading the public to believe that there is no real commitment on the part of the government to ensure resources are not wasted.
The government must urgently act to remove this perception, leading by example in attacking areas of wasteful expenditure consistently and transparently if it is to restore discipline in public finance management.
The promises include increasing opportunities for economic growth, food availability, cutting inflation, creating jobs for youths and strengthening revenue collection and management of expenditure.
There is also the promise to give priority to three major areas namely, electricity, transportation, clean and safe water and information and communication technology.
No doubt stabilisation of power will make a major difference to the economy, reducing costs of production to douse the inflationary pressure.
Improving transportation through strengthen the railway system, particularly the Central Line and the road network would again offer short and long term benefits to the economy in terms of direct revenue from ferrying passengers and cargo, but also stimulating production activities.
The opportunities to turn round the economy are there. We just need focused action.