The National Assembly yesterday approved government budget estimates for the 2012/13 financial year after five days of heated debate and tension.
The budget was approved through voting as Clerk to the National Assembly Thomas Kashilillah called out the names of individual legislators to register its approval or rejection.
Kashilillah announced the results, saying: “54 members of Parliament were absent, 297 votes were cast, 72 votes were against and the majority 225 votes approved the budget.”
All the MPs who approved it came from the ruling party as all present legislators from main opposition party, Chadema, and the second-ranked opposition party, Civic United Front (CUF), opposed the motion. Likewise, Augustino Mrema, legislator for Vunjo (TLP) opposed the budget while John Cheyo (Bariadi East, UDP) supported it.
CCM legislator for Kisesa Luanga Mpina, who publicly expressed opposition to the budget at a press conference last weekend, did not vote yesterday, most probably following Minister of State in the Prime Minster’s Office (Policy, Coordination and Parliamentary Affairs) William Lukuvi’s pressure to win him over.
Mpina absented himself by walking out of the House chamber shortly before the voting was to begin.
Earlier, when summing up and responding to issues raised by the legislators when debating the budget speech, Minister for Finance Dr. William Mgimwa pleaded with the MPs to support the proposed budget.
He however said he had noted the serious commitment shown by the legislators to ensure the budget served Tanzanians better.
On the issue of insufficient allocation of money to development expenditure, which was the main bone of contention, Mgimwa said:
“Most legislators have said they would want to see 35 percent allotted to development expenditure and 65 to recurrent expenditure. The fact is that when you spend on human resources development this is also an investment, therefore is development expenditure. This was elaborated by minister Wassira this morning. When you include this amount you end up with 35.5 percent for development expenditure.”
The minister was referring to Sh841.4billion that has been set aside for human resources development which if added to the Sh4.7 trillion development funds indicated in the budget brings the total amount allocated to development to more that Sh5.5 trillion
On the proposed waiver of Value Added Tax (VAT) on textile products made from domestically produced cotton, he said: “We have noted the concern, but due to government procedures and practices we are keenly looking into this matter and the final decision will be given during the tabling of the Finance Bill”. Under the new schedule the Bill will be tabled towards the end of the Parliament meeting late in August.
Dr Mgimwa also responded to queries on the national debt, saying it was bearable according to international standards.
He said debt sustainability analysis was measured by five international indicators, all of which showed that Tanzania was in good position to sustain it.
“One of the measurements of debt as a percentage of the GDP threshold should not go beyond 50 percent of the GDP and, as a matter of fact, for Tanzania it is 18 percent. As a percentage of the local revenues it should not be beyond 300 percent. Ours is 101 per cent,” he noted.
With regard to preparation to manage gas resources, he said the government had allocated Sh93 billion from internal revenue to pay for a debt of $1.225 billion acquired for the construction of a natural gas pipeline. He said it was time to energize the country and stimulate the national economy.
He explained further that the Tanzania Revenue Authority (TRA) has been enhancing its staff so as to be competent in dealing with matters related to revenues and taxes in the energy and gas sectors, adding that the Attorney General’s office was doing the same to that end.
Concerning the skills development levy, which most of the legislators wanted removed, Mgimwa said it would be dealt with accordingly and by January 2013 the final decision would be announced.
Mgimwa said also that the government was in the final stages of establishing the Tanzania Agricultural Development Bank (TADB)
“Sh72.6bn will be disbursed to strengthen the capital for government banks, including TADB and Tanzania Investment Bank (TIB). These funds are already allocated in the 2012/13 budget,” the minister said.