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As Thahane cracks down on spending

Staff Reporter


MASERU — Jesus fed 5 000 men with five loaves of bread and two fish in the Sea of Galilee.

If Finance Minister Timothy Thahane had the same powers he could have worked the same miracle with his budget.

But because he lacks those powers he had to make do with what he could with so little.

In the end his reduced budget presented on Friday might not have satisfied everyone but at least everyone got something.

Although the M10 476 million at his disposal this year is far less than the M11 687 million he allocated last year Thahane still managed to keep most of the government’s development projects running.

Thahane’s budget cut recurrent expenditure (salaries and other operational costs) by 16 percent but increased capital expenditure (infrastructural development) by 3.5 percent.

That means there won’t be much money for workshops, foreign trips and per diems for civil servants but hospitals will be built and roads will be constructed.

Old age pensions were not reviewed from the current M300 per month but at least pensioners got something.

Civil servants are angry at the 3.5 percent salary increase but at least they got something.

It was never going to be an easy budget to share amongst the country’s perennial problems like poverty, HIV and Aids, and general lack of development.

Revenue from the Southern African Customs Union (Sacu), Lesotho’s main source of income, had nose-dived. Lesotho’s share from the Sacu purse is getting smaller and will continue to shrink for the next three years.

To cover the gap left by Sacu, Thahane said the government was going to review rates, fines and charges. Government deposits and bonds will also be used to raise money, he said.

And, to save the little money available, Thahane said the government “will cut down on wasteful expenditures, fraud and corruption,” Thahane said.

“Basotho have to tighten their belts and push for more domestic revenues. They also must learn to do away with the growing culture of expecting hand-outs from government.”

Lazy and inefficient civil servants will be disciplined as the government seeks to improve efficiency.

“The government will no longer tolerate public criticism for poor service delivery without taking appropriate action,” he said.

The minister also said the government would implement effective strategies of collecting taxes and outstanding debts, “especially monies from students who have not taken the initiative to pay back the National Manpower Development Secretariat”.

“We will also devise concrete and sustainable strategies to recover monies from students who were sponsored by the National Manpower.

“We realised there was a need to channel more money into financing scholarships, hence the M469.7 million provision for the 2010/2011 fiscal year.”

The finance minister said the contribution of agriculture in the economy continued to decline during the last decade and that where government made provisions of loans, it suffered low repayments.

“The government had subsidised inputs to farmers including the purchase of and sale of mechanical equipment at subsidised rates.

“Unfortunately all these initiatives have suffered low repayment rates by the farmers including block farmers.

 “We will do that through the training of wool farmers in better husbandry, shearing, sorting and classifying of wool and constructing and rehabilitating wool sheds,” Thahane said.

“We will also re-energise and commercialise the dairy industry.   

 “Government cannot at this time propose significant salary adjustments after taking into account the level of inflation and other factors,” Thahane said.

“I would propose that a modest adjustment of 3.5 percent be awarded to all civil servants across the board.”         

Thahane said Lesotho’s economy will grow by 3.6 percent this year up from the projected growth of 2.1 percent last year.

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