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INSTITUTIONAL AND SOCIO-ECONOMIC CONTEXT OF ZAMBIA’S NATIONAL BUDGET

Paper Presented at a “Seminar for Parliamentarians on the Role of the Parliament in the National Budgetary Process.” attended by Zambian Government representatives and Civil Society organisations

It is a distinct privilege and a serious challenge to have this opportunity to speak to the elected servants of the Zambian people at the opening of this “Seminar for Parliamentarians on the Role of the Parliament in the National Budgetary Process.”  I thank the Integrity Foundation Zambia and the Friedrich Ebert Stiftung for this invitation and the Honourable Members and others participants for your attention.

My task is to comment on the “Institutional and Socio-Economic Context of Zambia’s National Budget.”  I do this as a political scientist working with a team at the JCTR involved in analysis and advocacy on social justice issues, an active participant in Zambia’s civil society,  and as a Catholic priest assisting in a poor parish outside Lusaka where these issues take on flesh and blood in the people I serve.

In very brief fashion, I intend to touch on the context of your work in the weeks ahead by suggesting some reflections, by way of a framework, on:

1.      The process of Parliament’s involvement in the national budgetary system the institutional or “how” issues

2.      The content of the national budget itself: the socio-economic or “what” issues.

1.  The Institutional Process

Let me begin by repeating a common and rather obvious observation, without, I hope, offering any exaggerations or insults: the Zambian Parliament does not have a good record of intelligent and cogent debate on the budgets set before it each year by the Minister of Finance.  When the final vote of approval has been taken in the past, almost nothing is modified and very little is clarified.  Surely this raises some key questions for this Seminar to consider, such as:

·        Is the expense of sitting for several weeks to engage fruitlessly in a pre-determined budgetary process worth it in terms of service of the people of Zambia?

·        Are there steps that could be taken, right from the start of the process, to assure more meaningful engagement with a document that sets the priorities of the national government’s commitment to promote the development of the people for the next year, with consequences for many years after that?

Let me suggest three salient points that should guide the process in the weeks ahead.

First, there is certainly among the public at large a high expectation that a real multi-party Parliament can promote real multi-party democracy.  For the first time, the Zambian Parliament need not act as a “rubber stamp” on what the Executive offers it, since opposition members are enough to vigorously debate and energetically challenge the budget’s proposals and even deliberately delay and ultimately deny the budget’s adoption.

Now I have heard some fears expressed that this might block the legitimate operation of the government.  But we should be very clear about this: the Constitution of the Republic of Zambia delineates three branches of the government: The Executive (Part IV), The National Assembly (Part V) and The Judicature (Part VI).  If I am not mistaken, all branches make up the government.  The National Assembly is composed primarily (150 out of 158) of elected members, directly representing the ultimate authority in a democracy, the people.  To say that real engagement in the budgetary process by these elected representatives of the people might somehow block the operation of the government is simply not true, since it divorces the Parliament from the government – something constitutionally untenable.

So I urge the obvious: this year get heavily involved in the budget, through good analysis, hard questions, sharp probing, etc.  Utilise the parliamentary procedures available to you – I presume that will be fully explained to you in subsequent sessions of this Seminar – to really put the proposed budget to the test and to offer good alternatives where necessary.

Second, in the process pay close attention to the hard work already done outside the various Ministries of government, that is, in civil society.  As I will emphasis in my later remarks on content, the number one priority of the 2002 budget must be dealing effectively with poverty, the condition of more than 80% of your sisters and brothers living in a situation degrading to their humanity.

Civil society – made up largely of the non-governmental organisations, NGOs, recently derided, very inaccurately and unfairly in my opinion, in a prominent national address given a few days ago – has done very keen work on analysing the poverty situation in the country and coming up with realistic priorities that should be met.  I urge you to familiarise yourself with this work -- e.g., the recent report of Civil Society for Poverty Reduction, CSPR, the budget recommendations of the Catholic Commission for Justice and Peace, CCJP, the expectations of Jubilee-Zambia and other competent groups.  Draw representatives of civil society into your deliberations, through private consultations, open hearings, requested reports, etc.  Obviously, this will require freer and more friendly access to Parliament by Zambian citizens – gates should be opened and hands should be extended, as well as the requirement for coats and ties removed!

Third, the process of creating a truly effective national budget requires a personal commitment that can only come from Members fully aware of their duties and responsibilities.  Years ago, I was told by a member of the Congress of the United States a rather simple truth: “Where I stand on an issue depends on where I sit!”  That is, your stand on school fees, rate of taxes, presidential discretionary fund, agricultural policy, pension payments, etc., depends on where you sit, with whom you sit, how you sit.

I want to urge you to sit on the soft benches of the National Assembly with the people of your constituency around you – figuratively, of course, not literally.  But keep in your heads, and most especially in your hearts, the women and men and children whom you represent – the majority of whom are desperately, inhumanly, poor.  Before you speak on any issue, vote on any proposal, ask yourself this simple question: “What difference will this make in the lives of the poorest in my constituency, in my country?”   I truly believe that that would make a difference in the process of final formulation of a national budget this year, in terms of seriousness, sensitivity and sensibility.

2.  The Socio-Economic Content

It has been said, and I personally believe, said rightly so, that a budget is more than an economic document or a political manifesto.  It is a moral statement.  It is a declaration of priorities of what a government considers socially necessary and therefore ethically important.  As such, it tells the people the government has been elected to serve – whether elected by 28% of the popular vote or by a more democratic majority – what the government really thinks is significant in promoting the common good and securing social justice.  If a government gives higher priority to flying in 52 Mercedes-Benz to serve visiting political leaders than providing basic drug packages to Zambian citizens attending rural clinics, then the people can judge what the government thinks of them.  If a government proffers a president extravagant monies to distribute in gestures of non-prioritised and highly politicised  giving rather than accommodate the structured and open monetary requirements of a Ministry legally established to serve community needs, then the people can judge what a government thinks of them.  If a government gives concessions to foreign investors but does not adjust PAYE levels to reflect the rising cost of living, then the people can judge what the government thinks of them. And if a government declines to deal with rampant corruption (exposed not through opposition parties or independent media but by official reports such as come from the offices of the Auditor General or the Anti-Corruption Commission or select Parliamantary Committees), rather than bring to book perpetrators of such corruption in order to restore resources to meet the crying needs of the majority of Zambians, then the people can judge what a government thinks of them.

My point is clear: the socio-economic content of a budget tells a moral story, whether in terms of revenues or of expenditures.

Tomorrow Professor Seshamani will brief you on the development and poverty situation in Zambia.  I simply remind you now of facts you already know all too well:  80% of the population live below the poverty line, one child out of five die before age five, Zambia has one of the highest rates of maternal death in the world, 20% of the adult population is infected, and 100% affected, by the HIV/AIDS pandemic, and life expectancy is 37 years, “healthy life expectancy” 30.3 years (fourth lowest in the world).  These facts are of course relevant to what the JCTR publishes each month, a “basket” of what is needed for a family of six.  We have recently changed from a simple “Food Basket” to a “Basic Needs Basket” – and seen the total amount top K800,000 per month!  (I don’t know the take home pay of MPs, but I’m sure this figure is disturbing to you personally!)

About ten days ago, I attended a session in which members of the visiting IMF team briefed civil society representatives on their evaluation of the Zambian situation today.  According to them, the Zambian economy in 2001 had “done well.”  Yes, “done well”!  The performance had been good – in terms of economic growth, decline in inflation, etc.  One of the session participants asked the obvious question: “But how had the Zambian people done?”  The answer -- not given, in fact, by the IMF official! -- is also and all too painfully obvious!  (I am reminded of a Catholic bishop in Zambia who, upon hearing several years ago that the World Bank and IMF considered Zambia to be doing well under the Structural Adjustment Programme, asked, “But what Zambia are they talking about?!”) 

Of many, many things that could be said, let me suggest only two issues that I believe should be considered under this heading of the socio-economic content of the budgetary process.

First, in dealing with poverty and the budget, we must distinguish between a “pro-poor budget” and a “poverty-reducing budget.”  I am indebted for this important and helpful distinction to Professor Seshamani, who made the point during our Jubilee-Zambia Debt Forum last week and who can go into greater detail about it when he is with you tomorrow. 

·        A pro-poor budget deals with setting priorities that touch the immediate lives of the poor, e.g., agricultural subsidies, free education, clean water, etc.

·        A poverty-reducing budget deals with gaining resources to meet the larger needs of the poor, e.g., increasing exports, reducing debt servicing (because of debt cancellation), attracting donor support, etc.

Now Zambia certainly wants a poverty-reducing budget, but this is dependent very much on external factors: for example, trade earnings (affected sharply by the events of 11 September in the United States and the subsequent war), donor support (with attendant conditionalities), changes in debt servicing demands (whether through HIPC or outright cancellation), etc.  To be honest, Parliament cannot always determine the direction, timing and content of these external factors.  So it may be that there will not be a large enough supply of resources for Parliament to work on a budget that substantially reduces poverty in the immediate future.

But Zambia can still have a pro-poor budget! For this is a task that Parliament certainly can work on.  Look at the budget to be offered in a few days by the Minister of Finance and National Planning.  It has been worked on for several months.  Does it reflect the priorities of the Poverty Reduction Strategy Paper, jointly worked on by government and civil society?  Does it have commitments -- e.g., to maintaining the positions of District Administrators -- that do not serve the needs of the poor? 

For several years, the pre-budget and post-budget statements of CCJP have emphasised one clear position: the main challenge for Zambia is not resources but priorities.  Surely our resources are always limited and often uncertain.  But within the boundaries of resources, you will still set priorities in what you choose to fund and what you choose not to fund.  And so you ask yourself: given limited monies this year, what should get emphasised to really have a pro-poor budget?  This exercise will require good analysis and free decisions.

Second, the socio-economic content of the budget must itself include the transparency and accountability structures that guarantee the people are served by the government.  This is more than a process issue, this is a substance issue.  Transparency and accountability – integrity and anti-corruption – must be part and parcel of the essence of the budget. 

I offer only one example that deals with something close to my heart and close to all of our pocket books: debt relief.  My colleagues and I in Jubilee-Zambia continue to lobby nationally and internationally for total debt cancellation for Zambia in order to promote poverty eradication.  In a country where debt per capita is over US$ 600 while GNP per capita just over US$ 300 per month, HIPC and other half measures are not the answer.  We want debt cancellation!  And it is possible, on economic, political and ethical grounds.

But we know very well that neither northern creditors nor many Zambian citizens want debt cancellation without some guarantee that resources freed up from lower debt servicing will go toward poverty programmes and not towards Mercedes-Benz.  That is why we are lobbying for a “debt mechanism” to secure a participative and transparent process to orient resources to the poor.  We have recently launched a national campaign for petition signatures to push that lobbying effort.  Moreover, we will this year be lobbying you Members of Parliament to pass legislation guaranteeing that no new loans can be contracted by government without review, evaluation and approval of Parliament.   Right now, the Minister of Finance and National Planning can sign for new loans without consulting Parliament – that must be challenged and changed! These two steps, Debt Mechanism and reform of loan procurement procedures, are substantial elements in the socio-economic content of the budget.

Conclusion

Many other elements in process and content will be treated in this Seminar.  What I have attempted is to provide a framework for reflection with some pertinent practical questions.  I conclude by acknowledging that this session of Parliament will face many challenges, some coming from the sweeping overview offered by President Mwanawasa on last Friday, some arising from the as yet unresolved election petitions, some showing the need for significant constitutional review and revision.  But the challenge immediately in front of you, engaging in the national budgetary system, is clearly of the highest significance.  I repeat, this is not simply an economic or political issue, but a moral challenge.  The Zambian people will be watching how you meet that moral challenge!

Dr. Peter Henriot
24 February 2001