GPA331 - 1 Explain the budget process in Zambia The budget is the most important economic policy tool for macroeconomic management and resource

GPA331 - 1 Explain the budget process in Zambia The budget...

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1.Explain the budget process in Zambia The budget is the most important economic policy tool for macroeconomicmanagement and resource allocation for any government. It provides a comprehensivestatement of the nation’s priorities. Over the years, the budget has evolved from beinga simple accounting tool to a planning and governance document upon which thesuccess or failure of government policy can be evaluated. In Zambia it has remained an annually repetitive process. The line ministries anddepartments are responsible for drawing up the budget. However, MOFNP isultimately responsible for macroeconomic policy, the budget and the management ofthe budgetary process. It is empowered to coordinate and manage the budget process.The process consists four stages. These include the drafting, the legislative andapproval, the implementation, the audit and the evaluation stages. We will look ateach of these stages. According to the NEPRU working paperThe Drafting StageThe initial stage in the budget process is the drafting stage.Through this consultative process with other stakeholders, the MOFNP comes up witha national budget every year. The drafting stage involves four steps: the Call Circular,the submission of estimates, the discussion of revenue and expenditure and thepreliminary budget.The Legislative StageAfter the approval of the proposed budget by Cabinet, theConstitution of Zambia mandates the Minister of Finance and National Planning topresent it to the National Assembly. Only the National Assembly has the authority toraise tax and expend revenues.Article 117(1) of the Constitution stipulates that “the Minister responsible for financeshall cause to be prepared and shall lay before the National Assembly within threemonths after the commencement of each financial year estimates of the revenues andexpenditure of the republic for the financial year”. The time span of the authority tospend is restricted to twelve months from February.The Minister’s presentation of the budget to the National Assembly is traditionallyreferred to as the ‘Budget Address’. It is an incident of major significance amongstakeholders and society. Thereafter, the whole House simultaneously resolves intothe ‘Committee of Supply’. This is to meticulously consider the expenditure proposalsministry by ministry. And then proceeds into the ‘Committee of Ways and Means’ forpurposes of approving revenue proposals for the funding of suggested expenditures.1 | P a g e
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Each allocation is discussed through the three stages of the house up to the vault level.Once the budget passes through the three stages of the house, the National Assemblyapproves the budget. It then enacts the Appropriation Act. This is immediatelypublished in the government gazette for the information of the controlling officers inthe budget units.If there is any supplementary expenditure during the budget year, the MOFNP isrequired to prepare a supplementary appropriation bill. This will confirm the approval
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