Minister of Finance Dr Moeketsi Majoro
Herbert Moyo
THERE will be no more first class travel for ministers under a rafter of austerity measures announced by Finance Minister Moeketsi Majoro yesterday.
Announcing his maiden 2017/18 budget speech in Parliament, Dr Majoro made it abundantly clear that Lesotho must save money for investment into productive purposes to boost economic growth and job creation.
From now onwards cabinet ministers will have to cut back on foreign trips, drastically reduce their bloated delegations and forego first class travel, announced the new Finance Minister.
Dr Majoro said he had formulated the proposed budget against the background of extremely challenging global, regional and local conditions which necessitated cost-cutting measures across the board including government expenditure as it related to ministers’ expenses.
The budget speech was delivered under the theme ‘Pursuing fiscal sustainability within the context of political instability and insecurity’.
Apart from the obvious need for austerity, Dr Majoro warned that Lesotho must deal with its instability and rule of law issues to attract investment.
He described the budget as a transitional budget because he had not had sufficient time to ensure that all feasible policies, promised during the campaign period of the June 3 2017 elections, were incorporated.
Among other measures aimed at reducing expenditure, “ministers and equivalent ranks would no longer fly first class”.
“Ministers will no longer travel for more than seven days without express permission of the Prime Minister based on elaborate justification.”
Dr Majoro also said that ministers had to reduce the size of their delegations to international meetings to just the optimum numbers necessary for them to perform their duties effectively.
Procurement procedures for accommodation, hotel catering, international travel and other supplies would now be done through a new framework where government enters into contracts with suppliers at lower prices.
For its part, the government would expedite its “payment record with principal secretaries being surcharged for each late payment” to suppliers.
Dr Majoro also proposed to do away with the ministers’ entitlement to the plush Toyota Landcruisers and replace these with much cheaper utility vehicles with lower specifications.
Cuts would also be effected on telephone communications with ministers expected to rely less on normal voice calls which would be substituted with cheaper options including Skype, WhatsApp audio, FaceTime and other VoIP services.
“The Government Secretary, working through the Ministries of Communications and of Finance will introduce caps on call entitlements.
“Data roaming should normally be turned off and used sparely where critically needed. The Ministry of Communications will provide the requisite training for senior officials (in the use of cheaper communication options).”
He said government would ensure that ministries, departments and agencies including state-owned-enterprises would come up with strategies to deliver public services in cost-effective ways.
Government would also establish an independent mechanism for reviewing salaries and benefits for all political posts as a way to removing conflict of interest.
Apart from domestic instability, Dr Majoro said Lesotho’s economy has also been negatively affected by the ongoing economic slowdown in South Africa.
He intimated that the economic crisis in South Africa had impacted negatively on the employment of Basotho mineworkers who are important source of revenue through remittances. The South African economic slowdown had also adversely impacted Lesotho’s exports as well as the stability of Southern African Customs Union (SACU) revenues.
Lesotho relies heavily on SACU revenues to finance part of its spending.
The minister expressed hope that Lesotho’s economic woes would ease with the expected recovery in South Africa of 0.8 percent in 2017 and 1.6 percent in 2018 and also on the back of improvements in Lesotho’s mining and agricultural sectors.
