By Thoboloko Ntšonyane
MASERU – The government will now buy directly from the manufacturers and cut out the suppliers in their procurement of goods, the move that had raised the eyebrows of the business community and some people.
Minister of Finance and Development Planning Dr Retšelisitsoe Matlanyane said this as she tabled her first maiden Mid-Term Budget Review (MTBR) statement for the 2022/23 fiscal year in the National Assembly on Friday last week.
Dr Matlanyane said the government will adopt this uncommon move in order to save costs.
The Minister pointed out that the government will “reduce [the] cost of doing business in Government by centralising procurement through tendering; direct purchase from manufactures for essential goods and equipment; rationalise fleet and project implementation units.”
Many analysts fear that the government will not be able to maximize the tax collection through the Revenue Services Lesotho as there will be less business activity for the local suppliers. Not only will the local businesses suffer, it is also feared that more of the government’s money is likely to cross the borders instead of circulating in the country to grow the economy.
The former Minister of Finance Hon Thabo Sophonea when tabling the budget earlier this year had pointed out that there is a need to “Navigate the New Norm towards Transformation and Economic Recovery”.
“The MTBR is one of the important tools that foster accountability in public financial management. It is a framework for reporting and providing feedback to this Honorable House and to the nation on the utilization of fund that were allocated to the Administration (sic).
“It articulates the mid-year performance of the economy and the budget as well as adjustments that were made in response to emerging challenges. It also underscores adjustments to the proposed revenue and spending estimates for the remaining part of the year, while also providing an update on how the Government perceives the present economic conditions,” she said.
The Minister told the august house that the country continues to suffer economically due to the declining transfers from the Southern African Customs Union (SACU) as a result of the COVID-19 pandemic and the ongoing Russia-Ukraine war.
She added: “The Government’s medium-term priority is to implement economic reforms by, among others, increasing inclusive and sustainable economic growth and through enhancing private sector participation in production and job creation; strengthening human capital development as well as enhancing transparency and accountability of public institutions; promoting regional collaboration to ensure resilient infrastructure development and renewable energy generation and accelerating and implementing the necessary reforms to buttress stability.
“Through these and other measures, the government will further improve policy certainty and investors’ confidence, thus strengthening the resilience of the economy and indeed making Lesotho an attractive investment destination.”
Dr Matlanyane further highlighted that there is a need to “sacrifice” in order to raise more domestic resources to enable financing development projects. She said they will improve the growth and do away with the reliance on SACU receipts.
Meanwhile, the attempts to get a reaction from the Lesotho Chamber of Commerce and Industry (LCCI)’s Economic Advisor Chabeli Ramolise proved futile as his mobile was not answered at the time of going to the print last night.
Govt to procure directly from manufacturers
Thoboloko Ntšonyane
MASERU – The government will now buy directly from the manufacturers and cut out the suppliers in their procurement of goods, the move that had raised the eyebrows of the business community and some people.
Minister of Finance and Development Planning Dr Retšelisitsoe Matlanyane said this as she tabled her first maiden Mid-Term Budget Review (MTBR) statement for the 2022/23 fiscal year in the National Assembly on Friday last week.
Dr Matlanyane said the government will adopt this uncommon move in order to save costs.
The Minister pointed out that the government will “reduce [the] cost of doing business in Government by centralising procurement through tendering; direct purchase from manufactures for essential goods and equipment; rationalise fleet and project implementation units.”
Many analysts fear that the government will not be able to maximize the tax collection through the Revenue Services Lesotho as there will be less business activity for the local suppliers. Not only will the local businesses suffer, it is also feared that more of the government’s money is likely to cross the borders instead of circulating in the country to grow the economy.
The former Minister of Finance Hon Thabo Sophonea when tabling the budget earlier this year had pointed out that there is a need to “Navigate the New Norm towards Transformation and Economic Recovery”.
“The MTBR is one of the important tools that foster accountability in public financial management. It is a framework for reporting and providing feedback to this Honorable House and to the nation on the utilization of fund that were allocated to the Administration (sic).
“It articulates the mid-year performance of the economy and the budget as well as adjustments that were made in response to emerging challenges. It also underscores adjustments to the proposed revenue and spending estimates for the remaining part of the year, while also providing an update on how the Government perceives the present economic conditions,” she said.
The Minister told the august house that the country continues to suffer economically due to the declining transfers from the Southern African Customs Union (SACU) as a result of the COVID-19 pandemic and the ongoing Russia-Ukraine war.
She added: “The Government’s medium-term priority is to implement economic reforms by, among others, increasing inclusive and sustainable economic growth and through enhancing private sector participation in production and job creation; strengthening human capital development as well as enhancing transparency and accountability of public institutions; promoting regional collaboration to ensure resilient infrastructure development and renewable energy generation and accelerating and implementing the necessary reforms to buttress stability.
“Through these and other measures, the government will further improve policy certainty and investors’ confidence, thus strengthening the resilience of the economy and indeed making Lesotho an attractive investment destination.”
Dr Matlanyane further highlighted that there is a need to “sacrifice” in order to raise more domestic resources to enable financing development projects. She said they will improve the growth and do away with the reliance on SACU receipts.
Meanwhile, the attempts to get a reaction from the Lesotho Chamber of Commerce and Industry (LCCI)’s Economic Advisor Chabeli Ramolise proved futile as his mobile was not answered at the time of going to the print last night.