By Yusef Taylor, @FlexDan_YT
Minister of Finance and Economic Affairs, Hon Seedy Keita laid the 2023 Draft Budget at the National Assembly featuring a Budget Deficit of D3.93 billion Dalasis on 14th November 2022. The total Revenues and Grants estimated for 2023 are projected to exceed D31.4 billion while total Expenditure and Net Lending are expected to exceed D35.4 billion.
Budget deficit refers to the amount of funds that the government needs outside Revenue and Grants to fund its Expenditure and Net Lending. Whenever Revenue and Grants exceed Expenditure and Net Lending then the Gambia will register a Budget Surplus. This is yet to happen in recent times.
Early into the session, Hon Fatoumatta Njai of Banjul South almost stopped the whole process dead in its tracks. The outspoken Parliamentarian raised her placard to highlight that Point of Order 83 (2) of the National Assembly’s Standing Orders requires that the Minister should make an electronic copy available to the National Assembly members (NAMs) “at least one clear day before the day on which the draft budget statement is to be made”.
In reaction to this, Hon Speaker Fabakary Tombong Jatta made enquiries with the Clerks and announced that the IT Division of the National Assembly will share an electronic copy with all NAMs. After some deliberations between the Speaker, Hon Sulayman Saho and Hon Njai the session was allowed to proceed and the Minister tabled the 2023 Draft Budget. Standing Order 83 (2) provides an exemption that “where this is not possible, he or she shall state to the National Assembly the reason(s)”. This provision was relied upon to proceed with the tabling of the 2023 Draft Budget.
2022 and 2023 Budget Deficits
It can be recalled that the Budget Deficit for 2022 was pegged at D2.82 billion, however, this was revised upwards close to D4.47 billion in the Revised budget approved in late July this year. According to the 2022 Approved Budget passed towards the end of 2021, the country was expected to generate D29.87 billion in Revenues and Grants, however, the Finance Minister highlights that only D14.4 billion has been raised by the end of September 2022. With nine months gone only 48% of the projected Revenues and Grants have been raised.
The Approved Revised Budget for 2022 decreased the amount of Revenues and Grants down to D26.595. Similarly, the Revised 2022 Budget decreased the Government’s projected Expenditure and Net Lending from D32.15 billion to D31.06 billion in late July 2022.
It’s noteworthy to highlight that the Minister’s speech does not include Government’s Actual Expenditure and Net Lending to the end of September 2022. This would have been ideal for Parliamentarians to assess how Actual Revenue and Grants compare to Actual Expenditure and Net Lending.
The Gambia continues to receive less Grants than expected in 2022. The Finance Minister revealed that “only 30% of the projected yearly outturn of D13.6 billion” was collected in 2022. Minister Seedy adds that “the projected disbursement of budget support grants from the European Union of US$23 million and African Development Bank of US$7 million did not materialize”.
The combined Grants of US$30 million translate to D1.8 billion at a rate of D60 to a Dollar. This highlights that Government is struggling to collect Grants from International Partners.
In addition to this, Minister Keita explains that “the increase in global oil prices, leading to fuel subsidies to the tune of D1.3 billion as at the end September 2022, also contributed to the low revenue outturn”.
Tax and Non-Tax Revenues
Turning our attention to the country’s Tax Revenue collection performance in 2022, the Finance Minister’s detailed that only D8.2 billion has been collected in Tax Revenues in contrast to the projected D12.65 billion estimated at the end of 2021. Minister Keita notes that this represents “56% of the projected outturn for the 2022 fiscal year”.
“On Non-Tax Revenue, performance for the first three quarters of 2022 registered D2.2 billion against an end-year projection of D3.9 billion, representing 60% of the projected outturn for the year”.
Tax-Revenue refers to all the Government’s funds generated from taxes such as Employee Tax, Value Added Tax etc. On the other hand, Non-Tax Revenue refers to funds generated from other sources such as social security contributions, fines, penalties and forfeits.
The Economy has Grown by Half a Percent
The finance minister also highlighted that the Economy has grown by half a percent from 4.3% in 2021 to 4.5% in 2022. “Preliminary data estimates Real Gross Domestic Product (GDP) growth for 2022 at 4.5 percent. This is an expansion from a rate of 4.3 percent in 2021 when recovery from the pandemic was underway”.
According to the Approved 2022 Budget and the Approved Revised 2022 Budget, the GDP was projected to exceed D106.89 billion in 2021 and is expected to grow by D9.29 billion in 2022. This comes to a total projection of D115.18 billion in 2022. Similarly, the Draft 2023 Budget uses the same figure for 2022 and projects GDP to grow by D15.75 billion in 2023.
Investopedia describes “Gross domestic product (GDP) [as] the total monetary or market value of all the finished goods and services produced within a country’s borders in a specific time period”.
The Minister’s speech explains that “agriculture is projected to continue on the growth path reaching 6.6 percent in 2023- primarily supported by crop production and fishing and aquaculture”. Similarly, “the growth prospects for the industry sector is estimated to increase to 6.9 percent in 2023 up from 6.0 percent in 2022- mainly supported by electricity and mining and quarrying activities”.
Speaking to Parliamentarians of the Sixth Legislature, the Minister projected that “recovery in tourism, transport and storage, finance and insurance will enhance growth, with the sector growth projected to reach 4.0 per cent in 2023”. This is almost double the growth recorded of “2.4 per cent in 2022″.
Growth refers to an increase in size. So, if one had 100 cars in 2021 and it grew by 6 per cent in 2022 then the total number of cars in 2022 has increased to 106.
Soon after Minister Keita tabled the 2023 Draft Budget in Parliament, Parliamentarians shuttled to Ocean Bay Hotel at Capepoint for the commencement of a three days retreat with NAMs and Budget Experts. In total at least 33 of the 53 elected NAMs have been elected for the first time. The event organised by Civil Society Organisation Gambia Participates was well attended and is set to conclude on Wednesday 16th November 2022.
National Assembly Approves D923 Million Budget Cuts in Revised 2022 Appropriation
1 Comment
Please let the govt bring the new pay and grading scale. It’s the only solution to these hardships as civil servants.