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Government is expected to pay K25.7 billion of taxpayer’s money in compensations for terminated contracts and dishonoured projects.
According to a document titled 2014/15 Budget Presentation, Accountant General Vote 271, which was presented before the Parliament Cluster Committees of the Public Accounts, the Budget and Finance and the Government Assurances committees.
“This is Statutory Payments for tax refunds, losses during the year and the previous financial year, and arrears for suppliers of goods and services such as Local Government Ifmis supplier, passport system and compensations for court cases estimated at MK25, 700, 919, 853.00,” reads the document.
It adds that government will have to pay K24.9 billion in monthly pensions and gratuities “due to increased number of retirees in the coming financial year [that is] ageing civil servants and arrears to pensioners.”
A member of the Public Accounts Committee (Pac), Peter Dimba, responding to the Accountant General’s (AG) budget presentation on Friday, wondered whether the office of the AG provides enough fiscal advice to governments, especially politicians, on the implications of some decisions which result into court litigations.
“Most of the dismissals are just political retaliations and huge compensations follow them. What kind of advice, if any, do you give to us politicians regarding cases of firing public officers?” queried Dimba.
During the meeting with the cluster committees, the Accountant General also indicated that K80.4 billion has been budgeted for repayment of interests on both domestic and foreign loans owned to various lenders.
“There is also need for a development budget of K1billion of which K500 million will be for payment to the supplier for construction of a Regional Treasury Cashier Centre while another K500, 000, 000 will be used for procurement of a new Ifmis system,” reads the document.
It also discloses that initially, the construction of the Treasury centre was budgeted at K102.5 million but jumped to K500 million representing a 79 percent increase because the initial supplier abandoned the site due to non-payment of funds.
Meanwhile, the department of the Accountant General is expected to meet today to answer more questions from members of the public accounts cluster committees after which legislators will discuss the unforeseen expenditures provision.
