Wednesday, 28th February, 2018

Wednesday, 28^th February, 2018

The House met at 1430 hours

[MR SPEAKER in the Chair]

NATIONAL ANTHEM

PRAYER

______

MINISTERIAL STATEMENT

STATUS OF IMPROVED RURAL CONNECTIVITY PROJECT

The Minister of Housing and Infrastructure Development (Mr Chitotela): Mr Speaker, I thank you for giving me the opportunity to issue a ministerial statement on the status of the Government’s programme to rehabilitate and maintain primary feeder roads in rural areas across the country under the Improved Rural Connectivity Project (IRCP).

Sir, the main objectives of the IRCP is to improve rural connectivity and access to rural areas through the rehabilitation and maintenance of primary feeder roads in order to ease the movement of people, goods and services. The successful implementation of the project will, therefore, enhance agricultural productivity and value addition. This will ultimately contribute to the reduction in poverty and vulnerability, and improved livelihoods of people in rural areas. This is in line with the aspirations that we, as a nation, have set in the Seventh National Development Plan (SNDP) and Vision 2030.

Mr Speaker, statistics indicate that 72 per cent of the primary feeder road network of the country is in a bad state. To address the situation of bad feeder roads, the Government has formulated the Road Maintenance Strategy, covering the period 2015 to 2024. The strategy primarily focuses on the primary feeder road network in rural areas, covering a total distance of 15,333 km across the country. The rationale for the strategy is to enable the Government to streamline road rehabilitation and maintenance activities, and to have full appreciation of strategies to be employed and the amount of resources required to address the problem of a poor feeder road network in the country.

Sir, with this plan in place and taking into consideration the limited fiscal space, the Government engaged the World Bank in discussions on the financing of the Road Maintenance Strategy. The discussions were followed by project planning and negotiations. In April, 2017, the World Bank Board of Directors approved US$200 million credit towards Zambia’s Road Maintenance Strategy through the IRCP.

Mr Speaker, the IRCP is, therefore, the vehicle through which the rehabilitation and maintenance of feeder roads will be implemented. Out of the total credit of US$200 million, US$20 million will go towards capacity building and the remainder will go towards the rehabilitation and maintenance of about 4,300 km of selected feeder roads across the country using the Output and Performance-Based Road Contracting Model.

Sir, US$200 million is quite a significant investment and represents the World Bank’s single biggest support to Zambia. However, in the road sector, this amount of investment is not substantial, as it falls far below the Government’s requirement to rehabilitate and maintain the 15,333 km primary feeder roads across the country as envisaged under the Road Maintenance Strategy. Given the limited amount of resources in relation to the needs, an objective and multi-criteria process was adopted in selecting the provinces, districts and roads to benefit from the intervention under the World Bank support. The factors taken into account in the selection process included the following:

poverty incidence levels;

agricultural productivity volumes;

agro-business potential; and

rural accessibility.

Mr Speaker, after the selection, the provinces were ranked as follows:

Central;

Eastern;

Northern;

Luapula;

Southern;

Muchinga;

Western;

North-Western; and

Lusaka.

Sir, in line with the agreed criteria, the funds from the World Bank will go towards road works in six provinces, namely Central, Eastern, Northern, Luapula, Southern and Muchinga. Further, the Government has committed to providing parallel funding to the project in the remaining four provinces, namely Western, North-Western, Copperbelt and Lusaka.

Hon. UPND Members: Ah!

Mr Chitotela: Mr Speaker, I wish to inform this august House that works in the six provinces under the World Bank funding will commence this year while those in Government-supported provinces are expected to commence next year.

Hon. Opposition Members: Ah!

Mr Chitotela: The works are expected to run for a period of five years, while the contracts will have a duration of five years. Two years is meant for rehabilitation works, while the last three years will be for maintenance works.

As I stated earlier on, the works under the IRCP will be carried out using the Output and Performance-Based Road Contracting which is a model primarily based on the contractor’s ability to perform. This approach transfers much of the risk associated with construction works to the contractor as opposed to the traditional methods where the client assumes most of the risk. Under this model, the contractors are expected to design the road, prepare the competitive costing and execute works.

Sir, in order to expedite the process, three consultants were engaged to carry out the following activities:

(a) survey the roads in all the provinces to select road sections to be included in the contracts;

(b) define the service levels expected from the contractors;

(c) package road sections by contract;

(d) develop bidding documents; and

(e) prepare conceptual designs for the works.

Sir, I am happy to report that the selection of roads for Central and Eastern provinces has been completed. In Central Province, works will soon commence, starting with two districts, namely Chibombo and Mkushi. In Eastern Province, the selected roads are in Vubwi, Lundazi, Petauke, Sinda, Chadiza, Katete and Chipata districts.

Mr Sing’ombe: Ah, All those!

Mr Chitotela: In addition, bidding documents for the two provinces have been submitted. Once the bidding documents have been reviewed, bids will be invited from the members of the public by the beginning of April this year.

The road selection process and other preparatory work in the other provinces is still ongoing and, once the process is completed, the members of the public will be informed accordingly. We expect the process to be completed by June so that we can start the tendering process by August.

In accordance with the World Bank guidelines, the tendering process for the works will be competitive and will involve both local and international contractors. As the Government, we acknowledge that the majority of local contractors may not be familiar with the mode of contracting that will be used in this project. So, to ensure that the local contractors are well informed and compete favourably, sensitisation meetings with the local contractors in all the provinces have been held. Further, the Government intends to facilitate more sensitisation meetings so as to reach all the potential contractors and financial institutions such as banks and insurance companies that provide support to contractors.

Mr Speaker, as I conclude my statement, I wish to inform the nation that the work to be undertaken is not limited to the rehabilitation and maintenance of feeder roads, but extends to works on agriculture support infrastructure such as storage sheds, boreholes and market shelters, among others, as part of the efforts to support the local community and agriculture production.

Sir, the sensitisation programme for the local leadership in the areas where works will be executed are also ongoing to ensure that the communities are fully aware and ready to participate in the project. We are hopeful that the project will yield the intended results and contribute significantly to improving the welfare of the people.

The project will not only contribute to agriculture production in significant ways, but also help to create about 25,000 direct jobs for the local people in the project areas for the period of its implementation. As the Government, we are focusing more on job creation, hence our resolve to encourage the use of labour-based technologies in the execution of the works.

As the Government, we remain resolved to continue on the path of wealth creation and prosperity for all the citizens of this great nation. We believe this is achievable, given the support of our people and our commitment to deliver that which we have promised our people.

Mr Speaker, I thank you.

Hon. Government Members: Hear, hear!

Mr Speaker: Hon. Members are now free to ask questions on points of clarification on the statement given by the hon. Minister of Housing and Infrastructure Development.

Dr Kalila (Lukulu East): Mr Speaker, there is no doubt that poor road network is one of the barriers to poverty eradication. Therefore, any decision to rehabilitate or improve the feeder road network must be based on poverty levels. For this reason, I would like to find out from the hon. Minister whether it was prudent to start this project in the provinces that he has mentioned and state whether the poverty levels are lower in these provinces as compared to the Western Province, particularly Lukulu, where he knows that there is an outstanding issue of the Katunda/Lukulu/Watopa Road. Why did he not start with this road and Lukulu District?

Mr Sing’ombe: Hear, hear!

Mr Chitotela: Mr Speaker, I acknowledge the concern by the hon. Member of Parliament for Lukulu East. However, I would like to remind him that the Katunda/Lukulu/Watopa Road does not fall under the category of primary feeder roads.

As I stated earlier on, in 2015, the World Bank commissioned and appointed a consultant who listed all the ten provinces of Zambia as potential areas for the project to be implemented in. The major factors taken into consideration in the selection process were poverty, volumes of agriculture production, agro-business potential and rural accessibility.

However, I agree with him that the Western Province is second from the bottom in terms of poverty levels after Luapula Province which is at the bottom. That is why the Government has committed itself to taking up the other part of the financing mechanism. If the hon. Member of Parliament may recall, in the Budget Speech for last year, the hon. Minister of Finance stated that we shall work on 10,000 km of the feeder roads this year. So, the remaining 5,600 km in the four provinces, namely Western, North-Western, Copperbelt and Lusaka will be financed by the Government of the Republic of Zambia.

Mr Speaker, I thank you.

Mr Kundoti (Luena): Mr Speaker, in the Western Province, be it Luena, Liuwa or Nalolo where the Vice-President comes from, there are no feeder roads that one can point at. The feeder roads being refereed to are actually bush paths created by scotch carts. For this reason, I would like to find out from the hon. Minister which feeder roads he is going to rehabilitate in the Western Province.

Mr Chitotela: Mr Speaker, I may not have the names of the feeder roads at the moment, but the Government has presence everywhere in Zambia. There are provincial roads engineers and district roads engineers in all the provinces. So, roads engineers, working with the local leadership, that is, councillors and area Members of Parliament, should be able to come up with some semblance of roads in the Western Province that need to be worked on.

Sir, as earlier stated by the hon. Member of Parliament for Lukulu East, the Western Province is part of Zambia and the poverty levels there are very high. So, we cannot fail to go there because there are no roads. The Government has the responsibility to construct roads where there are no roads in the Western Province.

I thank you, Sir

Mr C. M. Zulu (Luangeni): Mr Speaker, the hon. Minister said that out of the US$200 million from the World Bank, US$20 million will go towards capacity building. I would like to know what activities constitute the capacity building the hon. Minister has referred to.

Mr Chitotela: Mr Speaker, the US$20 million is for activities such as purchasing vehicles for the five implementing ministries that are chaired by my ministry. We have also created a secretariat to which two staff from the World Bank have been attached. The secretariat is headed by the Chief Planner, Mr Sekeseke, in the Ministry of Housing and Infrastructure Development. The officers from the World Bank have been going round the country meeting contractors and conducting workshops.

Sir, as I stated in my statement, after the meetings, there will be a National Symposium to which contractors will be invited. Of course, the acquisition of equipment to support the full implementation of the project is cardinal. It is for this reason that the World Bank provided US$$20 million for capacity building.

I thank you, Mr Speaker.

Mr Mung’andu (Chama South): Mr Speaker, I would like to thank the hon. Minister for the well-delivered statement.

Sir, have hon. Members of Parliament been consulted in the identification of feeder roads to be worked on in order to avoid creating white elephants or working on roads that might not be a priority in the rural areas since the Government is focused on opening up the rural areas? Has the Government involved the people’s representatives in the identification of feeder roads?

Mr Chitotela: Mr Speaker, the Ministry of Local Government is part of the secretariat. If my memory serves me right, the hon. Minister of Local Government requested hon. Members of Parliament to submit the names of feeder roads that need rehabilitation. The World Bank has also appointed consultants who are working in collaboration with the local authority and councillors. If my brother, the hon. Member for Chama South, did not submit the names of feeder roads in his constituency, I would like to urge him to go and see the hon. Minister of Local Government because the consultants are almost concluding their work in Muchinga Province. By the end of June, 2018, the consultants should have covered ten provinces.

I thank you, Sir.

Mr Mwiimbu (Monze Central): Mr Speaker, I would like to find out from the hon. Minister what measures he has put in place in a number of provinces prior to the commencement of the World Bank-funded project. He is aware that there have been floods in Lusaka, Central, Eastern, Western and Southern provinces. I heard him say that this project will commence in the Southern Province sometime in August. What measures is the ministry putting in place to ensure that the roads are passable before the project takes off?

Mr Chitotela: Mr Speaker, last week, I talked about the road network in Kalomo. I stated that the Government has the responsibility to ease the movement of people. We have continued releasing funds to the provincial administrations so that they can carry out emergency works. It is not just the Southern Province that has experienced floods, but also provinces like Luapula, Muchinga, Eastern, Copperbelt and Lusaka. So, whenever we are funded we, at least, release some money to the provinces so that they can attend to emergences because we cannot wait until the commencement of the project. Therefore, I would like to urge hon. Members of Parliament to engage the provincial administration whenever there is an emergency.

I thank you, Sir

Mr Nanjuwa (Mumbwa): Mr Speaker, I would like to thank the hon. Minister for the statement. The people of Mumbwa are excited to hear that the Central Province is one of the beneficiary provinces. However, I would like to find out from him whether this means that all the districts in the mentioned provinces will benefit from the fund.

Mr Chitotela: Mr Speaker, I outlined the criterion used to select the beneficiaries in the districts and provinces. For instance, variables such as poverty incident, volume of agriculture produce, agro-business potential and rural accessibility are taken into consideration in the selection process. I also stated that consultants have been engaged and are going round the provinces. So, if Mumbwa and other districts will qualify based on the criterion that has been set, they will be picked by the consultants who are going round.

I thank you, Sir.

Mr Nkombo (Mazabuka Central): Mr Speaker, I would like to tag on the by the hon. Member for Chama South.

Sir, not long ago, the then hon. Minister of Energy, Mr Mabumba, summoned us to the Amphitheatre to explain some issues relating to energy. We asked his colleague, the hon. Minister of Transport and Communication to do the same on the communication towers. He told us which sites require towers in our respective constituencies. The hon. Minister has asked the hon. Member for Chama South to submit the list of feeder roads to be worked on to the Ministry of Local Government if he has not done so. I wish to request him to compile a list of the target roads so that we could have an input in the compilation of the final list because we know the constituencies that we represent better than the consultants who are going round the country. Could that information be availed to us.

Mr Chitotela: Mr Speaker, we are a co-ordinating ministry, while the Ministry of Local Government is a client ministry. Again, I remember the hon. Minister of Local Government requested all the hon. Members to submit the list of feeder roads that needed to be worked on. It is for this reason that I am appealing to hon. Members who did not submit the list of feeder roads to do so. The ministry can only come up with a schedule after hon. Members have submitted the names of feeder roads to local authorities. The consultants will then look at how each road has been picked. Thereafter, we will come up with the information that the hon. Member has requested for.

Sir, in the event that the hon. Member did not submit the list of feeder roads in his constituency, but his province is among the beneficiary provinces, he can submit it to the Ministry of Local Government because my ministry is still receiving names of feeder roads to be worked on from the Ministry of Local Government. There is a window now for the hon. Member to submit the list. If the Southern Province has not yet been fully captured by the consultants, the hon. Member can submit the list of roads to the Ministry of Local Government, and it will be handed over to the consultants. Thereafter, it will be included on the schedule if it meets the criterion set by the World Bank. So, we will make that information available.

I thank you, Sir.

Mr Muchima (Ikeleng’i): Mr Speaker, when I heard about Zambia getting US$200 million from the World Bank for rural road rehabilitation, I thought this was the time all the provinces that are most affected would be taken care of. Like Hon. Dr Kalila said, statistically, Luapula, North-Western and Western provinces are the poorest in the country. However, the hon. Minister has told us that the North-Western Province is not part of this project. Why is it that from the time this Government came into power, the North-Western and Western provinces are left out of the projects being implemented?

The hon. Minister talked about the construction of 4,000 km of township roads countrywide, but we have not seen any township roads being constructed in the North-Western Province. We are among the provinces to be considered later. In view of this, is the hon. Minister sure that this broke Government will find money to construct feeder roads in the four mentioned provinces when it is struggling to disburse the Constituency Development Fund (CDF)?

Interruptions

Mr Chitotela: Mr Speaker, the North-Western Province has not been left out of this project. I wish to assure the people of that province that this Government takes a keen interest in the development of all parts of Zambia, including the North-Western Province.

Interruptions

Mr Chitotela: Sir, I had a meeting with the former hon. Minister of Finance and some officials from the World Bank, and we agreed that part of the conditions for this project is that counterpart funding from the Government would be made available so that the other four provinces that have been left out of the World Bank are catered for. So, the people in the four provinces should be assured that they will benefit from the construction of 5,600 km of feeder roads with funds provided by the Government. The World Bank is only targeting 4,300 km of feeder roads in the other provinces. So, there is no need for the people of the North-Western Province to feel left out because the poverty levels in Luapula, Western and North-Western provinces are almost the same and we want to bring development and equity to every part of Zambia.

Mr Speaker, I thank you.

Mr Jere (Livingstone): Mr Speaker, year in and year out, we see bridges on feeder roads collapsing. Has a comprehensive assessment been made in order to determine the lifespan of the bridges to avoid inconveniencing people, especially during the rainy season?

Mr Chitotela: Mr Speaker, the hon. Member has brought in the issue of bridges, yet we are dealing with the Improved Rural Connectivity Project. As a bonus answer, I would say that we have engineers who go around inspecting the lifespan of bridges in the country. At the moment, we are working on the Kafue Hook Bridge on the Mumbwa/Mongu Road. Our engineers established that the lifespan of the bridge was coming to an end. We will engage a contractor to put up a new bridge or rehabilitate the old one. When our engineers identify any faults on a particular bridge, they alert us not to allow people to use bridge it. So, we have the capacity to monitor bridges and get feedback.

I thank you, Mr Speaker.

Mr Kambita (Zambezi East): Mr Speaker, the hon. Minister is aware of the state in which the roads from Chitokoloki, Mpidi and Nyilamba up to Chizonzu and Dipalata, Nyakuleng’a up to Katontu are. Therefore, it makes me really sad when I hear him talk about the allocation of funds from the World Bank to some provinces, leaving out the North-Western Province and three other provinces. These are being catered for by the Government although we have not yet seen any works being carried out. Could the hon. Minister give me an assurance so that I, too, can go and assure the people of the North-Western Province that the Government will allocate money towards the construction of roads in the province?

Mr Chitotela: Mr Speaker, I wish to assure the hon. Member that the people of the North-Western Province will be taken care of and I have discussed this matter with my team at the ministry and the hon. Minister of Finance. We have decided that once the World Bank provides funding for this project, funds from the Government may not be applied in the provinces that are being funded by the World Bank. We want to take the counterpart funding from the Government to the provinces that are not being funded by the World Bank so that no part of Zambia is left out.

Sir, I know very well that the people of the North-Western, Western, Copperbelt and Lusaka provinces will not be left out in as far as this project is concerned. They will benefit from the funds provided by the Government. We will ensure that the Government’s funding is concentrated in the four regions so that we can also bring the feeder roads to acceptable standards.

Mr Speaker, we understand that we can only fight poverty if we make farming areas accessible so as to give farmers access to markets for their produce. I wish to assure the hon. Member that any funding from the Government of the Republic of Zambia (GRZ) for rural roads will be concentrated in the remaining four provinces.

I thank you, Sir.

Mr Mweetwa (Choma Central): Sir, from the outset, allow me to express my anxieties with the hon. Minister’s statement and say that it is hard for me to believe what he is saying. This is because the Government has made many promises, but has failed to fulfil most of them, yet hon. Ministers come here to tell such ‘romantic stories’ that somebody listening from outside might think this is a working Government.

Sir, the hon. Minister is aware that the Public Accounts Committee (PAC) undertook a trip to audit roads about which the Government misinformed the nation that rehabilitation works had commenced prior to the last General Elections. This includes the Chipata/Vubwi Road in Eastern Province and Chirundu via Chiawa Road. The Hon. Minister is aware that many of the road projects have stalled. There is no work …

Mr Speaker: Order!

Hon. Member for Choma Central, are we still on the same subject of feeder roads to be funded by the World Bank? If we are, ask a question by way of clarification. It seems we are now having a discourse on the findings of my Public Accounts Committee’s (PAC) and so on and so forth.

Laughter

Mr Speaker: Please, focus on the ministerial statement.

Mr Mweetwa: Sir, that was just an attempt to contextualise my question to make it logical. I was concluding with my prelude by saying that the stalled projects are accumulating huge interest fees, including stand-in-time. Why is the Government failing to mobilise funding for the projects that have stalled, yet it is now mobilising funding for new projects? That is why I have difficulty taking the hon. Minister’s words seriously.

Mr Chitotela: Mr Speaker, this is a working Government. That is why there are township roads in Vubwi today. So, people should not misinform the House that a contractor is not working on the road between Feni Sub-centre and Vubwi. The area hon. Member of Parliament can attest to the fact that the contractor is on site. There was a request that the contractor starts with township roads in Vubwi District. At the moment, township roads in Vubwi District are of bituminous standard. That is how committed we are.

Hon. Government Members: Hear, hear!

Mr Chitotela: The projects that we have been able to implement with the help of the international community are a clear demonstration of the amount of confidence that the international community has in this Government. The US$200 million is the largest investment the World Bank has ever made in Zambia. So, we shall ensure that this project is implemented for the good of the people of the Southern Province, for instance, including Choma. Choma is one of the districts that are going to benefit from this project. Therefore, the people of the Southern Province will be able to tell who genuinely cares about their interests between one who is politicking and one who is providing services.

Hon. Government Members: Hear, hear!

Mr Speaker: Hon. Minister, I just want to be clear in light of the question by the hon. Member for Choma Central. Of course, he could have been brief, but his simple question was: Did you have an opportunity to decide together with the donor whether you should attend to the outstanding roads or was there a different criterion and approach in the application of the US$200 million?

I think that was his question. Of course, he asked it in a roundabout way, and that is why you were, maybe, caught in a snare.

You may answer the question, hon. Minister.

Mr Chitotela: Mr Speaker, the Patriotic Front (PF) launched two road projects. We started with the Link 8,000 km Road Project and the Pave Zambia 2,000 km Road Project. The Improved Rural Connectivity Project is a different one. We requested the World Bank to secure funding for it. We want to implement this project because we do not want the rural areas lag behind in terms of development.

I thank you, Sir.

Mr Speaker: Hon. Members, avoid long-winding questions because they just confuse matters. Just get to the point. Some of the long-winding questions have a boomerang effect.

The hon. Member for Kabwe Central may ask his question.

Mr Ngulube (Kabwe Central): Mr Speaker, the hon. Minister mentioned that some feeder roads in Chibombo will be worked on. When he gave a ministerial statement last year, he indicated that the Government had started working on Piccadilly Road. This was going to ease the movement of farmers in the province. I wish to know the status of Piccadilly Road because it is one of the feeder roads that connect almost five districts.

Mr Chitotela: Mr Speaker, Piccadilly Road is not being rehabilitated under the programme for rehabilitating feeder roads. The Government has signed a contract with an Italian company to upgrade Piccadilly Road to bituminous standard under the Engineering Procurement and Construction plus Finance (EPC+F) Model and the term sheet for negotiating funding has been submitted to the Ministry of Finance.

I thank you, Sir.

Mr Lufuma (Kabompo): Mr Speaker, no road has been constructed under the Link 8,000 km Road Project in the North-Western Province. Also, not a single township road has been constructed in the North-Western Province. There has been no mention of feeder roads to be constructed under the Improved Rural Connectivity Project in the North-Western Province. My problem is that whenever funding for road projects is secured from organisations, the North-Western Province is always left out. The North-Western Province is only included in the road projects that are funded by the Treasury. The structure of the 2018 Budget is such that only 10 per cent of it is allocated towards infrastructure development. Would it be prudent to put together the funds from the World Bank for road projects and those from the Treasury so that no province is left out? We, in the North-Western Province, feel left out. We know that the Treasury will not have enough money for road works, as promised by the Government.

Mr Chitotela: Sir, allow me to set the record straight. Funding worth K2.4 billion has been secured from the National Pension Scheme Authority (NAPSA) for the construction of the Chingola/Solwezi Road. We are waiting for the contractor to submit the interim payment certificates. Further, the Mwinilunga/Ikeleng’i/Jimbe Road is also being worked on under the Engineering Procurement and Construction plus Finance (EPC+F) Model. The Government is also upgrading township roads in Solwezi and Mwinilunga to bituminous standard. We had also started upgrading township roads in Zambezi District, but the project has stalled. We have also worked on the township roads in Chavuma. All these districts are in the North-Western Province. Therefore, the hon. Member has misled the nation by saying that the Government has neglected the North-Western Province.

The World Bank sent a team of officials to Zambia to look at how the rural Improved Rural Connectivity Project would be implemented. The total amount allocated towards road infrastructure under the Ministries of Defence, Local Government, and Housing and Infrastructure Development in the 2018 Budget is over K12 billion. We need to improve domestic resource mobilisation so as to implement road projects. I wish to assure the people of the North-Western, Western, Lusaka and Copperbelt provinces that we will not leave them out. The project of constructing feeder roads is going to be spread across the country in order to benefit every Zambian.

I thank you, Sir.

Mr Sing’ombe (Dundumwezi): Mr Speaker, last year, His Excellency the President went to break ground for the construction of Dundumwezi Road. What is the current cost of constructing a gravel road per kilometre?

Mr Chitotela: Mr Speaker, I have not looked at the cost of constructing a gravel road per kilometre. I have provided information on the cost of constructing roads using bitumen, asphalt and double chip seal. I can provide a response to that question when my team gives me the information.

I thank you, Sir.

Mr Miyanda (Mapatizya): Mr Speaker, in Central Province, two districts will benefit from the Improved Rural Connectivity Project funded by the World Bank. In the Eastern Province, six districts will benefit from this project. In the Southern Province, not all districts will benefit from this project. In the newly-created Zimba District, no road has been worked on since the liberation of Zimbabwe war. Can the hon. Minister assure me that Zimba District will benefit from this project?

Mr Chitotela: Mr Speaker, I hope that when the project was at assessment stage, Zimba fell under Kalomo District, which is one of the districts to benefit from this programme. The others are Choma and its outskirts. If that is the case, it will benefit as long as it meets the criteria applied by the World Bank.

I thank you, Sir.

Mr Kufakwandi (Sesheke Central): Mr Speaker, it is surprising that the World Bank consultants concluded that the Western Province is not one of the provinces with poor feeder road infrastructure. It is also surprising and hard to believe that in terms of infrastructure, the Western Province is being categorised with Lusaka. The Western Province has been waiting for feeder roads to be built since Independence. In my constituency, there is no feeder road that has been built since Independence, yet it meets the criterion that the hon. Minister talked about. Echoing Hon. Lufuma’s question, I was wondering why the Government is not using internal resources to construct feeder roads in the Western Province. The Government keeps telling us that the feeder roads will be constructed next year. Why can it not construct feeder roads in the Western Province this year, which is at the bottom rung of the ladder?

Mr Chitotela: Mr Speaker, what the hon. Member is suggesting is possible. However, that would depend on domestic resource mobilisation. That is why I said the other component of the funding is from the Government of the Republic of Zambia (GRZ). As a ministry, we are ready to start implementing this project once the Treasury makes the money. We can implement the project as early as March or May, 2018 because the Western Province is part of Zambia.

Mr Speaker, I thank you.

Dr Musokotwane (Liuwa): Mr Speaker, the hon. Minister seems to be totally under the captivation of the World Bank as if Zambia has no voice of its own to negotiate and decide what to spend the money on. I say so because if Zambia had that voice, surely, it would have made sense to tell the World Bank that part of the loan should go towards the construction of some roads in each province. That way, when the Government makes some money available, all the provinces would benefit. This is because we are not very certain about the availability of Government funds. Why did the Government not tell the World Bank the bare fact that this time around, every province must benefit from the money?

Mr Chitotela: Mr Speaker, this process has taken long to conclude. The Government has been discussing with the World Bank the need to distribute infrastructure development across the country. One of the conditions attached to the loan was that the Government should finance the remaining four provinces. We had a meeting with the hon. Minister of Finance and the World Bank Country Representative. At that meeting, the country committed itself to raising money and ensuring that as the World Bank Projects are being implemented, projects in the remaining four provinces would also be implemented using Government funding.

I thank you, Sir.

Ms Chisangano (Gwembe): Mr Speaker, this country’s motto is, “One Zambia, One Nation”. As such, no region should be left behind in terms of development. Some roads in rural constituencies like Gwembe have not been graded before. The footpaths that were made by our colonial masters and David Livingstone are the ones that are being referred to as feeder roads.

Sir, would the Government consider including in this project a constituency like Gwembe, which has never enjoyed the benefits of being part of a country that is independent, as the roads and other infrastructure are in a pathetic state?

Mr Chitotela: Mr Speaker, I stated that the hon. Minister of Local Government circulated correspondence to all hon. Members of Parliament, asking them to indicate which roads they wanted worked on in their various constituencies. I also stated that the World Bank consultants and Ministry of Local Government are going round the provinces to select roads that should be included in the project. The hon. Member of Parliament for Gwembe should take advantage of this window, which will last until June, to request that the roads that need to be worked be included on the list of those to be worked on. That is the best option. Lobbying the hon. Minister will not be helpful, as I will not be among the team that will go to the Southern Province to select the roads to be worked on. So, it is up to the hon. Member to influence her Council Secretary and ensure that the roads that she wants worked on are included on the list of selected roads.

Mr Speaker, I thank you.

Mr Speaker: We have been debating the ministerial statement for almost an hour. I know that the country is huge and the hon. Minister has indicated that the programme is not cast in stone. It is still open to discussion, particularly through the Ministry of Local Government. Over the last sixty minutes or so, I have noted that the questions are highly individualised and peculiar to the constituencies. Of course, a few policy questions have been advanced. In short, I will now begin winding down. The last question I will take is from the hon. Member of Parliament for Sikongo Parliamentary Constituency.

Hon. UPND Member: Hear, hear!

Mr Ndalamei rose.

Mr Speaker: Just a minute. Take your seat, hon. Member.

Laughter

Mr Speaker: I said you will ask the last question. I hope the information communications technology (ICT) section is following the proceedings. Going by my list, the hon. Member of Parliament for Sikongo will be the last to take the Floor, and I will allow this on account of equity. By the way, the ICT equipment is not gender sensitive, as it records names as they come. Maybe, we should develop a programme that identifies gender.

Mr Mulunda (Siavonga): Mr Speaker, despite the many promises relating to township roads in Siavonga, including the trunk road from Chirundu Junction to the dam wall, nothing has been done from 2013 when the Patriotic Front (PF) Government first promised to work on the roads. Could the hon. Minister confirm whether Siavonga will be one of the beneficiaries of the project in the Southern Province.

Mr Speaker: Hon. Member for Siavonga Parliamentary Constituency, are you talking about township roads?

Mr Mulunda: Mr Speaker, I meant feeder roads.

Laughter

Mr Speaker: No, no, no!

Laughter

Mr Speaker: What about feeder roads? I may not have heard. So, what did you say about feeder roads?

Mr Mulunda: Mr Speaker, the feeder roads in Siavonga have not seen the face of a grader. I have in mind roads from Siakalinda to Sianyolo, Dambwa to Sianyolo, Nabutezi to Munyama which have never seen the face of a grader. Could the hon. Minister confirm whether or not this time around, the grader will pass on the roads that I have mentioned.

Mr Speaker: I think I will save the hon. Minister from answering some questions.

Dr Imakando (Mongu Central): Mr Speaker, I am sure the hon. Minister is aware that the Western Province has Kalahari sands, which require four wheel-drive vehicles, and winding plains that make road transportation very expensive. One would have thought that the Western Province would have been considered as a special case to be funded by the World Bank. What assurance can the hon. Minister give the people of the Western Province, especially since he does not talk about the stadium, which the Government promised to build a long time ago, Lewanika University ...

Mr Speaker: Order!

Hon. Member for Mongu Central, you are supposed to ask a supplementary question. A supplementary question has a definition. It must be related to the subject under discussion. Therefore, when you start bringing in issues of stadia and hospitals, I will ignore all the questions so that we move to another item. We seem to have spent a lot of time on the statement and are now going out of bounce. Do you have a supplementary question?

Dr Imakando: Mr Speaker, the point is that the Government promised to put up infrastructure in the Western Province, and roads are infrastructure. Considering that some infrastructure is no longer talked about, what assurance is the hon. Minister giving the people of the Western Province that the roads will be funded from Government coffers when we know that this Government has no money?

Hon. Opposition Members: Hear, hear!

Mr Speaker: Hon. Member for Mongu Central, what is under discussion now is the World Bank project. Your question relates to Government coffers and the hon. Minister has made a very clear distinction between the two. There was a suggestion from the hon. Member for Kabompo that the Government puts them in the same basket, but the hon. Minister has already responded to that. If there are issues to do with Government funding, then, you can file in a question. What we are considering now is the special funding from the World Bank, and the hon. Minister has been very clear about that.

Ms Lubezhi (Namwala): Mr Speaker, the hon. Minister said that this is a completely new project, which definitely leaves out the Monze/Nico Road. When, then, will his ministry remove the anthills on that road because they are a potential hazard to road users?

Mr Chitotela: Mr Speaker, allow me to give the price per kilometre for feeder roads. It costs US$40,000 per kilometre which translates to K400,000 per kilometre. This is a special project which will run for five years. The project will have two years of rehabilitation and three years of maintenance in which the contractors will be liable to continue rehabilitating the roads.

Sir, the Nico/Monze/Namwala is a road, which we are upgrading to bituminous standard. So, it does not fall under the Rural Road Connectivity Project.

I thank you, Sir.

Ms Lubezhi: What about removing the anthills?

Mr Miyutu (Kalabo Central): Mr Speaker, the Rural Road Connectivity Project is funded from the US$200 million from the World Bank. The hon. Minister said the consultants working on this project came up with six provinces where they believe there is enhanced poverty. Apart from poverty, what factors have excluded the Western Province from being considered for this programme?

Mr Chitotela: Mr Speaker, not to speak for the consultants, some of the variables were poverty incident levels, agriculture production volumes, agro-business potential and rural accessibility. I do not know which one of the variables was taken into account. We need to ask the consultants why they did not include the Western Province but, instead, proposed that it goes under Government funding.

I thank you, Sir.

Mr Mutaba (Mwandi): Mr Speaker, how many kilometres of feeder roads will the Government work on in the Western Province in the second phase of the project?

Mr Chitotela: Mr Speaker, I do not have that information. I cannot tell until the information is made available by the team which is compiling the statistics.

I thank you, Sir.

Mr Chisopa (Mkushi South): Mr Speaker, the Government is working on township roads in Mwinilunga, Jimbe and Solwezi Central. The Government has also constructed the bridge in Kalabo which is in the North-Western Province ...

Hon. Opposition Members: Where?

Mr Chisopa: ... but, has left out Luano District.

Hon Opposition Member: It is not important.

Laughter

Mr Chisopa: Sir, are these selective programmes, political programmes or is the Government choosing according to need?

Mr Speaker: Hon. Member for Solwezi West.

Hon. Opposition Members: Hear, hear!

Laughter

Mr Kasonso (Solwezi West): Mr Speaker, the hon. Minister is misleading the House. I was in Solwezi last week and not a single kilometre of township road has been worked on in Solwezi apart from one trunk road which goes to Kasempa and Mwinilunga ...

Mr Speaker: Hon. Member for Solwezi West, whether you are right or wrong is neither here nor there. The opportunity I have given you is to ask a supplementary question on the World Bank project. That is what we are considering at the moment. Do you have any supplementary question on that subject?

Mr Kasonso: Yes, Mr Speaker.

Mr Speaker: Please, advance it.

Mr Kasonso: Sir, why is the hon. Minister discriminating against the people of the North-Western Province? They want to be part of the World Bank programme, and not the Government-funded programme.

Mr Chitotela: Sir, the North-Western Province has never been discriminated against.

Hon. Opposition Members: Ah!

Mr Chitotela: Facts are there for everybody to see.

Sir, the bridge at the hon. Minister’s residence has had its span expanded in order to pave way for the construction of the dual carriageway. The contract for the dual carriageway has been varied to accommodate this new development.

Mr Speaker, the people of the North-Western Province should know that funding from the Government of the Republic of Zambia (GRZ) is going to the province. So, they should not feel left out. The North-Western could not meet the criterion applied by the consultants from the World Bank.

I thank you, Sir.

Mr Ndalamei: Mr Speaker, can the hon. Minister explain why the Western Province has been left out of the World Bank programme.

Mr Speaker: The hon. Minister has already explained that.

Laughter

Mr Speaker: There was a criterion which he read out a while ago.

__________

QUESTIONS FOR ORAL ANSWER

196. Dr Chibanda (Mufulira) asked the Minister of Local Government:

(a) how many constituencies were not paid the 2017 Constituency Development Fund (CDF) in full;

(b) when the outstanding amount would be disbursed to all the affected constituencies;

(c) when the process of approving the 2017 CDF projects would be completed; and

(d) when the 2018 CDF would be disbursed.

The Minister of Local Government (Mr Mwale): Mr Speaker, I wish to inform the House that a total of 126 constituencies out 156 were not paid in full.

Sir, as per the Government Fiscal Policy, we do not carry over budgetary obligations from one fiscal year to the next year. However, the good news is that the Ministry of Finance has agreed to issue Supplementary Expenditure to enable us to disburse the balances this year. We hope that we will have budget over-performance.

Mr Speaker, CDF projects are approved based on submissions by individual constituencies through their respective councils. All the submitted proposals for 2017 were approved as soon as they were received at the ministry. However, some councils delayed in submitting their proposals, hence they are still being considered.

Sir, we are expecting the disbursement by the Treasury in the first quarter of 2018.

I thank you, Sir.

Mr Kambita (Zambezi East): Mr Speaker, I wish to inform the hon. Minister of Local Government that the disbursement of the Constituency Development Fund (CDF) is a very contentious issue. The hon. Minister has mentioned that the CDF for projects, which were approved by committees in various constituencies, were also approved by the ministry. However, to my surprise, I am getting some disturbing news from our constituencies that the District Commissioners (DCs) are interfering with the projects approved by the hon. Minister’s Office and claiming that they are following the President’s instruction to complete all outstanding projects before starting new ones. The CDF committees followed the criteria applied by the hon. Minister’s Office.

Mr Speaker, could the hon. Minister give me a position as regarding the interference by the DCs.

Mr Mwale: Mr Speaker, only the hon. Minister of Local Government can authorise the use of CDF as proposed by the CDF committee and approved by the District Development Co-ordinating Committees (DDCCs) to ensure that there is no duplication of projects because the Government also has other programmes to provide development in the same areas. DCs have no power whatsoever over CDF because there are regulations that guide the use of CDF.

Sir, the President issued a statement that we should consider completing old projects before we start new ones. I think that is a noble call and, as the Government, we are towing that line. This was advice given to various CDF committees and Government departments. However, that instruction came after most of the projects had been approved. The CDF committees will go by the projects that were approved unless they decide to change. The advice given by the President was important.

I thank you, Mr Speaker.

Mr Nkombo (Mazabuka Central): Mr Speaker, I would like to find out from the hon. Minister what criteria were used to pay out the balance of thirty constituencies out of the 156? I would like the hon. Minister to name the constituencies so that I can write them down since I have a pen and paper.

Mr Mwale: Mr Speaker, I have been updating this House on a regular basis on the disbursement of the Constituency Development Fund (CDF) when the disbursements began in May last year.

Mr Speaker, I placed Cabinet Ministers at the bottom of the list of those to receive the CDF. We said that if there is anybody who should not receive their CDF should the hon. Minister of Finance fail to disburse the CDF to all the constituencies, it would be the hon. Ministers. That is why we said we would be the last ones to receive the CDF. So, we decided to give all the constituencies 50 per cent of the CDF except the eighteen constituencies held by Cabinet Ministers. When we got funding at the end of the year for the eighteen constituencies, we paid them in full …

Interruptions

Hon. Opposition Members: Question!

Mr Mwale: Sir, whether you like it or not, I am being very frank. The hon. Ministers were ready to lose out should the CDF not be disbursed. When we began to pay the balance of 50 per cent, we started with hon. Ministers whom we paid in full so that we do one transaction. We paid thirty constituencies in full. I am not able to give full information on this, as this is a new question that I need to prepare for. Out the thirty constituencies that were paid in full, about fourteen were those represented by hon. Ministers who were did not get the initial 50 per cent of the CDF when the backbenchers got theirs. The constituencies were cut across the country. Our hope was that by the end of the year, everyone was going to be paid the full amount. However, the Ministry of Finance was unable to give us the funding. Nonetheless, it has committed to give us the funding this year.

I thank you, Mr Speaker.

Mr Mwiimbu (Monze Central): Mr Speaker …

Mr Nkombo: On a point of order, Mr Speaker.

Mr Speaker: I will allow points of order when we are done with this segment of the Order Paper.

That is my ruling.

Mr Ngulube: Hear, hear!

Mr Nkombo: Long live, Mr Speaker!

Mr Mwiimbu: Mr Speaker, the hon. Minister issued a statement to the effect that the money that the Constituency Development Fund (CDF) that was disbursed by the hon. Minister of Finance was diverted to activities meant to curb the cholera outbreak. This afternoon, the hon. Minister of Local Government has told us that the hon. Minister of Finance is going to bring a Supplementary Budget because the CDF cannot be rolled-over. In view of this, would the hon. Minister blame the constituencies and the hon. Members of Parliament for the non-release of funds and the issue of roll-over when it was his decision to divert the money that was made available by the hon. Minister of Finance?

Mr Mwale: Mr Speaker, no CDF was diverted to activities aimed at curbing cholera or anything of the sort. There was a question, …

Mr Mwiimbu interjected.

Mr Mwale: Yes, I know you are depending on …

Mr Speaker: Hon. Minister, do not be distracted. Just continue with your response.

Mr Mwale: Mr Speaker, I know that there were stories alleging that we diverted the CDF to other areas. I think that might have emanated from my statement that the hon. Minister of Finance was unable to disburse the CDF because there were issues of an emergency nature, such as cholera and the Electronic Voucher System (e-Voucher System), which were given priority. We did not receive the remainder of the CDF for us to disburse it to all the constituencies. There is no way we could have diverted money that we did not receive.

Mr Speaker, we sat with the then Minister of Finance, Hon. Mutati, who gave us a clear plan. He said that we should have received all the funding for all the constituencies by the end of last year. Unfortunately, other issues of an emergency nature came up. The ministry, then, stated that it would not be able to fund us due to other issues that came up and promised to give us money when it was going to be available. That is the reason Hon. Mwanakatwe is saying that she will bring a Supplementary Budget. I, therefore, wish to clarify that we did not receive money that was diverted to the fight against cholera or the e-Voucher System.

I thank you, Sir.

Mr Nanjuwa (Mumbwa): Mr Speaker, the Constituency Development Fund (CDF) is a tool for development in our various constituencies. The erratic release of the CDF creates a backlog of incomplete projects which run over a long period. Would the hon. Minister consider releasing the CDF in the first quarter of every fiscal year so that projects can be completed in the same year?

Mr Mwale: Mr Speaker, we would wish for that. As a ministry, our wish is that the CDF is released at the beginning of the year so that we can have a lot of time to implement projects. Let me also state that the CDF is not the only expenditure that the Government has to take care of. The hon. Minister of Finance has many priorities to take care of. So, this expenditure is treated like any other expenditure. We must actually give credit where it is due. Last year, the Ministry of Finance tried its best to release some funds. I am very sure that the ministry could have funded all the constituencies by December had it not been for other emergencies. We are hopeful that the hon. Minister of Finance will do the same this year, as she has promised that the ministry is going to try to release the CDF in the first quarter of this year.

I thank you, Mr Speaker.

Mr Kasandwe (Bangweulu): Mr Speaker, in some jurisdictions, when funds such as the Constituency Development Fund (CDF) are distributed, consider poverty levels are considered, constituency by constituency. From the response to the question by the hon. Member for Mazabuka Central, it is clear that the ministry has no policy on the distribution of the CDF. If poverty levels were to be considered in the selection of beneficiary constituencies, Luapula, North-Western and Western provinces would have been considered first. For instance, Mandevu Constituency receives other developmental support from the Central Government as opposed to Bangweulu Constituency. What factors does the hon. Minister take into consideration when allocating the CDF? I know that all the constituencies need the CDF, but poverty levels and needs vary. Why does the ministry not consider poorer constituencies first?

Hon. Opposition Members: Hear, hear!

Mr Mwale: Mr Speaker, I subscribe to that idea. The ministry is currently working on a formula that we should use to determine who gets what. This is the same formula that we are using for the Local Government Equalisation Fund (LGEF). Not all councils get the same amount of funding. We think that we should do the same for the CDF. By the way, we are on course in bringing the Constituency Development Fund Bill to this House this Meeting of the House. Once the Bill is passed, we should begin to take those variables into account. I really agree with the hon. Member’s suggestion.

I thank you, Mr Speaker.

Ms Lubezhi (Namwala): Mr Speaker, in his response, the hon. Minister said that thirty constituencies were paid their Constituency Development Fund (CDF) in full. It is not possible for him not to know the thirty constituencies. Will he be bold enough to tell us which constituencies they are.

Mr Mwale: Mr Speaker, the question by the hon. Member for Mufulira sought to find out the following:

how many constituencies were not paid the 2017 CDF in full;

when the outstanding amount would be disbursed to all the affected constituencies;

when the process of approving the 2017 CDF Projects would be completed;

and when the 2018 CDF would be disbursed.

Mr Speaker, I came adequately prepared to answer the above-listed questions. If the hon. Member wants me to respond to her question, I can easily get the information and give it to her some other time. For now, I am not ready to provide a response because I did not prepare for it.

I thank you, Sir.

Dr Chibanda: Mr Speaker, we know that there have been years that the Constituency Development Fund (CDF) has not been disbursed. I know that the hon. Minister has been having a tet-a-tet with the Ministry of Finance. So, I would like the hon. Minister to categorically state when the balances will be paid to the hon. Members. I know that he has mentioned the first quarter of 2018. Could the hon. Minister give the House a time frame of the disbursement of the balances since projects have stalled in our constituencies?

Mr Mwale: Mr Speaker, preparations for a Supplementary Budget to be presented to this House are underway. We can release this year’s CDF in time so that the Supplementary Budget can make up for last year’s shortfall. This will give us time to implement projects without disruption. We have to move a Supplementary Budget here to allow us to spend. So, we will release money to make up for the shortfall so that there is no disruption in the implantation of projects.

I thank you, Sir.

Mr Kintu (Solwezi East): Mr Speaker, we applied for the Constituency Development Fund (CDF) in December last year. I have been informed that the council application for the approved CDF Projects has not reached the hon. Minister’s Office, but Mushindamo District Council is has confirmed that it was sent. Where is the project proposal?

Mr Muchima: Where are the papers?

Laughter

Mr Speaker: Hon. Minister, where are the papers?

Laughter

Mr Mwale: Mr Speaker, I wish to request the hon. Member of Parliament to come to my office early in the morning tomorrow so that we can trace the documents. I must admit that we have had such challenges in some councils. Meanwhile, in other councils, things have been done smoothly, as project proposals are approved within a week or two. I wish to invite the hon. Member to come to my office so that we can trace the documents.

I thank you, Sir.

Mr Mbangweta (Nkeyema): Mr Speaker, does the hon. Minister find it ethical to give the people whom they are managing half of the Constituency Development Fund (CDF) and, then, give themselves the full amount?

Hon. UPND Members: Hear, hear!

Mr Mwale: Mr Speaker, I am very surprised with this kind of questioning. Hon. Ministers were placed at the bottom of the list for CDF while everybody here, including Backbenchers, received half the amount. Had the Ministry of Finance failed to disburse the CDF, hon. Ministers were ready to forego theirs. That is why they were put at the tail end of the list.

Interruptions

Mr Mwale: Then, the hon. Member did not raise the issue of morality. When we received the money, we decided to pay those we had made to wait in one transaction. When we did that, issues of morality arose. I also placed myself at the tail end of the list. So, I do not think the issue of morality should arise. We were ready to pay everybody by December, but were disappointed that the money was not disbursed. However, the Ministry of Finance is ready to finance the CDF projects and all the constituencies will get their allocation.

Mr Speaker, in 2014, only 104 constituencies received the full CDF. Some constituencies did not receive anything. This has happened before during the Movement of Multi-party Democracy (MMD) rule. However, this time, we decided to pay half the amount across the board so that each constituency could get something. In the past, some constituencies would get and others would not. Sometimes, by the end of the year, only fifty constituencies would have got their CDF. As the Government, we will ensure that every constituency receives its allocation of the CDF, and that is what is more important.

I thank you, Mr Speaker.

Hon. PF Members: Hear, hear!

Mr Mwene (Mangango): Mr Speaker, will the ministry take the same approach with the Constituency Development Fund (CDF) for 2018? Will we get half the amount and the hon. Minister get the full amount thereafter?

Mr Mwale: Mr Speaker, the Government is committed to giving every constituency its allocation of the CDF. It may be disbursed in different ways but, ultimately, every constituency will receive the full amount as promised by the Government.

I thank you, Sir.

Mr Kamboni (Kalomo Central): Mr Speaker, in the event that the money is not enough as was the case in 2017, can the hon. Minister assure us that the thirty constituencies that got their allocation of the Constituency Development Fund (CDF) 2017 first will be the last to get the CDF for 2018?

Laughter

Hon. UPND Members: Hear, hear!

Mr Mwale: It is very possible, Madam Speaker – sorry, Mr Speaker.

Hon. Opposition Members: Hear, hear!

Mr Mwale: Mr Speaker, we could start with the constituencies that have not received their allocation of CDF for 2017. However, I am very sure that every constituency will receive its allocation of CDF for 2017 before we disburse the CDF for 2018.

I thank you, Mr Speaker.

Mr Chaatila (Moomba): Mr Speaker, the Guidelines for the Constituency Development Fund (CDF) for 2006 that we are using are outdated. Does the hon. Minister plan to issue new guidelines and, if so, when?

Mr Mwale: Mr Speaker, we do not think that we should keep following the guidelines to disburse the CDF. Like I said earlier on, before the House rises, a Bill should be tabled so that we have the Constituency Development Fund (CDF) Act to guide us on how to disburse and manage the CDF. I do not think that we should continue using the guidelines that we have been using since 2006.

I thank you, Sir.

Mr Mwila (Chimwemwe): Mr Speaker, I would like to find out whether the ministry allowed the local authorities to proceed with the procurement processes for the 2018 Constituency Development Fund (CDF) even before the Treasury releases the CDF for 2017 or will it wait until the 2017 funds ‘hit’ our respective constituency accounts?

Mr Mwale: Mr Speaker, since the funds will be disbursed, our expectations are that local authorities can proceed to implement the CDF projects. As regards funds that will be sent in 2018 for 2017, the committees will have to sit and decide which projects to be implemented. When the funds for 2018 are sent, again, the committees will have to sit and decide which projects to implement and the implementation will go on in that order.

I thank you, Mr Speaker.

Dr Kambwili (Roan): Mr Speaker, an hon. Government Minister went to a constituency where a Constituency Development Fund (CDF) Project had stalled due to the non release of the CDF by the Government and said that the area hon. Member of Parliament had failed to implement the project. He later went back to launch the same project which he never initiated. Does the hon. Minister not think that that is an act of foolishness?

Hon. Opposition Members: Hear, hear!

Laughter

Mr Mwale: Mr Speaker, I do not think so.

I thank you, Sir.

CHIMTENDE AND MATUNGA PRIMARY SCHOOLS IN MKAIKA

197. Mr P. Phiri (Mkaika) asked the Minister of General Education:

when the second phase of upgrading Chimtende and Matunga primary schools in Mkaika Parliamentary Constituency would commence; and

what the time frame for the completion of the project was.

The Minister of General Education (Mr Mabumba): Mr Speaker, Chimtende and Matunga primary schools were among the twenty-two schools in the Eastern Province that were upgraded. To that effect, funds for Phase I of the upgrading programme were released by the Treasury and a 1×3 classroom block and staff house were constructed. Due to budgetary constraints, the ministry has not planned for Phase II of the upgrading programme. The focus is on completing all on-going projects before embarking on new ones.

Sir, the time frame for the completion of the projects will be known when the Government completes all the outstanding construction projects.

I thank you, Mr Speaker.

Mr P. Phiri: Mr Speaker, both schools are not connected to power. Does the second phase of the upgrading programme involve connecting them to power?

Mr Mabumba: Mr Speaker, I will be able to make the assessment on power connectivity when we begin Phase II of the project. That consideration is going to be given, especially that the schools are being upgraded into day secondary schools.

I thank you, Mr Speaker.

Mrs Fundanga (Chilubi): Mr Speaker, last time, we had requested the hon. Minister’s predecessor to come up with a list of schools to be upgraded and those to be refurbished. He had promised to bring that information to the House. Otherwise, this question will be raised over and over again. Is it possible for the hon. Minister to furnish us with information for each constituency?

Mr Speaker: Is the Hon. Minister able to provide that information?

Mr Mabumba: Mr Speaker, if my colleague looked at the 2018 Budget, which is an output- based budget, she would realise that the projects that the Ministry of General Education is going to implement are provided in the Budget. That is why we do not produce the infrastructure development plan for each year. Our colleagues have provided for that in the output-based Budget, including the budgets for the ministries of General Education, Higher Education and Community Development and Social Welfare. So, when the hon. Member looks at the budgets, she will see that all the schools that are being upgraded have been provided for.

I thank you, Sir.

LUANGWA DISTRICT HOSPITAL

198. Mr Miti (Feira) asked the Minister of Health:

when the Government would gazette Luangwa District Hospital; and

what had caused the delay in gazetting the hospital.

Mr Miti: Mr Speaker, as the Question has been overtaken by events, I would like to withdraw it by leave of the House.

Mr Speaker: Very well. The hon. Member says the Question has been overtaken by events. So, perhaps, the hon. Member should be given permission by the House to withdraw the question.

Question put and agreed to. Leave granted.

, by leave, accordingly withdrawn.

DELIMITATION EXERCISE IN MWINILUNGA PARLIAMENTARY CONSTITUENCY

199. Mr Samakayi (Mwinilunga) asked the Vice-President:

whether there were any plans to conduct a delimitation exercise in Mwinilunga Parliamentary Constituency; and

if so, when the plans would be implemented.

The Minister in the Office of the Vice-President (Ms Chalikosa): Mr Speaker, I wish to inform the House that the Electoral Commission of Zambia (ECZ) will only consider delimitating Mwinilunga Constituency if there are constitutional amendments to increase the number of constituencies.

Sir, as already stated in the response to part (a) of the Question, the delimitation exercise can only be conducted if there are constitutional amendments to increase the number of constituencies.

I thank you, Mr Speaker.

Mr Kambita: Mr Speaker, with twelve constituencies, the North-Western Province has the least number of constituencies in the country. Therefore, the delimitation exercise is quite crucial in the North-Western Province that has some of the largest constituencies in the country. Would Her Honour the Vice-President give us an indication of what she intends to do about the North-Western Province which has such big constituencies as Zambezi East, Chavuma, Mufumbwe, Kasempa. This issue has been debated on the Floor of this House for several years. So, we will not accept the lame excuse being given.

Laughter

Ms Chalikosa: Mr Speaker, the Electoral Commission of Zambia (ECZ) can only create new constituencies when there are constitutional amendments to increase the number of seats of elected Members in the National Assembly.

Mr Kampyongo: You are a Member of Parliament (MP). So, you should know.

Ms Chalikosa: Article 58(2) of the Constitution states:

“The number of constituencies shall be equal to the number of seats of elected Members in the National Assembly.”

I thank you, Sir.

Hon. Government Members: Hear, hear!

Mr Samakayi: Mr Speaker, is the hon. Minister in the Vice-President’s Office aware that in 2013, the Electoral Commission of Zambia (ECZ) recommended to the Government that Mwinilunga Constituency be divided into three constituencies. However, nothing has been done to date. Is she aware about this?

Ms Chalikosa: Like I said, Mr Speaker, it is all dependent upon amendments being made to the current Constitution.

I thank you, Mr Speaker.

Mr Speaker: Hon. Minister, the question is whether you are aware about the transmission of the recommendations to the Government. Are you aware about that fact?

Ms Chalikosa: Yes, Mr Speaker, we are aware.

I thank you, Sir.

SECONDARY SCHOOL IN CHIEF KUCHEKA’S CHIEFDOM IN ZAMBEZI WEST

200. Princess Kucheka (Zambezi West) asked the Minister of Housing and Infrastructure Development:

why the construction of a secondary school in Chief Kucheka’s Chiefdom in Zambezi West Parliamentary Constituency had stalled;

when the construction works would resume;

who the contractor for the project was;

what the total cost of the project was; and

what the time frame for the completion of the project was.

Mr Chitotela: Mr Speaker, the construction of Liyovu Boarding Secondary School in Chief Kucheka’s Chiefdom in Zambezi West Parliamentary Constituency stalled due to financial constraints. The progress of the project was also affected by seasonal flooding.

However, the construction works resumed in November, 2017.

The contractor for the project is Hua Jiang Investment Limited, and the total cost of the project is K48,709,354.05.

Sir, the time frame for the completion of the project is thirty-two months.

Mr Speaker, I thank you.

Mr Lufuma: Sorry, Mr Speaker, my follow-up question was on the Electoral Commission of Zambia.

Mr Speaker: Very well.

Princess Kucheka: Mr Speaker, I was in Kucheka Chiefdom last December and I found that the Chinese Contractor was having difficulty transporting materials to the site. Since there are no proper roads in Zambezi West, is it possible for the hon. Minister to consider constructing a road to the site? The reason the people of Zambezi West are lamenting is that they feel ...

Mr Speaker: What is your question?

Princess Kucheka: Could the hon. Minister consider asking the Chinese contractor to construct a road from the Boma to Chief Kucheka’s area so that he can transport the materials easily.

Mr Chitotela: Mr Speaker, I share the concern of the hon. Member of Parliament for Zambezi West. However, road construction is not part of the contract for the construction of the school. That will require us to go into a process of procuring a contractor to build the road.

As I earlier stated, seasonal flooding has been one of the contributing factors to the slow implementation of the project. We shall urge the contractor to speed up the works during the dry season.

I thank you, Mr Speaker.

Mr Jere (Livingstone): Mr Speaker, we have been told that the construction works have stalled. Before the works commenced or resumed, where there any variations made? Owing to the fact that prices of materials have skyrocketing, where there any variations made for us to ensure that the secondary school is completed on time?

Chitotela: Mr Speaker, no variations were made. The contract sum is still K48,708. So far, the contractor has been paid K4.8 million and the construction is at 25 per cent. The variations can only be carried out on request by the contractor. Thereafter, the consultant has to verify and approve them, but we have not received that information although the contractor is ready to complete the works within the contract value.

I thank you, Sir.

Mr Lufuma (Kabompo): Mr Speaker, this is a sad situation in the sense that the contract was awarded, yet there are no roads for the contractor to transport materials to the site. I wonder how the contractor will carry out his work. When signing the contract, did the ministry consider airlifting the materials to the location since there is no road transport?

Hon. UPND Members: Hear, hear!

Mr Chitotela: Mr Speaker, the process of floating tenders includes what is called site visit where contractors are invited to visit the sites so that they take the geographical position of the area into consideration as they submit their bids. So, for the contractor to have submitted a bid at such an amount, he must have taken that into consideration and was convinced that he could construct a school and deliver it to the Government within the contract amount. All that the Government can do for now is urge the contractor to speed up the implementation of the project. He visited the site, submitted the bill, as he was comfortable that he was going to execute the works.

Sir, constituencies like Lunga, Liuwa and Nalolo are difficult to reach. However, the Government cannot airlift the materials for the contractor to start constructing the district administration office in Lunga because the contractor has to bear the cost.

I thank you, Mr Speaker.

Princess Kucheka: Mr Speaker, the people of Zambezi West are anxious because they feel that it is like mufungufungu wakalalika kampoli nensala.

Hon. Government Members: Meaning!

Laughter

Mr Speaker: Of course, you have to translate that.

Princess Kucheka: Sir, there is a tree called mufungufungu. Then, kampoli is a small animal that approached the mufungufungu with big fruits but, when the wind came, it just swung the fruit sideways and it do not drop. In the meantime, kampoli was waiting for the fruit to drop. That is exactly what the people of Zambezi West have gone through, as they have been waiting for the Government …

Dr Kambwili interjected.

Princess Kucheka: Yes!

Laughter

Princess Kucheka: Mr Speaker, they have not received anything. That is why they think that they are like mufungufungu walalike kampoli nensala.

Hon. Opposition Members: Hear, hear!

Princess Kucheka: Mr Speaker, can the ministry assure the people of Zambezi West that the project is going to be completed within the stipulated time.

Hon. Opposition Members: Hear, hear!

Mr Speaker: Order!

The hon. Minister has just said that he is going to urge the contractor to expedite the contract.

______

BILLS

SECOND READINGS

THE PUBLIC FINANCE MANAGEMENT BILL, 2018

The Minister of Finance (Mrs Mwanakatwe): Mr Speaker, I beg to move that the Bill be now read a second time.

Sir, I wish to thank you for giving me the opportunity to share with the House the background to this Bill and its object.

Mr Speaker, in 2004, the Public Finance Act, 2004 was enacted. The Act also repealed the Finance (Control and Management) Act of 1969, most of whose sections were amended several times between 1969 and 2004. The Public Finance Act of 2004 was enacted in line with the 1969 Constitution of the Republic of Zambia. The Act was mainly an expansion of the Finance (Control and Management) Act of 1969. It provides for inter alia the establishment of the Office of the Secretary to the Treasury. It also establishes the Consolidated Fund.

Mr Speaker, this is the third time Zambia is enacting legislation in a quest to strengthen public financial management for the Republic. It is evident, therefore, that the Republic has for a long time been making strides in strengthening public financial management. This time around, The Government has been prompted to review and ultimately repeal the Public Finance Act of 2004 for the following compelling reasons:

Amendment of the Republican Constitution

Mr Speaker, the Constitution of Zambia Act No. 2 of 2016 that was assented to on 5^th January, 2016, has brought about a number of significant changes, many of which affect the public financial management framework of the Republic. For instance, there are issues introduced to deal with:

(a) the devolution of power;

(b) the strengthening of the Office of the Auditor-General;

(c) the changes in times of financial reporting; and

(d) the constitutionalisation of the offices of the Secretary to the Treasury, Permanent Secretaries and many others.

All these changes require adjustment in the Public Finance Act to bring them in line with the Republican Constitution.

Absence of a Part Dealing with Financial Misconduct in Existing Legislation

Mr Speaker, from the time the Public Finance Act of 2004 was enacted, this House and various stakeholders noticed the absence of clauses in the current legislation on the handling of cases relating to financial misconduct. Thus, recommendations were made to the Executive through the Public Accounts Committee (PAC) to include punitive measures aimed at strengthening accountability in the management of public resources in Zambia. In this regard, the Act that is being presented before the House today includes a part to deal with financial misconduct.

Absence of a Part or Dealing with Management of Public Assets and Stores

Sir, hon. Members of this House will agree with me that the last time regulation on the management of public assets and stores was legislated was in 1969. Therefore, the nation has been managing public assets and stores using outdated legislation.

Mr Speaker, I wish to mention that there is a positive correlation between effective management of public assets and stores, and sustainable economic development. In this regard, proper management of public assets and stores cannot be overemphasised.

Various Developments in Public Financial Management

Mr Speaker, we have also considered various developments in public financial management. Hon. Members of this House are aware that there are various developments and reforms in public financial management that have occurred over time. Among them are:

the implementation of the Integrated Financial Management Information System (IFMIS); and

the implementation of the Treasury Single Window Account (TSA).

Sir, all these developments should be incorporation into the Public Financial Management Framework in order to address queries and ambiguities in the current Act. Further, if information and communication technologies (ICTs) have to be fully utilised, there is a need for the Public Finance Management Bill to have features that recognise ICTs and their implications on the Public Financial Management Framework.

Sir, in line with the enactment of the new Bill, guidelines and other pieces of legislation will be reviewed to bring them in line with the provisions of the Bill.

Mr Speaker, I further wish to state that the Bill makes cross reference to the Planning and Budgeting Act as well as the Loans, Grants and Guarantees (Authorisation) Act which has not been enacted. Cross referencing them in this Bill may delay the enactment of the Public Finance Management Bill. As you aware, the Bill is trying to address issues raised in the various Auditor-General’s Reports on the management of public resources. Therefore, I will propose that they be removed from the Bill in order to expedite its enactment. Reference to the two Bills will be captured by the Public Finance Management Bill through other public finance laws. Once enacted, the law will automatically cross reference them. This action is meant to avoid delays in the enactment of the Public Finance Management Bill that is cardinal in addressing serious issues relating to the management of public funds as pointed out in the Auditor-General’s Report.

Mr Speaker, the Bill will provide for:

the establishment of an institutional and regulatory framework for the management of public funds;

the strengthening of accountability, oversight, management and control of public funds in the public financial management framework;

the creation of responsibilities and fiduciary duties of controlling officers and controlling bodies;

the enhancement of cash management systems to ensure efficient and effective utilisation of cash for the Government;

the creation of processes for the efficient production of the financial report for the Republic;

the management and control of public assets and stores;

the incorporation of clauses to deal with the use of Information Communication and Technology (ICT) in financial management systems;

the repeal of Act No. 15 of 2004; and

matters connected with, or incidental to, the foregoing.

Mr Speaker, I wish to urge all hon. Members of this august House to support the Public Finance Management Bill, 2017.

Mr Speaker, I thank you.

Mr Kunda (Muchinga): Mr Speaker, your Committee was tasked to scrutinise the Public Finance Management Bill, 2017. In carrying out its task, your Committee interacted with several stakeholders.

Mr Speaker, allow me now to share with the august House the findings of your Committee on the Bill. Your Committee is of the view that the Bill could not have come at a better time than now when the latest Report of the Auditor-General, like other reports, has highlighted irregularities regarding the utilisation of public resources while, in most cases, officers who are cited for such acts go unpunished. It is, therefore, envisaged that the enactment of this piece of legislation will not only improve public finance management, but also result in financial discipline and efficient use of public resources.

Mr Speaker, your Committee, therefore, supports the introduction of the Bill and wishes to make the following observations and recommendations. The main concern that has repeatedly been expressed by various witnesses during your Committee’s meetings is that the legal framework governing public finance management in Zambia is fragmented across different pieces of legislation. It is the view of your Committee that the proposed Bill has attempted to provide a solution to this concern by the inclusion of the supremacy clause.

Sir, your Committee observes, however, that there are certain clauses that have to be looked into before the Bill is enacted into law. Allow me to highlight some of them. Your Committee notes that the Secretary to the Treasury has been given extensive powers in the Bill. Regrettably, the security of tenure for the Office of Secretary to the Treasury is not guaranteed unlike other offices such as the Director of Public Prosecutions (DPP). Your Committee strongly recommends that the Bill provides for security of tenure for the Secretary to the Treasury so as to enable the holder of the office to discharge the mandate effectively and efficiently.

Your Committee further observes that the Bill has no provision for work experience among the prerequisites for one to hold the Office of Secretary to the Treasury. Your Committee is of the view that a lack of clearly defined professional experience for such an important office would pose a risk to public financial management.

Your Committee, therefore, strongly recommends that the minimum professional experience for the Secretary to the Treasury be provided for in the Bill.

Mr Speaker, your Committee notes that Clause 7(1)(k) of the Bill has granted the overall responsibility of opening, maintaining and closing accounting units in ministries, departments, government agencies, local authorities, provinces, districts and projects to the Secretary to the Treasury. Your Committee is concerned that this provision is not in line with the spirit of decentralisation which requires such functions to be devolved to local authorities. In this regard, your Committee recommends that Clause 7(1)(k) of the Bill be amended as follows:

“(k) be responsible of opening, maintaining and closing accounting units in ministries, departments, government agencies and projects”; and

“(l) be responsible for superintending over and supporting the opening, maintaining and closing of accounting units in local authorities, provinces and districts.”

Mr Speaker, your Committee observes that Clause 12(3) of the Bill, which provides for the declaration of interest by a controlling officer or a member of a controlling body, has been extended to include members of the broader extended family. Your Committee is of the view that enacting the clause in the manner it has been drafted may implicate innocent controlling officers. In light of this, your Committee recommends that the clause be amended to draw a distinction between the interests of immediate family members and distant relations.

Mr Speaker, your Committee observes that while the Bill provides for the Controller of Internal Audit, it does not stipulate the required qualifications and work experience for one to hold such an office. In this regard, your Committee recommends that the Bill be amended to provide for appropriate qualifications and minimum work experience of ten years for the position of Controller of Internal Audit, as is the case with the Accountant-General under Clause 9 of the Bill.

Sir, your Committee observes that Clause 22(4) provides for a seven-day period in which the Secretary to the Treasury should authorise a disbursement from the Consolidated Fund before the end of the financial year. Your Committee contends that the period is too short, especially in the event of an emergency. It, therefore, recommends that a more reasonable period be prescribed.

Mr Speaker, your Committee is concerned about the apparently unfettered authority given to the hon. Minister in Clause 24 of the Bill to withdraw monies from the Consolidated Fund without the involvement of the National Assembly. Your Committee strongly recommends that the clause be amended to provide for the hon. Minister to seek authority from the National Assembly before such withdrawal.

Mr Speaker: Order!

Business was suspended from 1640 hours until 1700 hours.

[MADAM DEPUTY SPEAKER in the Chair]

Mr Kunda: Madam Speaker, before business was suspended, I was about to say that your Committee observed that Clause 28 provides for Government revenues collected by appointed agents on behalf of the Government to be transmitted to the Consolidated Fund. Your Committee is concerned about this provision because it does not recognise the role of local authorities in so far as the collection of general revenue is concerned. In light of the above, your Committee strongly recommends that Clause 28 be amended to provide for the requirement that the hon. Minister shall, by Statutory Instrument (SI), prescribe the proportion of general revenue in the Consolidated Fund that shall be strictly ring-fenced for the sub-national government.

Madam Speaker, your Committee has observed, with dismay, that the Bill does not provide for sanctions regarding financial misconduct by the Secretary to the Treasury. In this regard, your Committee recommends that sanctions be prescribed for acts of misconduct by the Secretary to the Treasury, such as failure to take action against any erring controlling officer.

Madam Speaker, your Committee observes that Clause 72, which provides for reporting requirements for statutory corporations or state-owned enterprises, excludes a controlling body of a local authority. Your Committee recommends that Clause 72 be amended to include reporting requirements of a controlling body or local authority in order to promote fiscal decentralisation and local level financial discipline.

Madam Speaker, in conclusion, I wish to express your Committee’s gratitude to you for the opportunity given to it to scrutinise the Bill. Gratitude is also extended to the stakeholders who gave both written and oral submissions which greatly assisted your Committee in its work.

Last, but not the least, I wish to thank the Clerk of the National Assembly and her staff for the service rendered to your Committee throughout its deliberations.

I thank you, Madam.

Dr Musokotwane (Liuwa): Madam Speaker, I thank you for giving me the opportunity to make some remarks on the Bill that has just been presented.

Madam Speaker, from the outset, let me state that I support the Bill. It is a good move, and the timing is good, especially that many issues of financial mismanagement have been raised by the Auditor-General’s Report in Zambia. Despite the heavy investments that have been made in financial management systems, these issues still appear in the report every year. Millions of United States (US) Dollars have been spent to automate the accounting functions in the Government, but cases of financial mismanagement are still prevalent.

Madam Speaker, I agree with most of the recommendations of your Committee. I just want to make one additional suggestion. I think the rising practice world over is that when a particular administration is about to leave office at the end of its term, it is compelled to produce a financial statement outlining the financial position of the country. This is done to ensure that there is no doubt left about the condition of the finances of the country and to keep the incoming administration up to speed regarding the finances. There is also a penalty that is applied if the country is mislead about this. If the financial position of the country is contrary to the report of the outgoing administration, that would become an issue and the people involved can be disciplined for that. I recommend that we adopt this as a country.

Madam Speaker, let me talk about one or two specific issues about this Bill. I like the fact that one of the issues raised in the report of your Committee is why, in spite of the laws that exist, action is often not taken against erring officers. I think we have seen this over and over again. The volume of the Auditor-General’s Report has been growing over the last few years. Are we seeing any tangible action being taken against the erring officers? In particular, I want to ask whether we are absolutely sure that the problem here lies in the inadequacies of the law. Is that really where the problem is or does it lie in something else? This is why I commend the Committee for pointing out that controlling officers are Permanent Secretaries (PSs) who, in most cases, are appointed by the President. The Secretary to the Treasury is also appointed by the President. So, the question is: Can the Secretary to the Treasury, especially in the light of what was indicated as regards the lack of security of tenure, unilaterally take action against a controlling officer who is a PS? Will the/she feel safe? From what we have seen so far, this is clearly one of the outstanding issues. In that respect, therefore, I like the recommendation that if the Secretary to the Treasury does not take action against an erring officer, that failure goes towards his/her evaluation. That way, people will take the Secretary to the Treasury to task for not taking action despite being aware of a transgression and that can be used against him/ her.

Madam Speaker, I would like to add that this should not end with the Secretary to the Treasury, but the controlling officers. This is because many times, controlling officers are aware of the wrong doings, but do not do anything about them. For instance, somebody may misappropriate public funds, but the controlling officer simply says that money is going to be recovered when, in actual fact, that is theft. I wish to extend by saying that a controlling officer who fails to take action on an erring officer should be charged with an offence.

Madam Chairperson, finally, in supporting this Bill, I personally do not believe that the problem here is the absence of the law, as it lies somewhere else. For instance, a few years ago, during the tenure of the late President Mwanawasa, SC., action was taken against a number of transgressors using a law which was much weaker compared to the one we are repealing at the moment. People were arrested and jailed. That was because of the commitment that was shown from the top by sending a strong message that financial transgression would not be tolerated. Therefore, the question I ask is: If action was taken against wrongdoers when the law was weaker, why is it that today, with a stronger law in place, which we are repealing today, wrongdoers are going scot-free, as action is not taken against them? I feel strongly that we should not hide in the claims that we are failing to take action because the law is weak. Even the current law is fairly strong. If there was commitment to using the existing law to punish offenders, we would have made progress. However, this is what is missing.

Madam Speaker, I would like to urge the Government to show commitment in dealing with wrongdoers. In fact, I think that the weaknesses that we see in implementing the law are not just restricted to the financial sector, but also other sectors across the country. We have seen cases where senior officers make transgressions such as assaulting somebody, cock a firearm in the wrong place, issue inflammatory statements, but the police will keep saying we are still investigating. While all this is happening, the controlling officers are watching. In the end, they say to themselves, if that powerful man could commit a crime and nothing happened to him, why should I stick out my neck to punish an officer who has committed a financial crime? So, they sit back.

Madam Speaker, as I conclude, I wish to welcome this Bill. However, I do not believe that we are failing to take action against erring officers because of the inadequacies in the law. The real reason is that as a nation, we have become amenable to looking the other way when a crime is committed. That is where the challenge lies in terms of enforcing financial discipline in the country.

Madam Speaker, I said I was going to be brief. So, with those remarks, I thank you.

Hon. Opposition Members: Hear, hear!

Dr Kambwili (Roan): Madam Speaker, I thank you for according me the opportunity to debate the Public Finance Management Bill, 2017.

Madam Speaker, from the time I came to this House in 2006, I have seen the growth in volume of the Auditor-General’s Report, year in and year out. However, there is very little action being taken against erring officers. I hope that the coming of this Bill will sort out this problem that has been with us for a long time now. It is only in this country where we see people living well beyond their means and we turn a blind eye to that. We live with the people who pilfer from the Government coffers. They are our friends and neighbours. So, we know how much their salaries are. We know the kind of life they live. What is more disturbing is that when you report to the Anti-Corruption Commission (ACC), nothing is done about it. As was the case during Dr Kaunda’s era where we had a Leadership Code, when we see someone living above their means, the ACC should quickly move in and find out where he/she is getting the money from. Today, when we see the kind of vehicles some civil servants drive or se them take their families for holidays three or four times a year, we just turn a blind eye to all that. For instance, when one is appointed Permanent Secretary (PS), his/her lifestyle changes within six months. When that happens, all that we do is watch even when we knew that person’s lifestyle before his/her appointment as PS. We are ‘crying’ about the lack of classrooms and schools, yet we watch people plunder our national resources and do not take action against them.

Madam Speaker, we are being unfair to ourselves and the country by defending those who are corrupt and are pilfering public resources. We should not just sit back and watch people’s lifestyles change and do nothing about it. It is high time we called a spade a spade, and not a pick just for the sake of protecting those in the wrong because we know them. My appeal to the Secretary to the Treasury, who has been given more powers under this Act, is that he should pull up his socks and save the resources of this country. It cannot be business as usual while we lose money year in and year out that is supposed to go towards the implementation of social programmes. This Bill is long overdue, and I hope and trust that this is not going to be one of those Bills that are left to gather dust in our offices.

Madam Speaker, we are good at making laws in the country, yet some of the laws we have made are just gathering dust. I am worried about implementation and wonder whether we are serious about this Bill. If we are serious, we will see a reduction in the pilferage and misuse of public resources in the next two years. However, the problem that we have is that we do not want to implement laws that we know will affect us or our friends.

Madam Speaker, for instance, the Markets and Bus Stations Act is very clear that revenues from markets and bus stops should only be collected by the local authority. However, there are cadres at markets and bus stations whom we use to perform acts of violence against innocent people. The cadres levy bus operators and traders, yet the law is very clear on who should collect levies. That is daylight theft, but no one has taken action against the cadres.

Madam Speaker, another law was passed in regard to the proceeds from the mining companies. According to that law, the proceeds should be shared among the communities and chiefs of the areas in which the mines operate. What has happened to that law? I have never heard of any chief or community that has benefitted from the proceeds from mining companies.

Madam Speaker, I hope the hon. Minister of Finance will ensure that this law is applied to the letter so that the ills of pilferage, corruption and misuse of public funds, which are supposed to go towards the development of this country, can come to an end.

With these few remarks, I support the Bill.

I thank you, Madam Speaker.

Mr Mukosa (Chinsali): Madam Speaker, thank you for giving me the opportunity to comment on the Public Finance Management Bill, 2017.

Madam Speaker, from the outset, I would like to state that I support the Bill on the basis that it is going to provide for an institutional and regulatory framework that will help us enhance and strengthen accountability and transparency in the management of public funds.

Madam Speaker, this Bill is going to enhance internal controls in the management of public finances. One of the reasons I support this Bill is ...

Madam First Deputy Speaker: Order

Hon. Member, are you a member of the Public Accounts Committee?

Mr Mukosa: Yes, but I was not a member at the time it was being considered.

Madam First Deputy Speaker: Alright, you may continue.

Mr Mukosa: Thank you, Madam Speaker.

Madam Speaker, as I was saying, I support this Bill because it talks about risk management, which has featured prominently in the Bill. The Bill has given the responsibility to the Secretary to the Treasury to design and implement a risk management framework that is effective and see to it that it is properly implemented. Controlling officers have also been given the responsibility to ensure that risk management practices are implemented in the public institutions that they manage. Additionally, Bill is requesting internal auditors to ensure that risk management practices and systems of internal control exist in public institutions, whether it is the Ministry of Agriculture or a local authority. This will help us curb abuse of financial resources.

Madam Speaker, the hon. Member of Parliament for Roan talked about the revelations in the Auditor General’s Reports. He said that many people have been exposed by the reports, but have not been punished. This Bill provides a cure to that complaint by most. The Bill suggests that those who are found liable, depending on the decision of the courts of law, may face a jail term of four to five years.

Madam Speaker, the Seventh National Development Plan is from 2016 to 2021. In terms of developmental outcomes, it talks about investing in transport infrastructure such as roads, airports and airstrips in the aviation industry. It also talks about investing in water and sanitation. These are huge capital investments. We need to seal the leakages in the administration of finances in order to achieve our objectives of investing in huge projects. When we seal the leakages, we shall have enough money to reduce poverty and take development to both the rural and urban areas.

Madam Speaker, the hon. Minister of Infrastructure and Housing talked about the construction of feeder roads in provinces, some of which will be financed by the Government. So, we need to seal the leakages so as to stop civil servants from stealing ...

Madam First Deputy Speaker: The term “stealing” is unparliamentary. Withdraw it.

Mr Mukosa: I withdraw the word and replace it with “people getting what is not theirs or misusing Government resources”.

Madam Speaker, this Bill also strengthens internal controls. For instance, it has introduced the position of Stock Verifier. Before officers from the Office of the Auditor-General go to a local authority or public institution to conduct an audit, the Stock Verifier will ensure that stocks are as reported by the stores controller. The stock verifier will work under the Controller of Internal Audit.

Madam Speaker, this Bill also clears the ambiguities in who will be a controlling officer. For instance, some ministries have two Permanent Secretaries (PSs). This Bill, however, clearly states that the Secretary to the Treasury will only designate one as a controlling officer. For instance, the Ministries of Health, General Education and National Development and Planning have more than one PS. In the past, it was not clear who was the controlling officer between the two PSs, but this Bill now stipulates that only one will be designated controlling officer by the Secretary to the Treasury.

Madam Speaker, apart from that, where the Secretary to the Treasury sees a controlling officer perform bellow a par, the Bill given him the authority to write an instruction to withdraw the designation as controlling officer and give a copy to the Office of the Auditor-General.

Madam Speaker, what used to happen when the Public Finance Act of 2004 was still in force was that when officers from the Auditor-General’s Office went to a local authority or public institution to collect some documents for auditing and the controlling officer or custodian of the documents did not comply with that requirement, the Auditor-General’s Office would report to the Secretary to the Treasury who, in turn, reported to the hon. Minister who had to rule on whether or not the documents should be given. However, the current Bill states that, “If the person refuses to give documents to an agent who has been sent by the Secretary to the Treasury, then, the Secretary to the Treasury will immediately provide a solution or make judgment on what should be done by either giving the documents or not. ” What used to happen was that if the hon. Minister is not around and people are conducting an audit, then, they will have to wait for the hon. Minister to return, from Brazil, for instance, to make a decision on the matter. However, the Bill has shortened the process. The Secretary to the Treasury will actually make a decision and progress will be made.

Madam Speaker, the Chairperson of the Public Accounts Committee talked about Clauses 70 to 72 of the Bill that provide for the timeline within which financial reports should be submitted to the Secretary to the Treasury. This is very important in that we know that every financial year runs from January to December. So, the following year, that is, within a period of one month, financial statements should be ready. If not, we are guided that the people who contravene the provisions of this Bill will be liable to punishment.

Madam Speaker, the Bill has also given responsibility to the Secretary to the Treasury to ensure that he/she submits internal audit reports on the performance of public institutions relating to internal controls, risk management and governance matters to the hon. Minister of Finance on a quarterly basis. The hon. Minister may submit the quarterly reports to the Cabinet for it to act on. This means that when there are problems in any public institutions, they will be identified, at least, every three months. In an event that a person has been ‘stealing’ – Sorry, I withdraw the word “stealing’, and replace it with abusing resources or public funds – the Secretary to the Treasury or Government officers will quickly identify the problem within three months and will put measures in place to control the abuse.

Madam Speaker, this Bill has also requested that a report on risk management and any other issue related to corporate governance be attached to every financial report. This is also progressive and I support it.

Madam Speaker, I wish to agree with the recommendation by the hon. Member for Muchinga, who is also the Chairperson of the Public Accounts Committee (PAC), that the qualifications for the Secretary to the Treasury be stated in the Bill. This is because the Bill has stated that Accountant-General should meet the minimum qualification of an accountant and be a registered member of the Zambia Institute of Chartered Accountants (ZICA). How will the Secretary to the Treasury supervise the Accountant-General and the Controller of Internal Audit who have high qualifications and a lot of experience if he does not meet the minimum qualifications of ZICA, Chartered Institute of Management Accountants (CIMA) or Association of Chartered Certified Accountants (ACCA) or something of that nature? It is going to be very difficult for him to supervise them. The hon. Minister of Finance should consider setting some minimum qualifications as a pre-requisite for one to hold the Office of Secretary to the Treasury.

Madam Speaker, I also think the hon. Minister of Finance should do something about the security of tenure for the Secretary to the Treasury.

Madam Speaker, with these few remarks, I would like to support the Bill.

I thank you, Madam.

Hon. PF Members: Hear, hear!

Mr Kafwaya (Lunte): Madam Speaker, I would like to thank you for the opportunity to support the Bill on the Floor of the House. Like the hon. Member for Liuwa Constituency, I will be very brief in my submission because my support for this Bill is based on a one-line statement which is the importance of funds or money or cash.

Madam Speaker, as I talk about the importance of cash, I have in mind all the economic activities that have to be undertaken in our Republic. Social and cultural activities include all the value activities to be undertaken by the Government in order to improve the lives of the Zambians. The importance has been underscored, especially in this era of productive capacity expansion by the ambitious programmes that have been undertaken by the Government. These are infrastructure development and economic diversification. For these activities to be carried out, we need the application of funds. We know that funds are a resource that is scarce. So, we should have a system in place that is able to secure the generation, collection, application and accounting of funds and reporting how the funds have gone through all these processes.

So, Madam Speaker, for this country to sustainably generate funds, all the Zambian people should promote activities that will create an attractive environment for this.

Madam Speaker, that is why I have issues with citizens of this country who fail to promote the country. By failing to promote this country, what one is effectively doing is making it uncompetitive so that it fails to create funds. So, I wish to call upon all the people with a platform to speak, to speak good of this country. All the people should promote this country so that it is able to generate funds before we can talk about the collection, application and accountability of the funds. The business and political environment should be conducive too. So, it is my call on fellow Zambians to ensure that our political, social and economic environment is enhanced by the views that we promote.

Madam Speaker, this Bill is mostly talking about the safeguarding of this asset and its application, accounting and reporting. In the application, clear guidelines of how to safeguard this have been promoted in this Bill. Therefore, it is important to see progressiveness in the Government which has decided, after so many years, to bring a Bill such as this one on the Floor of the House. Like the hon. Member for Liuwa stated, this Bill is timely. I agree with him 100 per cent. I, therefore, wish to thank the Government for bringing the Bill to the House.

Madam Speaker, let me also talk about reporting because most of the things that have been talked about here hinge on the availability of information. The Auditor-General brings information to the House and other stakeholders, including His Excellency the President. We draw from that report. So, this Bill is to ensure that reporting on financial application is enhanced. In view of this, I wish to unequivocally support the Bill.

I thank you, Madam Speaker.

Mr Kambita (Zambezi East): Madam Speaker, I do not intend to say much on this Bill. I am cognisant of the fact that some of the things I would have talked about have already been mentioned by other speakers.

Madam Speaker, I would like to tell the hon. Members of Parliament that the Government raises its finances through taxes, fees and borrowing. If the Government raises its funds through those means, the monies that we talk about here are public funds. We should first of all appreciate the fact that we are talking about public funds.

Madam First Deputy Speaker: Order!

Hon. Member, I have a problem with your statement that you want to tell this House so that the members know how the Government raises its funds. My fear is that the citizenry will believe that the hon. Members of Parliament do not know, yet we know that they know. You will withdraw that statement and give a better pre-amble to your debate.

Hon. Government Members: Hear, hear!

Mr Kambita: Madam Speaker, I was simply saying that the Government raises funds through taxation, fees and borrowing. In essence, these are public funds and, therefore, need to be managed well.

Madam, I would like to support the Public Finance Management Bill, 2017. I wish to state that financial management involves the raising of finances. I mentioned a few areas in which the Government raises finances. It also involves the utilisation of the funds that have been raised. So, prudent utilisation of the funds is very important in order for us to achieve our objectives.

Madam Speaker, we sometimes struggle to achieve our objectives because we have managed our finances poorly and not because we do not have adequate resources. I hear most Cabinet Ministers lament the lack of finances here. When you look at the bigger picture, you will find that the reason the reason we seem to be having inadequate finances is that we have not prudently managed our finances.

Madam Speaker, financial management starts with good planning. We sit in this House from around October to December, appropriating the finances which the Government raises. That is good planning. However, we should not look at how the implementation is done at a distance. The Constituency Development Fund (CDF), which we failed to receive last year in full, is an example of poor financial management. The way we implement things differs from the way we plan for them. Good planning is a very important ingredient to sound financial management.

Madam Speaker, the other aspect of good financial management is a good regulatory framework. I am glad that this Bill is coming at this time because this will act as a regulatory framework which the Secretary to the Treasury would use to manage controlling officers who manage the finances. Therefore, I commend the Government for bringing this Bill. It could not have been brought at a better time than this when we have so many complaints relating to utilisation of finances in the Government. However, even when the Government has sound plans on the utilisation of finances and a good regulatory framework on the implementation controls which are put in place, diligent implementation of what has been planned is cardinal. We have seen situations where controlling officers have gone on rampage to do whatever they want because they pay allegiance to the appointing authorities. In any case, sometimes, the Secretary to the Treasury does not have power to discipline the controlling officers. Year in and year out, issues have been raised in the Auditor-General’s Report, yet nothing has been done about erring controlling officers. In the Government set up, the Secretary to the Treasury is mandated to oversee a sound financial management system. This Bill will enhance the role that the Secretary to the Treasury is given.

Madam Speaker, in most cases, we have observed that focus has been on controlling officers in line ministries, ignoring the bigger chunk of the public finances that goes to public institutions that are not under line ministries. We have big sums of money that go to universities, parastatal companies and various public institutions, yet we have a situation where some of the institutions have never prepared financial statements before. Examples abound and I would not want to catalogue them before the House. It is a well-known fact that some public institutions have failed to produce financial statements. Others would have produced financial statements, but have never been audited. That gives birth to what I want to talk about now.

Madam Speaker, if there is no capacity to implement internal controls, there is no way we are going to implement a sound financial management system. Often times, we have had situations where institutions have not been audited and have gone scot-free. There are institutions that have not been audited since 2013. Financial statements from as far back as 2014 are being audited now when probably the erring officers or people who could have been involved in the mismanagement could have left the institutions or even died. What would we be solving by auditing such institutions now?

Madam Speaker, if the Government cares to know, it should check how much has been allocated towards the operations of the Auditor-General’s Office this year, yet it is expected to audit Government institutions, including line ministries and public institutions because public finances are used by the institutions, either in the form of grants, the Local Government Equalisation Fund or whatever they have been financed for. That is the reason we have problems. We have looked at the objectives without looking at the capacity to achieve them.

Madam Speaker, we have glaring audit queries in the Auditor-General’s Report not because he was harsh on the public institutions or we do not know what is going on in the institutions, but because we do not have a strong regulatory framework and a system of internal controls to arrest the atrocities.

Mr Ngulube: Ema few words, aya!

Mr Kambita: Madam Speaker, concerning indicators of weak internal controls, where there is no segregation of duties, just know that the internal controls are very weak. In some institutions, we have had situations where a big procurement is made based on one man’s decision. Yes, I am aware that there are policies and procedures that exist on paper. However, they are not bold enough to arrest the atrocities that we are seeing in the utilisation of public finances.

Madam Speaker, as regards the organisation and structure, if a controlling officer, who is a Permanent Secretary, is appointed by the President and is found wanting, it is very difficult for the Secretary to the Treasury to discipline such an officer. It also depends on the kind of relationship the controlling officer has with the President. These are the issues we must be addressing and which such documents should address. That way, we will achieve something from this Bill.

Madam Speaker, with regard to authorisation of expenditure, we, on your left hand side, have observed that in the Patriotic Front (PF) Government, expenditures can be authorised anyhow, depending on how much influence or how connected one is to the ‘big house’. If authorisation was well documented and punishment was meted out on people who give authorisation without documentation or that is not in line with the law, that would help us. I am glad this Bill has been brought to the House and we will be passing a law which will help us achieve that.

Madam Speaker, let me talk about the presentation of financial information. Some accounts produced by public institutions make sad reading. We need to have standards, and I am glad that that will be addressed in this Bill. We need to have a minimum standard of financial information required in order for auditors to understand what has happened in a particular financial period.

Madam Speaker, as regards supervision, some institutions are almost forgotten about. An institution can receive public funds, but nobody is in charge of supervising it. An institution can go for years without producing financial statements, yet on paper it would be stated that it falls under the Ministry of Transport and Communication or any other ministry, for instance. So, when such institutions are not supervised, definitely, you expect to see some irregularities.

Madam Speaker, institutions need to reproduce macro plans that feed into the main plan, namely the Budget. Alas, we have a situation where a chunk of money is allocated to an institution without a plan in place. For instance, a certain institution received a Eurobond without presenting a plan. Since there was no plan, the employees came up with a myriad of board meetings on which they spent the money. So, we cannot blame them. We need to have standards to help us manage our resources.

Madam Speaker, with regard to accuracy in reporting, of course, the only way we can estimate accuracy in finances is when we engage the Auditor-General’s Office. The Auditor-General needs to visit public institutions on a regular basis and there have to be proper internal control systems in place for internal auditors. That way, we will have reasonable assurance to rely on the figures that come from public institutions.

Madam Speaker, how are public institutions managed? Many are the times we have people appointed to boards on the basis of how well they have presented himself in the political arena without proper knowledge of the management of the operations of the institution.

Mr Bwalya: On a point of order, Sir.

Madam First Deputy Speaker: Please, take your seat. Allow him to debate. He still has five minutes.

Please, continue hon. Member.

Mr Kambita: Thank you, Madam Speaker for that protection. We need to have institutions that are well managed. We seem to suffer from a lack of this.

Madam Speaker, my debate is non-controversial. I am only helping us find a solution. Like I said from the outset, I support this Bill because it will help us achieve our objectives. Unless control measures and regulatory benchmarks are put in place, we will be shooting in the air. We can have a very good document, but we will not achieve anything.

Madam Speaker, in conclusion, I support the Bill, subject to the suggestions that I have made.

I thank you, Madam Speaker.

Dr Imakando (Mongu Central): Madam Speaker, thank you for the opportunity to debate this Bill that will pave way for an institutional and regulatory framework for the management of public funds.

Madam Speaker, just as the hon. Member of Parliament for Liuwa has said, we are not short of good rules and regulations. What this country is short of are ways of managing, recruiting, motivating and disciplining its human resource. I am referring to the issue of politicising the Civil Service. When politics begin to interfere with the operations of the Civil Service, very little progress would be made. Therefore, this country should allow civil servants to work without political interference. Those holding high political offices should stop interfering with the operations of the Civil Service. For as long as there is political interference, this Bill will not go a long way. Hence, the urgent need to de-politicise the Civil Service.

Madam Speaker, allow me to talk about politically-motivated appointments which will take us nowhere. I am saying so because in the last few months, we have seen many people being retired in public or national interest. When one investigates to find out the reason they have been retired, one comes up with stories that there was a political hand in their retirements. As a result, we have lost many good professionals. When we lose such professionals, we award jobs to the unqualified. The unqualified are appointed to positions they cannot manage. As a result, even where we have good rules and regulations, we miss the bolt.

Madam Speaker, human resource is important. Therefore, we need to motivate the people by ensuring that they have good conditions of service and good regulations. Otherwise, without a motivated human resource, we will not achieve the desired results.

Madam Speaker, let me now talk about the issue of not punishing wrongdoers. We send a wrong message by not punishing wrongdoers in this country. From nowhere, they are seen to thrive and own properties they cannot account for. The same wrongdoers seem to exercise influence in the corridors of power. As a result, the message that we send is that it is alright to do wrong things, yet hard workers and faithful ones are ignored and sometimes even punished, especially if they guide some of our colleagues in ministerial positions. They are threatened, transferred or fired.

Unless we have a good Civil Service that takes care of public assets, this country will not develop at the desired pace. So, in supporting this Bill, Madam Speaker, I wish to say that those who are charged with the responsibility of employing people who will take care of our public funds must pay attention to qualifications, experience and should motivate the people. I say so because a very good car is just about as good as its driver.

Madam Speaker, a wonderful Mercedes Benz like the one Her Honour the Vice-President uses will only last if the driver takes good care of it.

Madam Speaker, I thank you.

Hon. Opposition Members: Hear, hear!

Mr Kabanda (Serenje): Thank you very much, Madam Speaker, for according me the opportunity to debate on the introduction of the Public Finance Management Bill which is before the House.

Madam Speaker, introducing legislation and implementing it are two different things. I say so because it is often said that familiarity breeds contempt. Why do I say so? If the controlling officers who are responsible for ensuring that public resources are protected do not bring these issues to the attention of the people that are supposed to look after public resources, then, we will have lost it. Often times, senior public officers work in collusion with junior officers.

Mr Mutelo: Hear, hear!

Mr Kabanda: So, if this Bill is enacted, and if those that are meant to implement its contents do not do so, then, we shall be shooting in the dark.

Madam Speaker, according to page 25 of your Committee’s Report, the functions of an internal auditor are to:

“(a) ascertain the risk management and internal control systems;

(b) ensure that internal systems are in place and continually being improved; and

optimising response to an ever changing environment.

These are basic requirements that every internal auditor should know. An internal auditor should know where the risk is.

Today, Madam Speaker, you will notice that public vehicles are not taken care of. An officer could be involved in an accident and a public vehicle is damaged, but nothing is done about it. An officer willfully damages public property and is not made to account for that property. Therefore, if there is no proper implementation of the Public Finance Management Act, I do not think we shall achieve anything.

Madam, from 1964 to 1991, this Bill was not there, yet pilferage of public resources was at its minimal.

Hon. Opposition Members: Yes!

Ms Tambatamba: Hanjika!

Mr Kabanda: However, today, there is financial hemorrhage at its highest level.

Hon. Opposition Members: Hear, hear!

Ms Tambatamba: Serenje!

Mr Kabanda: Is this Bill going to bring any sanity in the management of finances in public institutions, Madam Speaker? I doubt it. We need strong men and women to manage these institutions and ensure that this law is implemented to the letter.

People are stealing money with impunity. People are pilfering money with impunity.

Madam First Deputy Speaker: Withdraw the word “stealing”.

Laughter

Mr Kabanda: I withdraw the word “stealing” and substitute it with “misapplying”, Madam Speaker.

Mr Mutelo: Hear, hear!

Mr Kabanda: People are misapplying public funds with impunity.

In the olden days, we had stern regulations. Today, even institutions that are supposed to monitor public servants and their lifestyles are no longer in existence. That is the reason the level at which public funds are being pilfered is very high. For this reason, we need men and women who can implement this law to avoid further public financial mismanagement.

In support of this law, Madam Speaker, I want to say that we should have men and women who are fearless enough to bring the culprits to book.

I thank you, Madam.

Hon. Opposition Members: Hear, hear!

The Minister of Works and Supply (Mr Mutati): Madam Speaker, firstly, I wish to thank the Chairperson of the Public Accounts Committee for the comprehensive report and the substantive recommendations that he has rendered for this Bill. I think his recommendation will go a long way in addressing the mischief, particularly of the Public Finance Management Act of 2004.

Madam Speaker, …

Madam First Deputy Speaker: Order!

Business was suspended from 1810 hours until 1830 hours.

[MADAM FIRST DEPUTY SPEAKER in the Chair]

Mr Mutati: Madam Speaker, before business was suspended, I was saying that the Bill that we are debating today is not only timely, but also a landmark and people’s Bill.

Madam, one of the primary objectives that were illustrated by the hon. Minister and the Chairperson of the Public Accounts Committee was that it aims to elevate the levels of accountability and public resources management, and putting fiscal discipline at the centre. Equally, what is also important in the Bill is to cure the mischief of the Public Finance Act of 2004. The Public Finance Act of 2004 was a good law, but it was not an effective law. The Act provided space for those whose core competence and enterprise was to misappropriate public resources.

Madam Speaker, what we are trying to address in this Bill is the worrying trend that has been reported on a yearly basis by the Auditor-General’ Office regarding the misappropriation of public resources, financial irregularities and misuse of financial resources. Matters and the trends, which have been lamented and spoken about by the Public Accounts Committee, need to be arrested, hence the basis for bringing the Bill to the House.

Madam, this Bill goes further to ensure the strengthening of the institutional and regulatory framework for the prudent management of public resources on the basis that the resources are limited and competing needs are numerous. Unless we can save the resources, we will not be able to meet our developmental agenda.

Madam Speaker, in addressing the mischief of the Public Finance Act of 2004, the Bill introduces punitive measures to be taken against those found wanting and has clearly defined the offence and penalties that are associated with a controlling officer who may commit a financial mischief. The other issue, which has been introduced in the Bill, is the recognition of electronic platforms. One of the limitations, which have been appearing in the Auditor-General’s Report, is that, this far, electronic evidence was not recognised by the Auditor-General’s Office. Consequently, most of the irregularities in the Auditor-General’s Report emanated from the fact that when transfers were made by the Ministry of Finance, the auditors demanded physical paper evidence, which was non-existence and, therefore, they were reported as unvouched payments, yet the payments were actually made. Therefore, the introduction of the electronic platform, which is recognised in the Bill, will minimise what were referred to as unvouched payments or unretired imprest. I believe it is significantly important that this is being introduced in this Bill.

Madam, other issues of concern were raised regarding the requirement of the hon. Minister of Finance to come back to Parliament whenever she wants to withdraw from the Consolidated Accounts. The section, which was referred to by the Chairperson of the Public Accounts Committee relates to grants and donations.

Madam Speaker, hon. Members of Parliament will recall that when we are approving the Budget, some components of the Budget are grants and donations. So, when the Budget is approved, we also approve the Appropriation Account. Therefore, to require the hon. Minister of Finance to come to the House, again, to seek approval for that which was already approved by Parliament is double approval. So, this is comfortably dealt with in the Public Finance Act.

Madam Speaker, an issue was raised regarding the tenure of the Secretary to the Treasury and that we needed to provide security around the tenure. The rationale was that unless he is secure, he will not dispatch his duties and responsibilities effectively. Therefore, what is important is to recognise that the Secretary to the Treasury operates under delegated authority of the hon. Minister of Finance and His Excellency the President. Therefore, his operations and vision that he must carry should be the vision of those who are delegating that authority. If we gave him security of tenure, we were going to introduce inconsistency and rigidity because whose vision was he going to advance? This is the reason the Bill before us has not put in place the issue of security of tenure because the Secretary to the Treasury is not like the Auditor-General or a Judge because he operates under delegated authority.

Madam, another issue which was raised, was that at the end of the five years, there must be an end of term statement defining and accounting for all the assets, liabilities and issues around the Government. I believe it makes sense and it is a sensible requirement. Therefore, this particular obligation requires that it be enshrined in the Public Finance Act, yet it is a matter of the Constitution. Therefore, that requirement must find its presence in the Constitution. Accordingly, there must be a submission on the work being done on the Constitution which can be debated and dealt with within that framework.

Madam Speaker, what we need to do beyond the Public Finance Act is to bring to the House other relevant public finance laws, including the supportive financial regulation, stores regulations and guidelines to reinforce this Bill. The only way we are going to regulate financial discipline is to first of all enact a law, which is what we are doing here. Secondly, we can improve the systems by applying the Integrated Financial Management Information System (IFMIS) and Treasury Single Window Account (TSA). Thirdly, we can also improve the systems by using institutions such as the Anti-Corruption Commission (ACC) and Drug Enforcement Commission (DEC) which are strong enough to ensure that they assist in the enforcement of the law.

Madam Speaker, it is, therefore, important that this House passes the Bill so that we can reverse the erosion of public confidence in the utilisation of public resources. We need to show that funds that are collected from taxpayers are used transparently with due accountability. That way, we are going to motivate taxpayers to be more compliant in paying taxes. Sometimes, compliance is affected when public confidence is eroded and people feel that public resources are not being used properly.

Madam Speaker, this Bill aims to correct a number of irregularities. For me, this is an effective starting point that will see the reduction in the volume of the Report of the Auditor-General year by year. It is hoped that eventually there will be no need for the Office of the Auditor-General because we shall be at the level of financial discipline and implementation that we desire.

Mr Livune: Question!

Mr Mutati: Madam Speaker, the ultimate goal is to put in place the necessary building blocks to realise the Vision 2030. This Bill is a primary vehicle for transporting the people of Zambia to the realisation of the vision.

Madam Speaker, I support the Bill and thank you.

Hon. Members: Hear, hear!

Mrs Mwanakatwe: Madam Speaker, I wish to thank the Chairperson of the Public Accounts Committee, the hon. Member of Parliament for Muchinga, for his statement. I thought he really did justice to his task. I also wish to thank your Committee for its report. I saw the array of witnesses and people who were called upon to give evidence and various perspectives to this Bill. I am thankful that your Committee was able to interrogate this Bill.

Madam Speaker, having said that, I also wish to thank the debaters of this Bill today, my fellow hon. Members of this House. I have heard the overwhelming support from each and every one of them and that is why I stand here to thank them. However, from their own perspectives, it is clear that their expectations are different. Nonetheless, all of their desires culminate into what this Bill is going to address. For instance, it is clear that all of them want proper accountability of public funds. I heard that in the debates of the hon. Members of Parliament for Zambezi East, Lunte and Liuwa. All of them want clear and proper accountability of public funds.

Hon. Members: Hear, hear!

Mrs Mwanakatwe: They all want to see sanctions properly instituted against erring officers, especially on financial misconduct. That is provided for in Clause 49(3), (4), (50) and (51) of the Bill. This clause provides for measures to deal with those that misconduct themselves regarding public finance management, especially controlling officers. The clause goes further to include controlling officers’ failure to take action on erring officers. So, this Bill really caters for erring officers and I know that hon. Members want to see sanctions properly given.

Madam Speaker, my colleague, the hon. Minister of Works and Supply, talked about the security of tenure for the Secretary to the Treasury and some hon. Members also talked about the qualifications for holders of this office. I am happy to say that we are going to include a section on this in Clause 49(5), just as we have done for judges and hon. Ministers, to ensure that the Secretary to the Treasury is covered in that regard.

Hon. Members: Hear, hear!

Mrs Mwanakatwe: I know that all the hon. Members want an effective Secretary to the Treasury. They want the Secretary to the Treasury to have the right qualifications. I am happy to say that we are going to include a clause on the qualifications of the Secretary to the Treasury.

Madam Speaker, I really appreciated the way the hon. Member of Parliament for Chinsali explained the importance of risk management, sealing leakages and internal controls. I think this Bill is all encompassing in those areas to ensure that we have a proper framework for management of public funds.

Madam Speaker, I wish to refer to some of the areas in the Report of the Public Accounts Committee. The Chairperson of your Committee talked about the inclusion of civil society organisations in audit committees. However, the Government feels that professional bodies are already members of audit committees. He also talked about the reduction of tenure for audit committees to two years from three years. We believe that three years is appropriate for stability and ensuring an appropriate learning curve for audit committees.

Madam Speaker, some hon. Members talked about the retention of unspent Constituency Development Fund. In this case, I wish to refer to what Hon. Mwale said in response to a question. I can confirm that money that was not spent the previous year, in this case 2017, can be spent in 2018. If funds are made available, you would have to seek supplementary approval in the same year. This was one of the issues that were raised regarding Clause 31 of the Bill.

Madam, I have already referred to the fact that we are going to ensure that the qualifications for the Secretary to the Treasury are going to be included in this Bill. I, however, wish to emphasise what Hon. Mutati said about the hon. Minister coming to the National Assembly to seek approval for grants and donations that have already been approved. It is true that once a grant or donation has been approved, there is really no need to come for the second time to the National Assembly for approval.

Madam Speaker, I wish to end here and, once again, express my gratitude to the Chairperson and hon. Members of the Public Accounts Committee for its report. I also want to thank all the debaters on this Bill today for their overwhelming support of the Bill.

I thank you, Madam Speaker.

Hon. Members: Hear, hear!

Question put and agreed to and the Bill read a second time.

Committed to a committee of the Whole House.

Committee on Wednesday, 7^th March, 2018.

THE NATIONAL HEALTH INSURANCE BILL, 2017

The Minister of Health (Dr Chilufya): Madam Speaker, I beg to move that the Bill be now read a second time.

Madam Speaker, universal health coverage is top on the agenda of the Global Health Policy and has been adopted globally as part of Sustainable Development Goal No. 3. The goal of universal health coverage is to ensure that all people have access to the needed promotive, preventive, curative and rehabilitative health services of sufficient quality to be effective without suffering financial hardship when accessing the services.

In recognition of the need to move towards universal health coverage and develop a sound and sustainable health care financing strategy, the need and rationale to establish a National Health Insurance Scheme is included in the Seventh National Development Plan (7^thNDP), National Health Policy and National Health Strategic Plan for 2017 to 2021.

Madam Speaker, our information systems continue to attest to the high burden of communicable diseases such as malaria, tuberculosis and Human Immunodeficiency Virus and Acquired Immune Deficiency Syndrome (HIV/AIDS). Furthermore, with the growth in the middle class, we have reached alarming levels of non-communicable diseases (NCDs), such as diabetes, hypertension, cancer, heart diseases and trauma due to road traffic accidents. Unless we implement robust evidence-based interventions, the cost of preventing and managing the diseases will only escalate. It is, therefore, our inescapable duty to strategise, innovatively fund and implement our plans in order to leave no one behind or allow them to face catastrophic expenditure or impoverishment at their time of need for health services.

Madam Speaker, Zambia’s transformative agenda for inclusive economic growth is premised on successfully enhancing human development, and the health sector contributes to this pillar by ensuring a healthy and productive populace. A healthy population will be wealthy. To answer to this call, we have responded by crafting the Health Care Financing Strategy whose cornerstone is the establishment of the National Health Insurance Initiative.

Madam Speaker, the National Health Insurance Bill, 2017, which was presented to Parliament on 8^th December, 2017, is as a result of a six-year journey of consultative processes, involving various stakeholders. The Ministry of Health sought wide consultation, expert advice and prudently invested in designing the National Health Insurance Model that will best suit the Zambian population as a whole. Numerous consultations, research and study tours have been conducted and many useful suggestions were received publicly and privately from the following stakeholders:

Government ministries and institutions;

trade unions;

Zambia Federation of Employers;

academia;

local and international experts;

health care professional association;

co-operating partners;

church mother bodies;

informal sector representatives from both rural and urban settings;

traditional leaders;

private insurance and health care industries; and

through a national household health expenditure and utilisation survey.

The majority of residents from all walks of life endorsed the establishment of the National Health Insurance Programme.

Madam Speaker, as far back as 2012, the Government of the Republic of Zambia and trade unions collectively agreed to abolish the Voluntary Health Insurance Scheme and establish a Compulsory Public Service Insurance Scheme after conducting feasibility studies. In response to this agreement, a joint technical committee (JTC) was formed to conduct feasibility studies and draft the legislative framework.

Madam Speaker, the JTC was set up by the Secretary to the Cabinet and comprised various stakeholders, including employers, unions and line ministries, our co-operating partners, consultants and informal sector representatives. Since 2012, the JTC, led by the Ministry of Health, made presentations and shared progress on the establishment of the National Health Insurance Scheme (NHIS), including the NHI Bill with members of the bargaining teams on an annual basis. This culminated in an annual renewal of the Collective Agreement on the establishment of the compulsory NHIS, which includes the recently signed 2018 Collective Agreement.

Madam Speaker, in addition to the consultative process, which we had carried out, we conducted feasibility and actuarial studies. We also conducted thorough research and assessments and, thereafter, developed a sustainable plan which fits our needs.

Madam Speaker, I am pleased to say that two actuarial studies were completed in 2008 and 2012 respectively. It is important to note that the results of the actuarial studies show that it is viable to have a NHIS in Zambia. However, it also shows that a health insurance scheme exclusively for the Civil Service cannot stand on its own. The decision, therefore, is to have a comprehensive single pool health system to cover all the Zambians. Reports on both studies showed that for the fund to be sustainable, administration costs should not exceed 20 per cent of the revenue fund.

Madam Speaker, it is important to acknowledge that less than 16 per cent of the labour force is in the formal sector. Workers in the informal sector will, therefore, form a significant proportion of members contributing to the NHIS. A group of people classified as indigent by the Ministry of Community Development and Social Services shall be exempt from making contributions towards the NHIS. However, the Bill provides that the Government should subsidise this group. We would like to assure hon. Members of this august House that the analysis and performance assessments will continue as we get actual data to be utilised during the implementation phase and we shall continually upgrade and fine tune the system in real time as we implement it.

Madam Speaker, the transformational agenda for the health sector is meant to change the landscape of how we do business. As stated, The intent is to attain equity of access to cost effective quality health services as close to the family as possible. We have gone further to state that this vision shall be shared in all corners of Zambia, hence our commitment to the provision of universal health coverage through the continuum of care that encompasses health promotion, prevention of disease, quality curative services, rehabilitative and palliative care.

Madam Speaker, the 2014 National Household Health Expenditure and Utilisation Survey reviewed that one in every 10,000 Zambian incurs catastrophic health expenditure at the time of illness, driving them into poverty. The establishment of the NHIS seeks to mitigate the need to pay out of the pocket at the time of illness and replace this with a system of affordable pre-payment into a single fund.

Madam Speaker, it is worrisome to note that only 3.9 per cent of the population has any form of health insurance cover. Risk pooling is almost non-existent and the uptake of private health insurance is low. This is partly due to the small formal sector and relatively undeveloped insurance market. Currently, there are no laws governing the operation of medical aid schemes or medical insurance. The few private health insurance firms that offer insurance to individuals and companies on a voluntary basis are fragmented, diverse and favour those in the formal sector and urban settings and those who are already better off.

Madam Speaker, to address this challenge, the compulsory NHIS that this Bill will introduce is a way of providing health insurance to cover all the 16 million Zambians, and thereby protecting households from the burden of catastrophic health costs through risk pooling. Based on a solidarity model, contributions from those who are healthy, young and wealthy will assist in subsidising health care for those who are ill, old and poor so as to avoid the double burden of illness and financial costs of care.

Sir, the NHIS will focus on ensuring the progressive realisation of providing quality healthcare by extending coverage of health benefits to the entire population in an environment that is resource-constrained whilst benefitting from the efficiency gains. Further, as a non-profit making and pro-poor initiative, the NHIS will help in supplementing the traditional tax based and donor funded mechanisms in the health sector by providing additional resources to the sector. It will increase inflows so that Government health expenditure per capita can make the desired trajectory to the recommended World Health Organisation levels that will enable us, as a country, to achieve universal health coverage.

Madam Speaker, allow me to refer to the Report of the Committee on Health, Community Development and Social Services. We acknowledge the report and recommendations made by the Committee on Health, Community Development and Social Services, appointed on 20^th September, 2017, on the ramifications of the National Health Insurance Bill, 2017. The ministry appreciates the observations and recommendations made by your Committee and will take note of the matters raised as we continue to refine the Bill.

Madam Speaker, I would like to take this opportunity to provide clarity on some of the pertinent issues raised in your Committee’s report.

Madam Speaker, as stated in my preamble, the ministry engaged in extensive stakeholder consultations, culminating in the Bill in its current form and continues to welcome constructive recommendations. The scheme will be managed by a single corporate body which will be supervised by a board comprising part-time members. To allay the concerns raised in the report of your Committee that this structure will be top heavy, ambiguous and bureaucratic, I wish to assure the House that the envisioned implementation will begin with a lean administrative structure supported by robust information and communication technology (ICT) systems to efficiently manage the day-to-day operations of the scheme. Further, as evidenced by the actuarial studies, the administrative costs of running the scheme shall not exceed 15 per cent of revenue with the majority of revenue going to cover the costs of insured benefits.

Madam Speaker, provincial and district officers of the authority will be established progressively as the scheme grows. It is also important to note that the scheme is non-profit making and pro-poor. Reserves from the scheme will be ploughed back into enhancing the services and benefits of its members. Accreditation of the purpose of this Bill has already been clearly defined and does not overlap with functions of the Health Professions Council of Zambia or any other entity. Accreditation of providers refers to placement of providers on a list of facilities that meet the criteria to be contracted by the authority for purposes of providing insured services. The Bill does not provide for the authority to license facilities to provide health services, as this function remains the sacred mandate of the Health Professions Council of Zambia. Health service providers will be given an opportunity to apply to join the scheme on a voluntary basis. So, no health service provider will be forced to join the scheme.

Madam Speaker, in conclusion let me reiterate that the Ministry of Health has listened to the many words of encouragement and concerns, and has carefully considered the contributions from various stakeholders on the Bill. Therefore, it is fair to say that some of the dissenting views being expressed about the specific design features of the NHIS can be expected in any healthy democracy. There are some who still hold on to the belief that universal health coverage could have been achieved by simply offering a Government plan to those without private insurance or just a select group of the population. One would understand why this concept would appear attractive at face value, but a deeper analysis reveals disturbing realities that have reared their ugly heads in various countries that have travelled this path.

The Government’s plans have taken into consideration the high disease burden in the country, the least ability to pay and the recipe for collapse of financial systems of various individuals’ out of pocket payments.

Madam Speaker, after years of research and analysis and taking into consideration our size and population demographics and economic structure, extensive studies have all pointed to the fact that full participation in a single-pooled system is the only sustainable option for universal health insurance in Zambia. Ensuring access to quality health care and financial risk for the protection for all citizens are issues of concern to every responsible Government and society. This Government is taking the right step to address financial barriers to health care access with the implementation of the National Health Insurance Scheme.

Madam Speaker, this Bill is, therefore, one component of a comprehensive strategy that will stir our health system in a new direction towards greater efficiency, improved quality, and financial sustainability as we continue to promote health, prevent disease and treat, and rehabilitate the sick in collaboration with other sectors. The National Health Insurance Scheme will escalate resource mobilisation for patient and community-centred primary health care investments in health infrastructure and technology, strengthening emergency medical health service system and building the health workforce along with regulatory and health financing reforms as we forge ahead towards our Vision 2030.

Madam Speaker, it is, therefore, my earnest appeal that this august House supports the National Health Insurance Bill, 2017.

Madam Speaker, I beg to move.

Hon. Government Members: Hear, hear!

Dr Kalila (Lukulu East): Madam Speaker, in accordance with Standing Order No.157, the Committee on Health, Community Development and Social Services considered the National Health Insurance Bill, 2017.

Madam Speaker, considering that hon. Members have read your Committee’s report, I will highlight just a few salient observations and recommendations contained therein.

Madam Speaker, from the outset, let me state that your Committee supports the principle of a National Health Insurance Scheme. Your Committee is aware that the intention of this Bill is to promote universal access to health care, reduce the inequality and provide equitable access to health for all the Zambians, especially the poor and vulnerable groups.

However, Madam Speaker, your Committee does not believe that the object of this Bill will be achieved if it is enacted in its current form. Having engaged with various stakeholders in order to acquaint itself with the ramifications of the Bill, your Committee is extremely concerned that almost all the stakeholders who appeared before it indicated that they were not consulted in the formulation of the Bill while some stakeholders informed your Committee that they were engaged at the inception stage through the Tripartite Consultative Labour Council discussions on the raft Social Protection Bill of which health insurance was a component. Other stakeholders denied having been engaged at all.

Madam Speaker, the first object of the Bill is to provide for sound financing for the health system. The object, as it stands, can be misleading because it has the potential to be misunderstood to mean that the National Health Insurance Fund will be the sole source of funding for the health sector, thereby impeding the allocation of adequate resources to this sector from the Treasury. Your Committee wishes to recommend that the object be recast so as to ensure that primary health care continues to be fully funded from the Treasury and be offered at no cost to all citizens.

Madam Speaker, your Committee further recommends that the Government endeavours to meet the Abuja Declaration of allocating, at least, 15 per cent of the National Budget to the health sector, notwithstanding the fact that there is established a National Health Insurance Scheme.

Your Committee further …

Madam First Deputy Speaker: Order!

As the time is 1910 hours, I interrupt the proceedings and the business stands adjourned.

________

The House adjourned at 1910 hours until 1430 hours on Thursday, 1^st March, 2018.

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