GOVERNMENT has delayed disbursing funds allocated under the 2024 National Budget due to the recent introduction of the Zimbabwe Gold (ZiG) currency, Finance, Economic Development and Investment Promotion minister Mthuli Ncube has said.
He said the ZiG, launched through the Reserve Bank of Zimbabwe governor John Mushayavanhu’s monetary policy statement early last month, had delayed the release of the 2024 budgeted funds.
Appearing before the joint Parliamentary Portfolio Committee on Budget and Finance and Industry and Commerce yesterday, Ncube said the delay had also been caused by the reprocessing of documents recorded using the abandoned Zimdollar.
“Delay in budget release and cash release has been on the past, but I have ordered that the system be changed and be driven by cash flow,” he said.
“The introduction of ZiG will delay release because we had a budget announcement denominated in RTGS [real time gross settlement] and in April this year we announced the ZiG in the middle of the month.
“Because of the documentation and balance processes that were ready we could not release funds because of changing to ZiG.”
Ncube said Treasury had to convert documents from RTGS to ZiG currency.
“This ZiG introduction has delayed disbursements of funds, but I have been assured that they are changing it. At the time of presenting the budget last year, the exchange rate was going up and also when there was the introduction of the ZiG, the exchange rate had ballooned.
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“So clearly there was an erosion of the budget, but the exchange rate and inflation also cut both ways, when the exchange rate was weakening the inflation was going up, revenues were also increasing,” he said.
Ncube, however, added that the overall erosion of the local currency was not as large as was perceived since revenue was also rising.
Ncube said he would also introduce a ZiG budget next month, adding that there was no need for a supplementary budget.
“We want to increase the value of ZiG, so, in this regard a supplementary budget will not be necessary,” he said.
