National Assembly to approve loans
… As State plans to repeal Loans and Guarantees Act
GOVERNMNET says it will present a bill that will seek the approval of the National Assembly for all Government borrowing during this session of the National Assembly to repeal the Loans and Guarantees Act in line with the provisions of the constitution.
Article 282 (2) of the constitution provides that Government shall not borrow, guarantee or raise a loan on behalf of itself or any state organ, state institution, authority or person except as authorised by or under an Act of Parliament.
Clause (3) of the same article explains that notwithstanding clause (2) Government shall lay before the National Assembly, the terms and conditions of the loan which shall not come into operation unless approved by a simple majority vote of the National Assembly and pay any money received in respect of the loan paid into the consolidated Fund or into some other public fund which exists or is created for the purpose of the loan.
Presenting the 2018 national budget to Parliament yesterday, Finance Minister Felix Mutati said to enhance transparency and good governance, the bill will be presented to Parliament to give power to the National Assembly to authorise loans as enshrined in the constitution.
“The Bill will provide for enhanced oversight over the borrowing activities of the Government by having the National Assembly approve loans before they are contracted. This is in line with the provisions of the Constitution,” Mr. Mutati said.
He also explained that Government was also reviewing the Bank of Zambia Act, the National Payment Systems Act, and that a depositor protection bill was also being drafted and will be presented to Parliament.
“Mr. Speaker, with respect to insurance, the Government will repeal and replace the Insurance Act to strengthen governance and financial soundness. The Bill also seeks to implement micro insurance and require citizens to insure locally, serve for re-insurance
“Government is finalising the development of the financial sector development policy. Its overall objective is to have a well-developed, competitive and inclusive financial system that supports efficient resource mobilisation and access to financial services and products by all. The policy will promote financial stability, financial inclusion and deposit protection, among others,” Mr. Mutati said.
Mr. Mutati said Government will over the next five years implement the National Financial Inclusion Strategy whose overall objective is to increase access and usage of a broad range of quality and affordable financial services.