Rwanda Civil Servants Set for Pay Rise in June

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By Daniel Sabiiti

Rwandan civil servants are set to receive a salary increase from June this year after government indicated that government expenditure will increase by more than Rwf 140 billion in the coming financial year 2017-18.

This year’s proposed budget for fiscal year 2017/18 is Rwf2, 094 billion, which is Rwf140.7 billion higher than Rwf1, 954.2 in the 2016/17.

Spending will rise to Rwf 2,094 billion (about $2.6billion) from Rwf 1,953 billion of the FY ending this June, according to the Budget Framework Paper delivered by Finance Minister Claver Gatete today morning.

“The increase is attributed to rise in wages and salaries” of the public sector due for implementation in the next budget, said Gatete.

From this budget, 83 percent of the budget will the domestic product with 66 percent from revenues and 17 percent from loans and grants.

Rwanda’s Minister of Finance and Economic planning, Amb. Claver Gatete said that Rwanda is planning on becoming a financial hub and the budget will implement infrastructure and projects aimed at increasing access to financial services and delivery.

With an inflation at (8.1percent)- the highest ever in Rwanda, and high borrowing interest rates from local banks, Gatete said that Rwanda needs to contain the rates and increase financial services local and move on to the global levels to have a competitive economy.

This year’s budget will mainly see an increase in health services and facilities, infrastructure development and skills development.

The proposed total budgeted resources for fiscal year 2017/18 amount to Frw 2,094 billion, which is Frw 140.7 billion higher compared to Frw 1,954.2 in the 2016/17 revised budget. The resource allocation is line with EDPRS 2 priorities and it is expected to contribute towards attaining EDPRS 2 targets as well as forming the basis for Vision 2050 and EDPRS 3

The 2017/18 domestic revenue is projected at Frw 1,316.8 billion; representing an increase of Frw 130.5 billion compared to Frw 1,186.3 billion in the 2016/17 revised budget. Total grants are estimated at Frw 356.7 billion compared to Frw 326.6 billion in 2016/17 revised budget indicating Frw 30.1 billion increase.

Total external loans are estimated at Frw 362.8 billion in 2017/18 and shows a decline of Frw12.3 billion compared to the estimate in 2016/17 revised budget on account of revised projections based on the status of the execution of projects.

Recurrent expenditure is expected to increase by Frw 111.7 billion from Frw 1,028.0 billion in 2016/17 revised budget to Frw 1139.7 billion 2017/18 fiscal year. This rise is attributed to increase in wages and salaries of Frw 42.7 billion, resulting from the implementation of the new teachers’ statute, new government agencies as well as restructuring.

Development budget is estimated at Frw 757.2 billion in 2017/18 from Frw 741.9 billion in the 2016/17 budget representing Frw 15.3 billion increase. Domestically financed development projects expenditure is set to increase by Frw 46.7 billion from Frw 398 billion in 2016/17 to Frw 444.7 billion in 2017/18. The increase will be used to purchase of strategic stocks for food security, construction of several valley dams and cater for expropriation for the construction of the Bugesera airport

The minister said that Rwanda is already in position to achieve this target basing on established financial services, like the credit reference bureaus, capital markets, pension funds, and Agaciro development fund, and dissemination of ICT based financial services among others.

“All we need to put all financial services online, and we plan on copying expertise from Jersey Financial Services- which is a small population but handling large sums of money which is more than what most African countries with big populations have” Gatete told parliament while presenting the draft Budget Framework Paper for 2017/2018 -2019/2020.

Compared to other regional countries, Rwanda’s budget is small but accountability has made Rwanda rank second at the global level, after Mauritius civil society organisations want Rwanda to change the budget bill to allow citizens to access the draft budget bill before it’s presented to parliament.

The draft budget has been approved for discussion in Parliamentary committee and it to be resubmitted by May 30th 2017, before the Minister of Finance presents the final Budget Framework Paper for 2017/2018 -2019/2020 in June this year alongside other East African countries.

 

 

 

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