President Michael Sata says the removal of the subsidy on petroleum products will enable the state to have more finances available for spending and guaranteeing proper implementation of all government programmes and projects.
The President said it is necessary that the subsidy on petroleum products, which has been a burden on state coffers for a long time, is removed and consequently the price of fuel adjusted upwards in order to attract wider social benefits for the general populace.
Mr Sata said in 2012 the treasury redirected resources amounting to KR 754 million from implementation of other programmes and activities in the budget to finance the fuel subsidy.
President Sata further noted that for the 2013 budget, government has already paid a sum of KR571.5million in fuel subsidies as at January 18, 2013, adding that an estimation of about K1.1 trillion will be paid in 2013 as subsidies if no adjustment is made to the price build up or the pump price.
This is contained in statement made available to ZANIS in Lusaka today by Special Assistant to the President for Press and Public Relations, George Chellah.
The President noted that people may wish to know that the estimated K1.1 trillion subsidy can go a long way in financing the construction of more than 100 new rural primary schools or over 120 new rural health centres to help the majority marginalised Zambians.
He further explained that the funds are diverted from expenditure on social sector and infrastructural development that if spent would have accelerated poverty reduction and employment creation especially for the youths.
Mr Sata said the removal of the subsidy will also make more finances available for spending and guarantee job creation and the development of the infrastructure such as schools, universities, hospitals as well as the Link Zambia 8000 project, which will open up the rural areas for increased trade and investment.
The Head of State added that the decision will also make funds available for the upgrading of Indeni Oil Refinery to enable it process pure crude oil which is cheaper to import and will result in cheaper imports by about US$10 million while providing other by – products to be used in plastic, road and fertiliser industries.
President Sata said he is confident that the overall short and long – term benefits to Zambians of this action outweighs, by far, any perceived negative consequences.
The President said in its pursuit to improve the livelihood of all Zambians, the PF government remains committed to ensuring that there is a transparent and equitable distribution of resources to all sectors to facilitate greater economic growth.
Meanwhile, President Sata is this Friday expected to flag off the commencement of the construction of the 61km Chalimbana road project, another project under the Link Zambia 8000, which will provide shorter route to the Leopards Hill road passing through Chiawa to Chirundu.
On the same day, the Head of State is also expected to lay a foundation stone for the construction of Chalimbana University which is a part of his vision to overhaul and develop the education system by increasing the number of public universities as espoused in the PF manifesto.