DEVELOPMENT PLANNING

A Plan is an intention or set of suggestions aimed at achieving a certain goal in future.Development

 Evaluation of the progress achieved under the preceding plan

 Raise the rate of economic growth

 Is the statement of the general objectives of economic and social policy

 To solve the current economic conditions.

 Current social conditions

TYPES OF DEVELOPMENT PLANNING

Plans fall under three categories namely; short, medium and long terms planning as follows:

1. Short Term Planning

Is a type of plan that covers a short period of time from usually from six (6) months to one (1) year. It is
also referred to Annual National Plan. It is not a substitute of others but governed by Medium and long
term plans that set the direction. The biggest problem of the short term planning is;

 excessive projections; this can happen when government publishes the plan on merely propaganda
exercise without intending to be bound by it.

 listing what the country’s needs are rather than what the country is capable of doing

 it can ignore the amount of resources likely to be available; this can happen when the plan is made by
wrong people.

 The plan may be made to please the public or please the foreign aid administrators without ever
intending to implement the plan.

2. Medium Term Planning

This is a type of planning that ranges from three (3) to seven (7) years, with five (5) years the most
popular choice. The main aim of the medium term development planning is to move towards self-
sustaining growth. In the medium term planning government identifies priority areas for development.
Some of the aims of Medium development planning are:

 diversify the economy to reduce dependency on one product

 increase the value of the nation‟s own output

 stabilise the economy

 periodically review the exchange and interest rates

 maintain reasonable price stability

 develop new sources of energy, transport and communication, etc.

3. Long Term Planning

This is a plan that covers the period from ten (10) to twenty (20) years. It is sometime

called long range development planning. Long term Development planning begin with the

assessing of the what the economy can do, rather than by asking what it would do to meet

that desirable goal such as increasing the employment rate Usually long term planning is

made for projects such as:

 construction of hydro –electric power station

 reforestation

 opening new mines

 construction of new roads and railway lines

METHODS OF PLANNING

The methods of planning can be divided into Centralised and decentralised.

a) Centralised Planning

This is the kind of planning done by the central government without the involvement of the

local community. It is one where the control of the plan is centralised at one place. Centralised planning
is an economy where decisions on what to produce, how to and for whom are taken by central
government, experience from developing countries, however, have shown that centralised planning
have not succeeded. The living standards of people have declined. The following are the problems
associated with it are:

 locals are not involved e.g. centrally planning may bring crops in a given area

 it disregard local conditions

 local coordination is often impossible

 decisions are usually delayed

 Priorities of central government are not the priorities of the local level.

b) Decentralised Planning

This is a kind of planning that is done by involving the local community. The local community identifies
the project to be undertaken at community level by taking into consideration the community needs, e.g.
the community may need a school or hospital. After planning in the centralised planning, the budget is
drawn and submitted to the central government for funding.
Levels of planning

Planning takes place at all levels. It can be individual, community and national levels. A plan must be
flexible. A good plan should not make the assumptions far from reality. Individual /Family planning: Is a
plan for a specific period time of time indicating estimated income and expenditure on a given project. It
is a family activity which may involve resources such as hoe, fertilisers, plough and paying labour.

Community of planning: Is a type of a plan that involves community members, E.g a plan to build a
school by the community. This plan may involve, collecting of sand, stones, cement etc.

National of planning: Is a plan made by the government on how to execute a certain programmes. It is a
plan for future of the country.

BUDGET

A budget is an estimate income and expenditure. A good budget should balance between the
expenditure and income. Budget plays an important role in determining the economic performance of
the country. In Zambia Article 117 of 1996 of the Laws of Zambia mandates the Minister of Finance to
present the National budget to the National Assembly. The budget is presented every October and
begins to operate the following year in January. In order for the government to operate in the first
quarter of the financial year, a provincial warrant is issued and signed by the president.The National
budget is divided in quarterly of three year framework for which the resources are distributed between
the sectors in order to achieve government objectives. This is called Medium Term Expenditure
Framework (MTEF). The MTEF budgeting and planning helps the preparation process to start early. It
ensures that all spending are activity based.

Budget Process

Before coming up with a budget it undergoes several stages. Here are the stages

Stage 1: this is the drafting of the green paper by compiling requirements from the several ministries
and other departments.

Stage 2: The green paper is consolidated and submitted to the cabinet for approval after which the
green is printed for circulation.

Stage 3: The ceilings are sent to all ministries, provinces and spending agencies together with the
timetable for discussion. This enables different sectors to contribute or make suggestions for inclusion.

Stage 4: The cabinet again meets (president chairs) to discuss the suggested inclusions or proposals from
the sectors. The printed budget speech and the estimates of the revenue and expenditure is also called
yellow book.

Stage 5: The budget is then presented to the National Assembly for approval

Budget Execution

To ensure the programme implementation, the Ministry of Finance and National Planning

informs the ministries and spending agencies (MPSAs) quarterly on the release of the funds.
Legislation: After the budget has been presented to the National Assembly, 2 bills are prepared

and to present in the National Assembly and these are Supplementary Appropriation and the

Excess Expenditure Appropriation bills.

General Warrant (GW): is a document to be signed by the president giving an order or

authority to the Secretary to the Treasury to release the funds for all programmes. This GW replaces the
provincial warrant (PW)

Monitoring and Evaluation of the Budget

The Monitoring and Evaluation of the Budget is a responsibility of key stake as follows:

i. controlling officers (heads of government department)

ii. Accountant General- analyses the expenditure returns by ministry, province and spending

agencies

iii. Auditor General- audits the public funds on yearly basis

iv. The Monitoring and the Evaluation unit at the Ministry of Finance

Budget and Fiscal Discipline:

Fiscal discipline means strict control of the public resources. This is done by cutting

expenditures and directing its resources to essential areas such as education, health and

agriculture.

INTERNATIONAL FINANCIAL INSTITUTIONS AND THEIR FUNCTIONS

These are institutions that give assistance to countries and individuals. These are divided into

Micro and Macro Financial Institutions.

Micro Financial Institution

These are small financial institutions that give assistance to countries and individuals and entrepreneurs
to start small scale projects such farming in puts, purchase of houses etc.

Examples of these are

 Bayport

 Izwe loan

 Blue Finance

 Unity Finance

 MICROFIN
Macro Financial Institution

These are large financial institutions that give assistance to countries and individuals and entrepreneurs
to start large scale projects such as school, drilling bore holes etc. Examples of these are

International Monetary Fund (IMF)

IMF is a specialized agency of United Nations (UN) which was set up in 1944 to provide fund.

The objectives are;

 promote international monetary cooperation

 to promote stable exchange rates and maintain orderly exchange arrangements

 shorten period of balance of payments of member states

 promote full conversion of currencies between nations

World Bank

The international Bank for Reconstruction and Development (IBDR).It was formed at Brentwood
Conference in 19 44. Its operation started in 1946 and its aims are. Member states pay subscription
according to their Gross National Development

 Encourages capital investment for construction and development of all member states.

 gives loans for specific projects and that are productive

 loans are usually paid for a period of 20 years and grace period being 5 years

African Development Bank (ADB)

African Development Bank was formed in 1963 and began operation in 1966. Headquarters are in
Ethiopia. The bank receives contributions from African and African countries. It gives concessionary
loans. A concessionary loan is money given without strings attached. Aims are;

 loans are given for specific project that are productive loans are usually paid for a period of 20 years
and grace period being 5 years

 gives technical advice and to capital project to be undertaken

 gives grants to member states to finance projects in education and health Arab Bank for Economic
Development in Africa (ABEDA)

The Bank was set up by Arab League formed in 1973 and began operation in 1975. Headquarters are
Khartoum Sudan. Aims are;

 loans are given for specific project that are productive loans are usually paid for a period of 20 years
and grace period being 5 years

 gives technical advice and to capital project to be undertaken

 gives aid on concessionary terms for project not exceeding USʂ15 or 40% of total project costs
Generally projects are financed jointly with other international lending institutions such as

World Bank

Indicators of Development

Are signs or measures that show a country is developing or not or improvement in the people’s

basic needs such as; food, clothes etc. Examples of Indicators of Development are;

1. Gross National Product (GNP)

Is a total value or measure of production in monetary terms during a period of time. It is the amount of
goods and services produced within and outside the country in particular year

2. Gross Domestic Product (GDP)

Is a total value or measure of production in monetary terms during a period or the amount of goods and
services produced within country in particular year

3. Human Development Index (HDI)

It is a measure of human development using four items:

 life expectancy at birth

 adult literacy

 average years of schools

 purchasing power of persons aged 25 years and above expressed in dollars

4. Per Capita Income

It the amount of goods and services in terms monetary a person gets from one‟s country‟s total
production. It is the Gross National Product (GNP) of the country divided by population

ZAMBIA NATIONAL DEVELOPMENT PLANS

From 1964 – 1991Zambia has had several National Development Plans

1. The Emergency Development Plan (EDP)

It was launched immediately after independence. The aims were;

 To restructure the inherited colonial capitalist economy.

 Designed to lay a viable administrative structure

 Provide a framework for more comprehensive programmes of economic and social

development in Zambia.

2. The National Development Plan (NDP)

This plan covered the period from 1965 to1966. The aims were:
 Extend transport and communication services

 Improvement of agriculture and education services (Primary schools and Secondary

were built in each district

3. The First National Development Plan (FNDP)

It covered the period from 1966 to 1970. The aims were:

 Diversify the economy from mining to agriculture and manufacturing

 Develop rural areas

 Expand education services

 Expand welfare societies

 Improve transport and communication

 Create 100,000 jobs by 1970

4. The Second National Development Plan (SNDP)

This covered the period from 1972 to 1976. The aims were:

 Attaining self-sufficient food supplies and improvement of income

 Expanding and diversifying industry and mining through import substitution by using

local materials.

 Initiating measures for regional development

 Linking educational programmes to the country‟s manpower requirements etc.

5. The Third National Development Plan (TNDP)

Covered the period from 1980 to 1983: The aims were;

 Investment of funds to transform society through humanism

 involve private sector in economic and social development

 distribute income fairly and creating an egalitarian(communal) society

 diversification of the economy and rural development

 expanding educational and training facilities to speed up Zambianisation

6. The Fourth National Development Plan (FNDP)

Covered the period from 1984 to 1989. The aims were;

 Emphasis of the use of local materials for production and the gradual reductions of

subsidies
 Review of the exchange and interest rates

 Reducing price controls

 Reduce inflation rates

 reduction of the budget deficit to below 2% of the GDP

7. Transitional National Development Plan (TNDP)

In 2002 the government re introduced the National Development Plans it was expected to run from
2002 to 2005. The major aim was to reduce poverty and debt burden. To do this a Poverty Strategy
Paper (PRSP) was introduced. Poverty Reduction Paper (PRSP) 2002 to 2005. The programme was
started by International Monetary Fund (IMF)

The concentration was:

 Cross cutting issues

 Education

 Healthy

 Agricultural

 Macro-economic issues

However the programme or development plan could not cover security sectors such as:

 Police and defence

8. Vision 2030

This is a long term plan aimed at making Zambia a prosperous middle income nation by

2030. To do this, the government is to

 Be gender responsive

 Respect for human rights

 Have good traditional and family values

 Be peaceful

 Be public partners

Some of the Aspirations of Vision 2030 are

 Well maintained and developed infrastructure

 Technological proficiency

 Strong entrepreneur skills

 A conclusive macro-economic environment for growth

9. Fifth National Development Plan (FNDP)

The Fifth National Development Plan was based on the Vision 2030. It focuses on broad

based wealth and job creation through citizen participation. It covers the period from 2006

– 2010. Some of its aims are:

 Develop and rehabilitate infrastructure

 Develop human resource and capacity building

 Promote rural electrification

 Promote investment

 Promote accountability and transparency

 Develop small scale and large scale mining

 Develop and promote flexible and inclusive education programmes to take care of Children with
Special Needs (CSEN), School Health Nutrition (SHN), Orphaned and Vulnerable Children (OVC) and HIV
and AIDS

 Establish the E-Government ICT Application, etc.

10. Sixth National Development Plan (SNDP)

The SNDP covers a period between 2011 - 2015. It aimed at building on the gains of the

FNDP in the process of attaining the Vision 2030. The theme of the Sixth National

Development Plan was, "sustained economic growth and poverty reduction". The

objectives of the SNDP were accelerating:

 Infrastructure development

 Economic growth and diversification

 Rural investment and poverty reduction

 Enhance human development

Following the objectives above, the plan aimed at addressing the challenges of realising

broad based pro-poor growth, employment creation and human development.

11. The Seventh National Development Plan (7NDP)

The plan covers the period 2017 - 2021. Its theme was, “Accelerating development efforts

towards the vision 2030 without leaving anyone behind”. The 7NDP was a vehicle to fulfil the United
Nations Sustainable Development Goals (SDGs) which is a universal call to end poverty, protect the
planet and ensure that all people enjoy peace and prosperity. It was also a tool for actualisation of Smart
Zambia by making use of ICT for development. The following are objectives of the 7NDP:

 Recognizing the impact of climate change on development and its threat to human kind

 Promoting the adoption of agricultural environmental-friendly practice

 Building new capital city, more roads and plant 500,000 hectares of trees across the

country

 Recapitalising various industries e g Mulungushi textiles and Kawambwa tea company

 Promoting cultural transformation

 Utilisation of natural resources

 Fostering good neighbourliness and nurturing extended families

 Addressing issues of moral decay

12. The Eighth National Development Plan (8NDP)

The Eighth National Development Plan (8NDP) covers the period between 2022 - 2026.

The theme for 8NDP is, “Social economic transformation for livelihoods”. The main aim of this plan is to
improve the efficiency and competiveness of the economy to sustainability and lifts the living standards
of people. The objectives or goals of this plan are to achieve:

 Economic transformation

 Job creation

 Human rights and social development

 Environmental sustainability

 Good governance environment

The plan is further designed to unlock the country's immense prospects of all the sectors of the
economy for sustainability, holistic and inclusive national development with the aim of retuning to vision
2030, that is becoming prosperous middle income nation