Capitol Hill, Monrovia – When Dorbor Jallah, the Commissioner General of the Liberia Revenue Authority (LRA), announced before the House of Representatives in June that revenue generation was exceeding targets, the Legislature and heads of government institutions anticipated that this would be reflected in the disbursement of their appropriated funds.
By Gerald C. Koinyeneh, [email protected]
However, an analysis of the budget by the Senate’s Public Accounts, Expenditures, and Audits Committee (PAC) reveals that the Ministry of Finance and Development Planning (MFDP) did not disburse the appropriated funds for several key governmental ministries and agencies. Notably affected were the Ministries of Health, Education, Agriculture, and Infrastructure.
Health
The Committee reported that actual spending on Health for the first six months of the year was $24.8 million, representing 76% of the total allotment for the period but only 31% of the total appropriation of $80.1 million for the year. This slow disbursement of funds to support critical healthcare needs, including the purchase of medicines and vaccines for preventative care, is fiscally irresponsible, especially given the overperformance in revenue collection.
Education
The Committee noted that spending on education for the first six months of the year was $45.1 million, representing 85% of the allotment for the period, but only 40% of the total appropriation of $111.3 million for the year. While disbursements improved in the second quarter, the Committee called on the Ministry of Finance to do more to ensure essential funding to support the country’s educational requirements, including support for schools and teachers.
Social Services
Spending on social services, including children’s and social protection, for the first six months of the year was $3.9 million, representing 85% of the allotment for the period but only 15% of the total appropriation of $26.3 million, the Committee said. “This low level of disbursement for protection against violence for women and children, youth activities, refugee repatriation, and other social services reflects a ‘do-not-care’ attitude towards this sector and the people,” the Committee stated.
Agriculture, Energy & Infrastructure
Spending on Agriculture, a key pillar of the ARREST agenda for inclusive development, was only $1.9 million, representing 76% of the allotment for the period but just 21% of the total appropriation of $8.8 million for the year. Similarly, spending on Energy & Environment and Infrastructure remained low, at 19% and 43% of their respective total appropriations of $26.3 million and $54.2 million.
Spending on Public Sector Investment Projects (PSIP) for the semester was only $20.3 million, or 21.3% of the total appropriation of $95.1 million for the year. This reflects the government’s low prioritization of investment projects that are essential for expanding the economy and creating opportunities for Liberians, the committee noted.
Recommendations
The Committee called on the Ministry of Finance and Development Planning (MFDP) to prepare clear and credible budget performance reports in the future, avoiding errors that undermine the credibility of its reports and delay legislative discussions and decision-making. The MFDP should also ensure that budget execution aligns with revenue performance and the prevailing state of the economy. The Committee further urged the Ministry to collaborate with spending entities to increase payments to basic social service providers and the protection of women and children, especially during the rainy season when hardships increase.
Additionally, it recommended that the MFDP deploy fiscal officers to critical spending entities to assist with the preparation of necessary documents, accelerating disbursements to support the economic cycle, enhance government effectiveness, maintain household spending power, and ensure payments to businesses for goods and services rendered.
Overall Spending
The Committee highlighted that 80.5%, or $258.9 million, was disbursed against an allotment of $321.5 million for the first semester of the year. This translates to a disbursement of 35% of the total appropriation for the year, which is approximately 12% behind the expected spending in relation to revenue collection.
Spending on salaries and wages for the first semester stood at 78.5% of the allotted $156.4 million, but only 41.1% of the total appropriation for the year. “This indicates that many civil servants may have faced delays in receiving their salaries, which is a concerning issue,” the Committee noted.
Spending on vital sectors, like Agriculture, Health, Energy, and Infrastructure was not prioritized in the first half of the year judging by the amounts disbursed. These sectors are essential parts of the government’s ARREST agenda for inclusive development. And, comparing year-on-year spending, overall spending for the first six months was down 32% this year against last year’s same period. Spending on goods and services and capital expenditures were significantly lower this year than in the same period last year.
Senate Public Accounts, Expenditures and Audits Committee
Moreover, the Committee pointed out that spending on vital sectors like Agriculture, Health, Energy, and Infrastructure was not prioritized in the first half of the year, based on the amounts disbursed.
“These sectors are essential components of the government’s ARREST agenda for inclusive development. However, comparing year-on-year spending, overall expenditure for the first six months was down 32% this year compared to the same period last year. Spending on goods, services, and capital expenditures was significantly lower this year than during the same period last year. This decision by the fiscal authority to withhold spending is counterproductive to the prevailing economic environment and undermines revenue performance,” the Committee stated.
According to the Committee, this austerity approach to fiscal policy is contractionary, meaning it could slow or reduce aggregate demand, harm the economic cycle, and lead to losses for businesses, reduced taxes on goods and services, job losses, and dissatisfaction among citizens in an economy projected to grow by 5.6% this year.
