Liberia: Wage Bill Hits All Time High Despite Salary Cut
Monrovia – When President Weah announced pay cut for cabinet members on April 25 this year, aspiration was that monies saved from the reduced wage bill would be redirected to other meaning people-driven projects in support of the pro-poor agenda, but that seems not to be the case.
Report by Lennart Dodoo, [email protected]
Both the House of Representatives and the Senate ratified the FY 2018/19 National Draft Budget which has an increased wage bill of US$310 million compared to US$296 million that closed the regime of former President Ellen Johnson Sirleaf.
The total budget of US$310 million for compensation in the FY 2018-19 draft National Budget represents over 50 percent of the overall US$570 million Budget.
Speaking on the much-heralded pay cut in May this year, Finance and Development Planning Minister, Samuel Tweah said, the pay reduction demonstrates the government’s commitment to promoting efficiency in the allocation of resources and has been a major driver in the reduction of compensation costs down to US$303.4 million from US$308 million. According to him, extra savings would be used to venture into improving the infrastructure sector.
However, the Budget as passed by both Houses runs contrary to the previous pronouncement.
How Did It Go Up?
Sources within the Finance Ministry confided to FrontPageAfrica that the impact of the salary reduction has made no impact on the Budget because of the indiscreet mass employment carried on the CDC regime.
The mass employment, according to a source, has led to duplication of functions under different job titles at various government ministries and agencies.
“The CDC administration brought in a lot of their members and spread them across various government ministries and agencies. And because the President promised not to sack anyone, new positions had to be created in some instances though someone is already employed to do that job. Now, government has to source funds to pay the extra employees,” the source said.
It can be recalled that shortly after assuming power, the new chairman of the ruling establishment began sending out lists of party remembers to various government ministries and entities recommending their employment.
At the Liberia Water & Sewer Corporation alone, 28 names were recommended for various position – consultant being the dominant and so was the case at other ministries and entities like the Liberia Petroleum Refining Company (LPRC), Liberia Revenue Authority (LRA), Liberia Maritime Authority (LiMA), National Transit Authority, amongst others.
The Center for Policy Action and Research (CePAR) on Wednesday reacted to the increment in the wage bill, noting that it confirms their earlier analysis that the compensation would increase due to the mass employment in government.
“Government is not a welfare institution for political parties. The CDC-led government needs to come to terms with the idea that the resources of the government cannot be used to employ its partisans at the expense of basic social services,” the group noted.
They lamented that this is happening at a time the country is going through economic turmoil and prices of goods and services are skyrocketing.
According to the local research group, which of course comprise some former officials of the past government, the increase in the wage bill will affect basic social services.
“CePAR sees why conditions at hospitals, educational institutions and other state-run deliveries are extremely affected. It must be stated that activities at the CB Dunbar Hospital in Bong County were recently brought to a halt because of the inability of health authorities to fuel the generators running the hospital. It can be recalled that surgeries, at night, at the St. Timothy Hospital in Grand Cape Mount County had to be conducted using torchlights and health workers had to only attend to cases when patients fuel the hospital generators,” they noted.
However, at the passage of the Budget, the Chairperson of the House’s Committee on Ways, Means, Finance and Development Planning, Rep. Thomas P. Fallah (Mont. District #5) acknowledged that although there are enormous challenges grappling the country and its people, the passage of the budget would mark the beginning of positive changes.
“We know the demand and needs of our country and its people are enormous. The envelope is tight, but with an anticipation that our economy will have a sharp growth in terms of our revenue. Most of our basic social services, infrastructures, health, education and all sectors of our government can be impacted on a positive direction,” he stated.
The Montserrado County lawmaker noted that the passage of the budget within its constitutional time frame will be a historic moment for both the Executive and Legislative branches as there has always been delay in the passage of the draft budget in recent years; something he said can have an adverse effect on the government and its people.
What is in the budget?
The House of Representatives made slight changes to the version submitted by the Executive branch.
In the House’s version, out of the total US$570.148 million, recurrent expenditure amounts to US512 million or 89. 8 percent (MFDP version was US$488.7 or 87 percent); while Public Sector Investment Plan (PSIP) covers US$58.08 million or US$10.2 percent (MFDP version was US$73.4 million or 13 percent).
The recurrent expenditure is primarily used to fund government’s administrative and routine operational cost. It comprises of the following US$310.4m for compensation of employees, including provisions for new staffs from the security, health and education sectors; and US$91.1million for goods and services, including educational and essential health supplies.
Others within the recurrent budget include US$63.9 million in grants to government and non-governmental service delivery entities; US$30 million for debt service and US$0.048 million for social benefit and US$15.12 million for non-financial assets relevant to road maintenance and the acquisition of new assets for government’s operations.