Liberia: Budgetary Approval vs. Salary Payments – Executive and Legislative Uproar
The country is currently going through a serious economic surgery at the moment and will only require the right legal and policy framework to come out successfully. What is currently unfolding between the first and second branches of government signal the lack of coordination in the body politics of the Country.
Under the advisement of the IMF, the Government embarked on a wage bill harmonization mechanism to remove the disparities within the salaries structure. With considerable efforts on the parts of the Civil Service Agency, the Ministry of Finance and other institutions, a definitive formula was developed.
Unfortunately, the harmonization exercise occurred at a time when the draft national budget was been submitted to the national legislature for review and approval; something that stalled the payment of salaries from May to July. Without the approval of the budget, the Government can only act on one-twelfth of the annual budget.
Civil servants’ salaries were placed on hold while the national legislature address some of the sticky issues in the proposed budget. With lots of domestic responsibilities including education, food and shelter needs, a decision had to be made, to pay or not to pay civil servants for the month of July. To not pay, would create economic chaos within thousands of households since the government at the moment is the highest employer. However, to pay would also lead to a violation of the law, given the fact that the proposed budget, including the new salaries structures have not yet been approved by the legislature.
Statements from few members of the House of Representatives seem to support the latter part of the “Lady or the Tiger” scenario. That the Executive Branch of Government will be taken to court for violation of the budget law sends a mixed signal.
One lawmaker on a popular radio talk show noted that the Minister of Finance and Development Planning should have waited until the approval of the budget before proceeding to pay civil servants. “We did not approve the new wage bill which provides for one civil servant, one salary” so the Minister should have waited a little while before making salaries payments.
But the Public Financial Management Act of 2009 is clear. Section 17 (Temporary Financing of the Budget and Adoption of the Budget) is unambiguous. It states that in the case where the Legislature is unable to adopt the National Budget before the start of the fiscal year, the Minister is authorized to collect revenues and approve expenditures, in line with the proposed budget.
The question of how long civil servants should have waited before been paid their July salaries was the sixty-four million dollars question posed by a caller. “Why are you people refusing to pass the budget, is it because your salaries and benefit were also slashed” the caller asked. Another rather infuriated caller questioned the rationale behind waiting for the passage of the budgetary before paying civil servants. “How will we pay our children’s tuition, while we wait for the passage of the national budget”.
These questions and comments form the crux of national decision making, especially with public policy at the center. Michael Foreman, a public policy expert noted that countries will always face these sorts of challenges in their decision-making architecture, but the bottom-line is that every decision coming from such an arrangement should first address the needs of the ordinary people.
A macroeconomist at the MFDP on an anonymous basis noted that the country runs the risk of not receiving 40m in budgetary support from partners if the wage harmonization process is not enforced. “We understand that there have been some minor problems in the payment process, but these can be resolved in the short-run” he noted.
We received calls from some employees who mentioned that their salaries were slashed by more than 40%, but we are working to address all of these problems in the soonest possible time. The wage harmonization will be accompanied by a robust reform mechanism to address all of the lapses in the shortest possible time. Portion of the 40m budgetary support will be used to fill in the gaps that may arise out of the harmonization process.
The wage harmonization as been on the shelf for a long period of time spanning the administration of the former government. It started but only considered few ministries and agencies to the disadvantage of other institutions of government. “Employees at Finance and Gender are making big money why we are getting peanuts. So, what’s wrong with the harmonization process”? asked a Desk Office at the Ministry of Foreign Affairs.
A driver at one of the ministries noted that he and his colleague made the same salary but different allowances. ‘We both earned US$350 per month. My allowance was LD$ 10,000 and my friend allowance was LD$56,000” and this was not fair at all” he noted. The story of the driver cut across all spectrum of government ministries and agencies with Ministers and Director using their discretionary power to determine allowances not solely only on the basis of ‘merit’ but wholly on the basis of ‘proximity or nepotism’.
The new wage harmonization which focuses on positions and not individuals also provide for additional income for several low wage earners in the society. While others are crying because of the removal of the discretionary allowances, there are others who are happy that their salaries have been increased.
Working as a single government, the People’s Deputies, must demonstrate their support for this worthy venture in spite of the legal ramifications associated. Because after all, they were elected to serve their people and if their people are not pay on time, it could mean problem for not only the Executive branch, but also the lawmakers. It is time for both branches to harmonized their differences and work for the common good of the Liberian people. Afterall, civil servants deserve better and the wage bill harmonization will pave the way for equity within government ministries and agencies.