Monrovia – The Liberia Revenue Authority (LRA) has alarmed over default payment of more than US$14M by three autonomous government agencies: the Liberia Petroleum Refinery Company (LPRC), National Port Authority (NPA) and the Liberia Maritime Authority (LMA).

Report by Henry Karmo – henry.karmo@frontpageafricaonline.com

In the Budget Forecast of 2016/2017, it was expected that the LPRC would have paid into government account  US$43M but paid  US$24M, NPA, should have paid US$ 2.5 but paid US$ 1.5 M and Maritime US$ 11.5 and paid US$7M.

At the opening of the budget hearing, Madam Elfreda Stewart-Tamba requested the Legislature to put in place mechanism that would ensure a transparent collection of revenue from the three government entities into the National Budget.

For his part the Chairman on the Joint Committee on Ways, Means, Finance & Budget, said his committee will work harder despite the shortness of time for the 2017/2018 Draft Budget to be approved before July 1, 2017.
The estimated revenue projection for the 2017/2018 Budget is US$526m.

Rep. Prince Moye warned ministries and agencies of government to be punctual at every hearing.

The House’s Chairman on Ways, Means, Finance & Budget who is also a Bong County lawmaker said the Joint Committee had planned the Revenue Component for a week, which will run from Monday – Friday, June 5 – 9; and then the Expenditure Component will be another week, beginning Monday – Friday, June 12 – 16.

He said the Joint Committee will take the third week in June to analyse the budget for subsequent passage of the 2017/2018 Draft Budget.

Rep. Moye made the assertions on Monday, June 5, during the formal opening of the 2017/2018 Draft Budget Hearing in the First Floor’s conference room.

“Even though the time is short, but we will work harder and carefully to pass the budget,” Rep. Moye said.

According to the Budget Law, the Liberian fiscal calendar runs from July 1 to June 30.

The Acting Co-Chairman of the Joint Committee on Ways, Means, Finance & Budget, Senator Henry Yallah, said the Committee will not tolerate rescheduling of Ministries and Agencies.

For his part, the Deputy Finance Minister for Fiscal Affairs, Adolphus Forkpa, said the total draft resource envelope is US$526.5M; the core revenue is US$523.5M and the contingent revenue is US$2.9M.

Mr. Forkpa said the total revenue in Liberian Dollars amounts to L$57.3M, at the projected annual average exchange rate of US$1 to L$109.

Monrovia – Liberia is currently faced with the inability to raise its 2016/2017 National Budget of over US$600 million – thanks to several unscrupulous lump sum budgetary allotments to non-existent institutions.

Report by Lennart Dodoo –  ldodoo@frontpageafricaonline.com

In some cases, institutions owned by ‘greedy’ officials of government, who are bent on siphoning public funds into their pockets at the detriment of the suffering masses, are looting the budget discreetly.

Until the ascendency of Amara Konneh as Finance Minister in 2011, Liberians were unfamiliar with the term ‘budget shortfall’, but there have been three consecutive budget shortfalls since he became the country’s exchequer while President Ellen Johnson Sirleaf has said her government might not be able to raise over US$40 million of the US$623 million for Fiscal year 2016-17.

Preliminary findings from an ongoing investigation being conducted by FrontPageAfrica has so far established that there are several non-existent institutions placed in the budget to receive subsidies from government while there are other existing ones belonging to officials of government.

The first phase of FrontPage Africa’s probe of the Budget found out that US$40,000 was allotted to a certain Jallah Lone Memorial High School in FY 2015-16 and US$50,000 allotted to Fred Davis Clinic in Gbarpolu.

However, FrontPage Africa preliminary investigation established that these institutions do not exist.

Cross checking the facts, FrontPage Africa contacted the President Pro-Tempore of the Liberian Senate, Senator Armah Zolu Jallah, who hails from Gbarpolu County and he informed this paper that he was not aware of any Jallah Lone Memorial High School named after his deceased father and a Fred Davis Clinic.

However, no allotment was made to the ghost school in the FY 2016-17 National Budget.

“I know of Chief Jallah Lone to be technical and vocational school that will encompass both the academic school and technical school.

Don’t know of Fred Davies Clinic in Gbarpolu,” Sen. Jallah informed this paper via a text message.

However, documents in the possession of the FrontPageAfrica show that disbursements were made to Jallah Lone Memorial High School during FY2015-2016.

The first payment of US$8,000.00 was paid on October 8, 2015 under approved voucher number 56704.

The check issued was numbered 3267. A second installment of US$11,999 was paid on the same date with approved voucher numbered 56706 with check number 756.

Third installment was made under approved voucher number 74437 on May 17, 2016; the check issued was numbered 3470 making a total overall payment of US$39,999 during the Fiscal Year.

Credible sources within the Finance Ministry informed FrontPageAfrica that the checks were and signed for received by one Isaac Varmah who represents himself as the administrator of the school. FrontPageAfrica has not been able to independently verify this information.

Though investigation is still ongoing, FrontPageAfrica has reliably learnt that there are so many non-existent institutions listed in the budget mainly under the health and education sectors where monies directed to these unknown and unidentified institutions go in the pockets of a group of cohorts.

Gbarpolu County already has massive infrastructure challenges, and infighting amongst the members of the county legislative caucus over the years has made it difficult to foster development in the county.

As these details unfold and the economic situation of the country continues to deteriorate, considering that the prices of Liberia’s main exports have dropped, it is almost certain that achieving this fiscal target is impossible.

Many economists and government’s critics have slammed government for spending most of its budget on recurrent expenditure, but with corruption taking center stage and eating up the fabric of public financial management law fading, or being gravely misused by top government officials.

Monrovia – President Ellen Johnson Sirleaf has approved and signed into law the National Budget for the 2016/2017 fiscal year, which runs from July 1, 2016 to June 30, 2017, US$600,204,076.

Of the total amount, US$524.9 million would be raised from taxes and non-taxes revenue; US$50.2 million in grants from external resources while unspent revenue from the FY2015/16 comprising US$2.0 million would be rolled over to the current fiscal year.

Irrespective of the decline in the 2016/17 National Budget, key sectors with net increases in appropriation for direct support to the country’s social service delivery plan embedded in  the Agenda for Transformation (AfT) and the Economic Stabilization and Recovery Plan (ESRP) include health, agriculture, education and transparency.

The National Budget is apportioned between Recurrent Expenditure in the amount of US$520.5 million or 86.7% and the Public Sector Investment Projects (PSIP) with US$79.7 million or 13.3%

The key sectors which received substantial share of the total resource envelope include: Security US$94.8 million; Education US$86.2 million; Health US$77.4 million; infrastructure US$42.2 million; and agriculture US$11.9 million.

The release indicated that Government has maintained increased spending of US$34.6 million for ongoing road reconstruction works and maintenance, renovation of public buildings as well as US$4million for energy expansion and distribution.

Also, as a manifestation of its commitment to ensuring a smooth transition with the holding of a free, fair and transparent presidential and legislative election in 2017, US$20 million has been appropriated as government’s direct support to the National Elections Commission. 

The health sector would receive US$77.4 million compared to the actual spending of US$72.6 million in the last budget year.

Additionally, other key areas, programs and entities that are slated to receive the needed funding in this year’s annual National Budget include: the University of Liberia, US$16 million; Water, Sanitation and Hygiene (WASH) services would receive US$2 million; Coastal Defense and Beach Cleaning, US$1.4 million; Tubman University and Booker Washington Institute, US$1.2 million.

US$10 million is being allotted to support UNMIL’s drawdown plan, while US$1 million is being appropriated for the Household Income and Expenditure Survey.

Monrovia – The Legislature has finally passed the National Budget 2016/2017, sending it to the Executive for signature. The decision was reached Thursday when the Senate concurred with the House of Representative on the passage of the budget.

Despite harsh economic outlook characterized by drastic fall in the prices of essential commodities on the world market adversely affecting Liberia, the legislature approved a budget with additional US$46M putting revenue collectors in the position to collect US$600M, which if realized will be the highest revenue generation by the Sirleaf led administration in a single year.

Increase in the national budget comes after President Ellen Johnson Sirleaf and other officials of the ruling Unity Party warned that the country will experience a bad economic situation in 2016 going toward the 2017 election.

Delivering her 11^th Annual message on the State of the Republic on January 25, President Sirleaf expressed that the Liberian economic is under severe stress and warned Liberians of difficult times.

Announcing the approval of the 2016/2017 budget by the House of Representatives, Representative Prince Moye chairman on Ways, Means and Finance committee announced that the body sourced additional $46 million funding increasing the amount from US$550,992,598.00 to 600,203,674.00.

The Plenary of the House of Representatives unanimously endorsed a report from its Specialized Technical committee to pass the Fiscal Year 2016/17 National Budget.

According to the body, the decision was taken based on recommendations contained in a report to the Honorable Body.

In the final report to plenary the committee recommended that excise taxes on alcoholic beverages, water, soft drinks: amendments to section 1120 and section 1140 and excise taxes on mobile telephone usage be rejected.

The committee also recommended that section 1165 be rejected because the first count contravenes the WTO agreement that Liberia just subscribed to; while the second count will increase the cost of economic challenges.

Monrovia – Liberia has a recent history of successive budget shortfalls where relevant agencies of government have not been able to generate the needed revenue in line with the amount approved by the National Legislature.

Despite harsh economic outlook characterized by drastic fall in the prices of essential commodities on the world market adversely affecting Liberia, the House of Representatives has approved a budget with additional US$46M putting revenue collectors in the position to collect US$600M, which if realized will be the highest revenue generation by the Sirleaf led administration in a single year

During the fiscal year 2015/2016, the Executive Branch of Government submitted a budget of US$604,040M but the National Legislature approved US$622,743,420 and before the end of the fiscal period the government experienced a budget shortfall where the Ministry of Finance announced austerity measures to resolve the deficit.

During the 2014/2015 budget year the outbreak of the deadly Ebola virus impacted revenue generation and that budget year was one of the worse where donors had to help fill the huge gaps.

Before Ebola, the government projected a budget of US$557M to be collected in 2014/2015 but by the time Ebola struck, the financial records were in disarray as the government used the situation to go out looking for support.

For over nine years the government has been experiencing budget shortfalls resulting to recast budgets and with the prices of major commodities down on the world market the government is projecting that it will be able to collect US$600M.

The Executive branch through the Ministry of Finance and Development Planning submitted a proposed budget of US$555.9M but the House of Representatives has now increased the amount to US$600 million.

Contradictions in economic situation

Increase in the national budget comes after President Ellen Johnson Sirleaf and other officials of the ruling Unity Party warned that the country will experience a bad economic situation in 2016 going toward the 2017 election.

Delivering her 11^th Annual message on the State of the Republic on January 25, President Sirleaf expressed that the Liberian economic is under severe stress and warned Liberians of difficult times.

 “Consequently, real GDP growth declined further to 0.3 percent in 2015 compared to the original forecast of 6.8 percent,” she noted, stressing that the foundation of economic diversification already set in place by her administration could not, in the short run, absorb these unforeseen shocks.

Despite the President warning about eight months ago, the House of Representatives has now set the budget at US$600M.

Announcing the approval of the 2016/2017 budget by the House of Representatives, Representative Prince Moye chairman on Ways, Means and Finance committee announced that the body sourced additional $46 million funding increasing the amount from US$550,992,598.00 to 600,203,674.00.

The Plenary of the House of Representatives unanimously endorsed a report from its Specialized Technical committee to pass the Fiscal Year 2016/17 National Budget.

According to the body, the decision was taken based on recommendations contained in a report to the Honorable Body.

On May 14, 2016, The Executive submitted the sum of five hundred fifty million, nine hundred ninety-two thousand, five hundred ninety-eight (550,992,598.00) United States Dollars in for Legislative approval but the fiscal instrument has been languishing before the lawmakers for nearly three months due to wrangling over leadership.

After weeks of indoor and public scrutiny of both the revenue and expenditure components of the Draft National Budget by the Specialized Technical Committee along with the relevant line Ministries and Agencies, over forty six million (46,000,000.00) was identified as additional and unencumbered revenue, the House of Representatives declared.

This amount according to the Technical Committee was undercut by the removal of One Million Nine Hundred Two Thousand United States Dollars (1,902,000.00) from the draft budget on account of uncertainty surrounding adjusted tax revenue

These adjustments therefore according to the Committee ensured a net effect in terms of additional and unencumbered revenue of over 44 Million United States Dollars (44,211,076.00)in both core and contingent revenue, thus bringing the total adjusted revenue for Fiscal Year 2016/17 to Six Hundred Million, Two Hundred Three Thousand, Six Hundred Seventy-Four United States Dollars (600,203,674.00), which if the body said if converted into Liberian dollars would amount to Fifty Seven Billion, Three Hundred Nineteen Million, Four Hundred Fifty Thousand, Eight Hundred Fifty Thousand, Six Hundred Sixty-Seven Liberian Dollars (57,319,450,867.00) at the exchange rate of L$ 95.5 to US$1.00.

Reject increment in taxes on Alcoholic beverages

In the final report to plenary the committee recommended that excise taxes on alcoholic beverages, water, soft drinks: amendments to section 1120 and section 1140 and excise taxes on mobile telephone usage be rejected.

The committee also recommended that section 1165 be rejected because the first count contravenes the WTO agreement that Liberia just subscribed to; while the second count will increase the cost of economic challenges.

The committee report stated: “Honorable Deputy Speaker/Presiding officer, and distinguished colleagues, with the rejection of the two amendments, and the insertion of the amendment to the 1708 of the Revenue Code of Liberia act 2000, and goods tax is 10% of the section 1004 taxable amount, except that if the supply is an export of goods the rate of the tax is 0%.”

The committee also claimed that excise tax at the rate of 80% of the amount determined under subsection shall be levied on tobacco and on any product containing tobacco including cigarettes, cigars, snuff, chewing tobacco and similar products whether imported   or manufactured in Liberia.

“Honorable Presiding, and distinguished colleagues, if these measures are considered, more than 21 million United States Dollars will be raised to support the FYY2016/17 draft National Budget; while the rejection of the two amendments will cost more than 9.1 million United States dollars,” the committee said.

Representative Moye told Journalists that as usual the health sector got the huge portion of the budget but failed to state the exact amount.

“The consolidation has to be made bulk of the money it went to health sectors. On the look of things if you see the draft budget you will see that health and Education are budget that take bulk chunk of the budget,” Representative Moye said.

No holistic civil servants benefit

Responding to question about increment in civil servants salaries he said, salary increment was not done holistically for all civil servants but increment was done in specific areas.

“We took over a task and we didn’t want to discount the work they did but to validate some of those issues,” Representative Moye said.

He also told reporters that there was no increment made in the budget of the legislature but claimed that the budget for the office of the speaker was retained.

“We cannot not appropriate at the detriment of the Liberian people we did all the restoration in the speaker budget that position is for the national legislature regardless of his recusal we had to restore his budget while we go through the stalemate” the lawmaker said.

History in Making

When the $600 million is realized by the government, it will be the first time the Sirleaf led administration is realizing such huge goal in revenue generation.

With the prices of busy commodities on the decline and Liberia unable to generate sufficient income from iron ore, rubber and other commodities generating revenue of US$600 million will be a huge task for the government to achieve.

During previous budget years when prices of these commodities were high, the government yet could not generate such amount of revenue within a fiscal year.

Monrovia – Economies in West Africa are projected to perform poorly during the latter part of 2016 going into 2017 and Africa’s biggest economy, Nigeria has already slummed into recession, raising fears that other economies in the region might perform far worse than expected.

Liberia has gone two months without an approved budget for the year 2016/2017 and the crisis is predicted to get worse as two different group of lawmakers are separately reviewing the same financial instrument which could likely see the country going deep into the year without implementing major projects and programs 

 For Liberia, two main shocks- the effects of the deadly Ebola virus and the global decline in the prices of Liberia’s two primary export commodities,   rubber and iron ore are taking a toll on the country’s economy.   

According to the Central Bank of Liberia, Liberia’s economic growth rate was a measly 0.3 percent in 2014 and 0.7 percent in 2015.   

Adding to the country’s economic woes is the political bickering based upon parochial interests at the Legislature, which is likely to push the country into further financial crisis.

According to economist Samuel P. Jackson, if not for the flow of personal inward remittances, which was $658 million US dollars in 2015 to Liberians from the Diaspora, the economy would crash by now.  

“Personal inward remittances are the new social protection for developing nations. They provide a floor that prevents some developing countries such as Liberia from sinking into deep depression even from bad economic policies. 

Annual personal inward remittances to Africa surpass the amount of official development assistance.   It protects bad economic policies of governments. Liberians should thank their families and friends abroad for providing their livelihoods while government officials bicker,” Mr. Jackson exclaimed.     

The Legislature has not been able to deliberate and pass into law the draft budget for 2016/2017 due to fight over leadership change, forcing the country to operate for the last two months on one-twelfth (1/12) of the budget for 2015/2016.

 Liberia’s Public Finance Management Act of 2009 provides for the country to only use one-twelfth (1/12) of its past budget when the budget for the current fiscal period is yet to be approved by the National Legislature. 

 Part III, Budget Preparation and approval Section 17 Temporary Financing of the Budget and adoption of the budget by default states “In the case where the Legislature is unable to approve 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, up to one twelfth (1/12) of the Budget of the previous fiscal year. Expenditure of said (1/12) by the Minister shall be included in the subsequent financial out-turn”.

 Projects stalled

The budget operates over a 12-month period July 1 to June 30 and with two months already gone in the current fiscal year.  The government has only ten months left to implement programs and projects for which funding are allotted in the current budget.

In the case where the government is operating only up to one twelfth (1/12) of the last budget, major programs and projects are not implemented with the government focusing mainly on payments of salaries for employees and other minor expenditures. 

Government is unable to pay vendors and as the major player in the economy, this is resulting into economic stagnation. 

President Ellen Johnson expressed frustration over delay in the passage of the budget which is also causing delay in implementation of several projects as time is against her administration with less than two years left to make good on numerous promises.

“I wish to bring to the attention of your Honorable body that programs under our agenda for Transformation, including several long standing draft legislations critical to our development have been stalled by the activities of the Legislature over the last few weeks.

This has also led to little progress on the 2016/2017 Annual Budget”, President Sirleaf stated in a letter to deputy Speaker Hans Barchue who is heading the anti-Tyler lawmakers or the ‘majority bloc’.

 In an apparent effort to have the lawmakers review the budget, President Sirleaf, acting on a certificate of extension issued a proclamation extending the stay of the lawmakers at the Capitol for another one month but it now seems that effort might not solve the problem with the lawmakers still divided on which group to review the budget.

One budget separate reviews

The impasse at the House of Representatives at the 53^rd Legislature has taken a new twist as the sparring bodies Anti-Tyler and Pro-Tyler blocs have taken separate and contrary decisions on the draft national budget 2016/2017 currently languishing before the Legislature.

 In the session conducted by lawmakers claiming to be majority bloc, they agreed to suspend their rules and constitute themselves into a committee to conduct hearing into the budget. 

The motion, raised by Dr. Edward Forh (CDC-District #16 Montserrado County), called for the current committee on ways, means and finance of the House to be dissolved.

The decision was endorsed by that plenary. Lawmaker Forh’s motion was prompted by the failure of the majority bloc to get at least one lawmaker from 3 of the 15 counties including Grand Gedeh, Grand Cape Mount and Bomi, which makes any review of the budget unconstitutional.

 Article 38 of the constitution provides for the committees on revenues and appropriations to consist of one member from each county.

 Article 38 states – “Each House shall adopt its own rules of procedure, enforce order and with the concurrence of two-thirds of the entire membership, may expel a member for cause.

Each House shall establish its own committees and sub-committees; provided, however, that the committees on revenues and appropriations shall consist of one member from each County. All rules adopted by the Legislature shall conform to the requirements of due process of law laid down in this Constitution”.

 Pro-Tyler take another decision 

 In the other session presided over by Speaker Alex Tyler, a communication from Representative Moses Kollie, chairman on the Ways, Means and Finance Committee of the House of Representatives was read, asking for an   extension of one month to conclude hearing on the budget and that communication was endorsed by plenary.

 Representative Kollie announced to the media that as chairman on the Ways, Means and Finance Committee and in consultation with other committee members of the senate, they will resume budget hearing on the country’s 2016/2017 fiscal budget.

 According to Representative Kollie, they have already concluded hearing on the revenue component of the Budget and were about to start on the expenditure component before officials of the Executive were instructed by President Ellen Johnson Sirleaf to play a neutral role in the ongoing crisis at the House of Representatives, something that has stalled the process.

 Section 54 of the House’s standing rules gives the chair and co-chair of statutory committees to serve for 3 years and could be removed for abandonment of function by 2/3 of the members of the House of Representatives.

 The Draft National Budget for 2016/2017 of US$555.9 million comprises US$495.5 million for Core Domestic Revenue; US$30.2 million as Grant; and US$30.1 million as Contingent Domestic Revenue.

 Prior to the President submitting the budget, the Cabinet, approved the Draft National Budget of over US$600-million, representing Domestic Revenue of more than US$400-million, Grants/Budget Support of more than US$66-million, borrowing of over US$58-million, and a surplus from last year’s budget of over US$13-million.

 The Cabinet also agreed on key areas of expenditure to include debt repayment amounting to US$32.5-million, payment of salaries across the Government of US$252.1-million and, Social Development Fund and other pass through US$23.2-million

 Key areas of expenditure also include, Health Sector Strengthening US$73.0-million, Education Sector Support US$79.4-million and, Security and Rule of Law US$90.1-million, including US$15-million for UNMIL Transition, as First Claims on the resource envelop.

 Others include the Government of Liberia’s (GoL) contribution (Counterpart Funding) to ongoing donor financed public investment projects through loans and grants amounts to US$24.5-million, and GoL Grants and Transfers to various institutions and entities that contribute to Liberia’s socio-economic reconstruction US$85.7-million.

 In support of major Public Sector Investments, intended to advance Liberia’s post-Ebola recovery, growth, and development, the Cabinet agreed to fund road construction and maintenance at the cost of US$44.3-million, including US$17.3-million as GoL contribution to donor funded projects.

 The Cabinet also agreed to fund renovation of public buildings at the cost of US$9-million, expansion of electricity at US$2.4-million, district development projects throughout the country (through the National Legislature) at  US$10.9-million, and water & sanitation US$2.3-million.

 Beach & waterways cleaning at US$1-million, human capacity-building US$2-million, private sector development US$1.5-million, National Low Cost Housing project (US$1.5 million, and LWSC Water Project US$1.0-million were other key areas the Cabinet also agreed on in the current budget.

 Other key areas considered in the draft budget by the Cabinet include renovation works at BWI US$1-million, renovation works at Tubman University (US$1-million, and a host of other key interventions critical for the delivery of social services and economic transformation.

 Road, electricity projects delayed

 Projects such as funding for road construction and maintenance at the cost of US$44.3-million, fund for renovation of public buildings of US$9-million, expansion of electricity at US$2.4-million, district development projects throughout the country (through the National Legislature) at US$10.9-million, and water & sanitation US$2.3-million all will be stalled as the budget year continues to elapse.

 The Revenue Code of Liberia provides that any amount of money not expended during the course of the budget year has to be carry forward by June 30, the end of the budget year. 

 Section 2217 of the Revenue Code of Liberia Act of 2000 as amended in 2011 on disposition of un-obligated balances states that “unless an appropriation is specifically designated as a multiple year appropriation, the unobligated balances of each appropriation authorized in any supplemental appropriations acts shall revert to inappropriate surplus at the end of the fiscal year for which such appropriation is authorized and shall not thereafter be available for obligation or expenditure except by subsequent legislative enactments.

The balances of appropriation obligated but not disburse prior to the end of the fiscal year shall be carried over and added to appropriations for the next succeeding year and shall be available for any other purpose”.

 As per this provision, any amount not used during the budget year will be carried forward to the 2017/2018 budget year.

 On Wednesday Nigeria slipped into recession with the latest growth figures showing the economy contracted 2.06% between April and June.

Monrovia – As the controversy over the current 2016/2017 budget continues with reports of withdrawal of the draft budget by the President to make adjustments, a FrontPageAfrica investigation has uncovered more than US$ 3 million allotted over the last three budget years to a dormant entity.

Report by Samwar Fallah; samwar.fallah@frontpageafricaonline.com; Selma Lomax, selma.lomax@frontpageafricaonline.com & Edwin Genoway, Edwin.genoway@frontpageafricaonline.com

The Liberia Opportunity Industrial Center (LOIC) which has been dormant over the last years is one entity that has been allotted millions of dollars over the last three budget years with no report of performance. From 2014   to current, the LOIC has been allotted over US$3 million.   

The Liberia Opportunity Industrial Center (LOIC) which has been dormant over the last years is one entity that has been allotted over US$ 3million over budget year with no report of performance by the LOIC.

The LOIC is not recorded in the detailed budget session but rather appeared in the summary with more than US$ 1 million allotted the entity every year over the last three budget years.

In 2014, the LOIC was allotted US$548,121 while during the 2015/2016 budget year the entity was again allotted an amount of US$1,055,000.

With no detail of how the LOIC expended budgetary allotments during the last two budget years like it is done with other entities, the LOIC budget has increased by over US$100,000.

In the national budget every receiving entity of budgetary allotment has a breakdown of its activities broken down into mission, achievements for the previous year, Objectives for the ensuing budget year but there is no such information available for the LOIC in the last three budgets even though the entity was allotted money.

In the current draft budget the entity is allotted US$1,100,000 with no reports of performance during previous budget year.  

During the last three years the LOIC which was established to provide vocational training for Liberians has not been able to implement its statutory mandate despite receiving budgetary allotments.

FrontPageAfrica in an attempt to ascertain the activities of the LOIC for which it continues to get budgetary allotment visited the entity offices in four counties including Montserrado, Bong, Grand Bassa and Bomi Counties.

In Montserrado in the New Matadi Estate Community, Mr. Solomon King, LOIC Executive Director when quizzed to provide a detail of some of the programs undertaken by the LOIC over the last few years, virtually abandoned his office every time he was told FrontPageAfrica reporter was at his office.

All efforts to get King provide updates about the LOIC projects and the entity operations, could not materialized as he kept postponing.

On Thursday August 4, 2016 when FPA reporter went to the LOIC head office in New Matadi Estate to get Mr. King to talk, he refused as his security brought message that his boss said he could not talk until Friday August 5, 2016.

Our reporter again visited the LOIC on Friday and met the security who said his boss instructed him to inform FPA that he will be available on Monday August 8.

On Monday when our reporter visited for the third time, Mr. King said he was in long meeting and could not talk to the press and asked that the interview be done on Wednesday August 10, 2016.

On Wednesday when our reporter went to the LOIC, he (reporter) was asked to wait until he is announced to Mr. King.

After almost 45minutes of waiting a lady came out of Mr. King’s office and said “Mr. King cannot talk to you today because his schedule cannot permit him as he has a long meeting to attend so you can come back by next week or when we are ready we will call you,” as she walked away.

Gbarnga LOIC Employees Threaten Go-slow

In Gbarnga, Bong County during a FrontPageAfrica visit at the local office, about 22 workers threatened to abandon job in demand of salary arrears owed them by the Government of Liberia.

The workers told FrontPageAfrica that they have not been paid since September 2015 despite several promises by the central administration of the LOIC.

FrontPageAfrica investigation further established that the workers are due a little over US$ 25,000 for the period.

The teachers and support staff said the situation is bringing untold suffering to them, especially in the wake of the current economic crisis facing the country.

The Gbarnga LOIC staff also said, the institution currently lacks essential training materials and students’ meal has been suspended for the past four months, a situation that is badly effecting enrollment.

When contacted the manager of the Gbarnga LOIC Pastor Peter Tooman, could not deny nor confirm the issue of the workers’ salaries but said the central administration of the LOIC in Monrovia has been informed about the challenges confronting the school in Gbarnga.

As per its enabling enactment, the Liberia Opportunity and Industrialization Center is to provide vocational education for youths in the areas of carpentry, mason, plumbing, cosmetology, computer and Tailoring among others.

Also in Grand Bassa County, the local office of the LOCI looks abandoned.

One source informed FPA that the LOIC has been dormant over the last few years and has basically been implementing smaller projects for non-governmental organizations that normally sponsor students in vocational training.

In 2012, more than 50 vulnerable and war affected youths were awarded certificates following the completion of vocational skills training programs offered by the LOIC and sponsored by the National Oil Company of Liberia (NOCAL).

Pepperbush?

A legislative source told FrontPageAfrica that LOIC has been a hidden treasury for Speaker Alex Tyler and some senior members of the Ways, Means and Finance Committee of the House of Representatives.

According to the source, every budget year the LOIC is not invited during budget hearings to defend its budget but the entity is allotted money with no performance report.

“The head of LOIC is a friend to the Speaker, they always put that money there and later they get lion share back, go and check, the LOIC is very dormant but they still get a million dollar every year that is a lot of money”, the source added.

Reports of budget manipulation have increased during the current draft budget before the National Legislature with reports that the President has recalled the budget to make some changes.

The news surfaced after the cabinet warned officials of the Executive from engaging in budget manipulations following a cabinet meeting.

In a statement following a cabinet meeting, an Executive Mansion release quoted the Cabinet “Cabinet, has carefully reviewed the status updates on key benchmarks in the areas of roads, ports, water & sanitation, education as well as Task Force performance covering agriculture and agro-processing and manufacturing and business support; threatened punitive action against any member of the executive involved in budget manipulation and mandated a vigorous and aggressive Sector Ministers-led Town Hall meeting education and information-dissemination campaigns”.

But reacting to the cabinet statement recently, Menipakei Dumoe, Secretary General of the LPDP indicated that the statement by cabinet is a confirmation that President Ellen Johnson Sirleaf condones corruption.

Said Dumoe: “The cabinet statement confirms that the President condones corruption. If she knows ministers are bribing certain lawmakers then she should be prosecuting those persons involved and not simply warning them”.

Monrovia – Three ministries on Monday boycotted the ongoing budget hearing for fiscal year 2016/2017 in the wake of rumors that President Ellen Johnson Sirleaf has decided to withdraw the budget currently before the Legislative Joint Committee on Ways, Means and Finance.

Report by Henry Karmo – henrykarmo@frontpageafricaonline.com

The Ministries of Labor and Commerce failed to show up Monday before the committee without an excuse. According to Montserrado County District #2 Representative, Sekou Kanneh, Co-chair of the committee, with the exception of the Ministry of State for Presidential Affairs which sent an excuse since the death of its former head, the Ministry of Commerce stayed away without any written excuse.

Concerns were raised about the emptiness of the seats in the joint chambers where it was expected that representatives from the ministries and agencies would have been seated by 2:00PM, the regular starting time for budget hearing.

No knowledge on budget withdrawal

Asked what was the committee’s view on rumors about budget withdrawal by President Sirleaf, he claimed not to have any knowledge about the information, saying the President usually writes the Legislature if she needs them do things.

“Not to my knowledge. As far as I know, the process is ongoing even though some of the Ministries expected here today did not show up. What is clear is that we will close for agriculture break by the 31 of August and if the President needs us back, it is constitutional for her to ask us to do so,” he added.

Frontpageafrica Monday reported that in a rather rare but bold move, President Ellen Johnson-Sirleaf is poised to recall the 2016/2017 draft budget this week, just a week after convening a Cabinet meeting during which she threatened punitive action against any member of the Executive involved in budget manipulation.

Multiple sources have confirmed to FPA that the President is on the verge of recalling the budget she submitted to the House of Representatives on June 2, 2016.

According to one source close to the Executive Mansion, the President has been contemplating this move ever since cabinet issued a warning to its members about budget manipulations.

The source explained: “As the administration comes to an end the President is keen for the budget to reflect more of her priorities, including energy, roads and other critical infrastructure.”

“With a not too rosy economic outlook the President wants to tighten the budget and do more from the executive end to prevent unrealistic revenue forecast leading to inflated expenditures which may not be in the national interest”, one Executive Mansion told frontpageafrica.

Frontpageafrica   also reported that it has learned that the President has asked Mr. James Kollie, Deputy Minister of Finance for Administration to resign.

The President, it can be recalled, on July 31, 2016, accepted the resignation of the Comptroller and Accountant General of the Republic of Liberia, Mr. Sekou A. Sanoe and appointed Mr. Hanson Kaizulu as Acting Comptroller and Accountant General with immediate effect. 

During last week’s Cabinet meeting, ministers expressed concern about budget manipulation and warned members that anyone found in breach would be punished.

The Cabinet mandated that punitive action awaits any line Minister who engages in budget manipulation process while being subject to the vetoing of the specific unauthorized appropriation, which runs contrary to the draft budget originally submitted to the National Legislature.

BUDGET MANIPULATION for any nation is a serious offense. In Brazil, it led to the premature ouster of President Dilma Roussef by the Lower House of Congress which accused Rousseff of using accounting tricks in managing the federal budget to maintain spending and shore up support. Dilma had charged that previous presidents used similar maneuvers and stressed that she has not been charged with any crimes or implicated in any corruption scandals.

ALTHOUGH DILMA RECEIVED a boost this week when a report prepared by analysts in the Brazilian Senate found that there was no evidence to suggest she was personally responsible for fiscal wrongdoing, the saga in Brazil shows the serious implications budget manipulations can have on a country.

IN LIBERIA, the issue came to light during a recent Cabinet meeting when President Ellen Johnson-Sirleaf mandated that punitive action awaits any line Minister who engages in budget manipulation process while being subject to the vetoing of the specific unauthorized appropriation, which runs contrary to the draft budget originally submitted to the National Legislature.

THE DRAFT NATIONAL Budget for 2016/2017 of US$555.9 million, comprises US$495.5 million for Core Domestic Revenue; US$30.2 million as Grant; and US$30.1 million as Contingent Domestic Revenue. Prior to the President submitting the budget, the Cabinet, approved the Draft National Budget of over US$600-million, representing Domestic Revenue of more than US$400-million, Grants/Budget Support of more than US$66-million, Borrowing of over US$58-million, and a surplus from last year’s budget of over US$13-million.

FRONTPAGEAFRICA REVELATION MONDAY drew some strong reservations from Mr. Isaac Redd, Director of Press and Public Affairs at the Lower House of the National Legislature who concluded that the President can either work her concerns out with her Budget Committee at the Ministry of Finance and Development Planning or veto part or whole of the budget but cannot recall the budget once it is with the Legislature. 

SAID REDD: “If there is any such thing like budget manipulation it has to be done with the branch that implements the budget. Under our laws, it is the very Executive. If she does act ultra-virus and recalls the budget, which is possible, she will be undermining her programs and projects for 2016/2017 because she can’t spend outside an approved budget.”

PART II, SECTION 2 (2) OF THE PUBLIC FINANCIAL MANAGEMENT ACT IS CLEAR THAT: “Except for the authority to submit the Proposed Budget to the Legislature, the President may delegate to the Minister, any of the authorities and powers conferred to the President under this Act, subject to terms and conditions specified by the President at the time of the delegation, Such delegation, however, does not discharge the responsibility of the President with regard to this Act.”

Section 6 STATES: “(Authority and Responsibilities of theirs); No monies shall be drawn from the treasury except in consequence of appropriations made by legislative enactment and upon warrant of the President; and no coin shall be minted or national currency issued except by the expressed authority of the Legislature. An annual statement and account of the receipt and expenditure of all public monies shall be submitted by the office of the President to the Legislature and published once a year.”

AMID THE DEBATE over the powers of the executives, some constitutional scholars say there are two types of powers inherent in the authority of the President: Express and Implied. The executive powers clause of the constitution vests the government and sovereign powers to manage the country in the hands of the President.

THE BUDGET LAW requires the President to submit a budget to the Legislature once each year. In practice the budget is submitted as a bill. The power to recall is implied in the executive authority of the president concurrent with the requirement to submit a budget. That is, the president can recall the budget for revision at any time before it is passed by the legislature. Typically, the budget negotiation should cure any defect in the budget. But this extraordinary use of this implied power shows that the president’s concern over legislative manipulation aided by certain members of the executive is so grave, she wants to do a top down review of the submission. Implied powers concept is based on:

IMPLIED POWERS, in the United States, are those powers authorized by a document (from the Constitution) that, while not stated, seem to be implied by powers expressly stated.  For example, when George Washington requested Alexander Hamilton to defend the constitutionality of the Bank of the United States against the protests of Thomas Jefferson, James Madison, and Attorney General Edmund Randolph, Hamilton produced what has now become the classic statement for implied powers by arguing that the sovereign duties of a government implied the right to use means adequate to its ends. “Although the United States government was sovereign only as to certain objects, it was impossible to define all the means which it should use, because it was impossible for the founders to anticipate all future exigencies. Hamilton noted that the “general welfare clause” and the “necessary and proper clause” gave elasticity to the constitution. Hamilton won the argument with Washington, who signed his Bank Bill into law.

WHILE WE ARE UNSURE how the President will go about her plan to give the budget a second look, we feel strongly that in order for Liberia to survive the ongoing global economic downturn, a lot of sacrifices will have to be made and it will require those at the top of the ladder to cut down on unnecessary expenditures like the extravagant allotment of gasoline and fuel, said to be in the millions and a host of other damning allotments that deny decent and hardworking folks at the bottom of the economic ladder a fair shot at the economic pie.

IT SADDENS US that many of those elected to public office and even those appointed by the President would betray public confidence by inserting allotments beneficial only to themselves but painfully to the detriment of the suffering masses.

IF LIBERIA MUST turn the corner and restore its economic sanity after a painful and protracted civil war, we must begin to make sacrifices that will show international stakeholders that we mean well for the people we serve.

BUT IT MUST begin and end with those in authority; they must set the pace in motion for the rest of the country to follow. If new information suggest that some sinister allotments are hidden in the budget that could give a political advantage to some of those in position of power, we support any initiative that aims to put things in check and save Liberia much needed coppers that could go toward the construction of a school, a hospital or road project in some hard-to-reach areas.

BUT WE MUST not stop there. Those found culpable should be brought to book, interrogated, investigated and made to pay for attempting to manipulate the budget for the own selfish greed.

Monrovia –  In a rather rare but bold move, President Ellen Johnson-Sirleaf is poised to recall the 2016/2017 draft budget this week, just a week after convening a Cabinet meeting during which she threatened punitive action against any member of the executive involved in budget manipulation, FrontPageAfrica has learned.

Report by Rodney D. Sieh, rodney.sieh@frontpageafricaonline.com

Massive Shakeup Looms At Finance Ministry

Multiple sources have confirmed to FPA that the President is on the verge of recalling the budget she submitted to the House of Representatives on June 2, 2016.

According to one source close to the Executive Mansion, the President has been contemplating this move ever since cabinet issued a warning to its members about budget manipulations.

The source explained: “As the administration comes to an end the President is keen for the budget to reflect more of her priorities, including energy, roads and other critical infrastructure.”

“With a not too rosy economic outlook the President wants to tighten the budget and do more from the executive end to prevent unrealistic revenue forecast leading to inflated expenditures which may not be in the national interest.”

FrontPageAfrica has also learned that the President has asked Mr. James Kollie, Deputy Minister of Finance for Administration to resign.

The President, it can be recalled, on July 31, 2016, accepted the resignation of the Comptroller and Accountant General of the Republic of Liberia, Mr. Sekou A. Sanoe and appointed Mr. Hanson Kaizulu as Acting Comptroller and Accountant General with immediate effect. 

During last week’s Cabinet meeting, ministers expressed concern about budget manipulation and warned members that anyone found in breach would be punished.

The Cabinet mandated that punitive action awaits any line Minister who engages in budget manipulation process while being subject to the vetoing of the specific unauthorized appropriation, which runs contrary to the draft budget originally submitted to the National Legislature.

It is unclear whether the resignation of Mr. Kollie and Mr. Sanoe are related to that action.

The Draft National Budget for 2016/2017 of US$555.9 million, comprises US$495.5 million for Core Domestic Revenue; US$30.2 million as Grant; and US$30.1 million as Contingent Domestic Revenue.

Prior to the President submitting the budget, the Cabinet, approved the Draft National Budget of over US$600-million, representing Domestic Revenue of more than US$400-million, Grants/Budget Support of more than US$66-million, Borrowing of over US$58-million, and a surplus from last year’s budget of over US$13-million.

The Cabinet also agreed on key areas of expenditure to include debt repayment amounting to US$32.5-million, payment of salaries across the Government US$252.1-million and, Social Development Fund and other pass through US$23.2-million.

Key areas of expenditure will also include, Health Sector Strengthening US$73.0-million, Education Sector Support US$79.4-million and, Security and Rule of Law US$90.1-million, including US$15-million for UNMIL Transition, as First Claims on the resource envelop.

Others include the Government of Liberia’s (GoL) contribution (Counterpart Funding) to ongoing donor financed public investment projects through loans and grants amounts to US$24.5-million, and GoL’s Grants and Transfers to various institutions and entities that contribute to Liberia’s socio-economic reconstruction US$85.7-million.

In support of major Public Sector Investments, intended to advance Liberia’s post-Ebola recovery, growth, and development, the Cabinet agreed to fund road construction and maintenance at the cost of US$44.3-million, including US$17.3-million as GoL’s contribution to donor funded projects.

The Cabinet also agreed to fund renovation of public buildings at the cost of US$9-million, expansion of electricity at US$2.4-million, district development projects throughout the country (through the National Legislature) at  US$10.9-million, and water & sanitation US$2.3-million.

Beach & waterways cleaning at US$1-million, human capacity-building US$2-million, private sector development US$1.5-million, National Low Cost Housing project (US$1.5 million, and LWSC Water Project US$1.0-million were other key areas the Cabinet also agreed on at its weekend’s meeting.

Other key areas considered in the draft budget by the Cabinet include renovation works at BWI US$1-million, renovation works at Tubman University (US$1-million, and a host of other key interventions critical for the delivery of social services and economic transformation.

In recent weeks, Sirleaf and her Cabinet have been keen on reviewing the status updates on key benchmarks in the areas of roads, ports, water & sanitation, education as well as Task Force performance covering agriculture and agro-processing and manufacturing and business support.

The Cabinet last week, took note of the status updates on roads, ports, water & sanitation, education and related Task Force performance projects and mandated proper and effective coordination initiatives that will translate into realizable outcomes for the benefit of the nation and its people.

The Cabinet also received update on the Draft National Fisheries and Aquaculture Act, which seeks to provide sustainable development of fisheries resources and the proper management and control of fisheries for present and future generations.

The fisheries sector will effectively contribute to economic growth and development -12% to agriculture GDP; 3% to National GDP; 65% to protein intake, and has the potential for employment as well as investment and revenue.

The looming budget recall comes amid a serious push by President Sirleaf to beef up deliverables accomplished on the watch of the administration

In recent weeks, both the Executive and Legislative branches of government have been at loggerheads prompting some to suggest that the looming recall could be tie to reports of friction between embattled speaker Alex Tyler and President Sirleaf.

Pressed as to whether or not this recall has anything to do with the fight over the Speaker, one member of the Executive said: “No! While the ongoing drama at the House is of keen interest to us, we follow it through the news like the regular public and have no involvement and do not intend to get involve.”

The President retreated to her farm in Bomi County late Thursday night which indicates a major decision is about to be made.

It is likely that members of her team close to this budget recall may be trekking to Bomi as well. When reached for confirmation Information Minister Eugene Nagbe said” “The President is having a cookout with villagers who helped with her farm work this weekend and is preparing for that.”

The Minister did not confirm nor deny the budget recall.