The Pro-poor Government’s Recast Budget: A Symbol of Depriving the Poor and Enriching Elements of the Political Class
By Moses Uneh Yahmia
Contributing Writer
About a week or two ago, the Ministry of Finance and Development Planning of the Republic of Liberia submitted to the 54th National Legislature a recast version of the 2017/2018 Fiscal Budget. According to the agency of government that manages the fiscal affairs of the state, the recast of the budget was necessitated by realistically aligning expenditure with revenue. According to the Ministry’s Proposal for the Recast of 2017/2018 National Budget, “The National Legislature approved a budget of US$563.5m for FY2017/18 to facilitate Government’s operations and undertake needed public sector investments.
However, following the approval of FY2017/18 National Budget by the Legislature, macroeconomic shocks in the international market, resulting to fall in prices in the nation’s major exports, coupled with the stalemate of the 2017 general election and the lingering aftermath of the Ebola Crisis continues to hinder Government’s ability to generate the needed revenue to undertake its programs.”
The Proposal continues: “The attending consequences of all of these resulted in a US$ 83.7m shortfall in expected revenue. This situation has necessitated a revision of the original approved budget of US$563.5m to realistically align expenditure with revenue.” The original revenue and expenditure projections were both estimated to be US$563.5m which implied a balanced budget. However, the challenging macroeconomic environment, as indicated above, led to an adjusted revenue projection of US$479.9m while expenditure projection remained unchanged at US$563.5. This created a gap of US$83.7m.”
On the summary of the recast budget, the Ministry outlined the following: “The approved revenue envelope for FY2017/18 was US563.5m, representing a 6.1 percent reduction compared to the approved amount of US$600.2m for FY 2016/17. Of the approved 2017/18 resource envelope, tax revenue accounts for US$401.4m (71.2 percent); non‐tax revenue accounts for US$100.4m (17.8 percent); grants, US$54.9m (9.7 percent); on budget borrowing, US$5.0m (0.9 percent); and carry forward accounts for US$1.8m (0.3 percent). As at end January 2018, total revenue including grant amounted to US$231.6m (about 41.1 percent of the projected revenue). However, given the challenging macroeconomic condition and the poor performance of most revenue lines, a number of austerity measures were instituted on the expenditure side including but not limited to cutting back certain categories of goods and services. These measures were complemented by the identification of additional external financing. These measures combined will result in a balanced budget of US$ 536.2m.
After a thorough review of the summary of the US536.2 million recast budget as indicated in the proposal that was submitted to the National Legislature and subsequently approved by that august body of government, it has been realized that this pro-poor government has not broken away from the past where government expenditure was dominated by recurrent spending in compensation of employees, purchase of goods and services for government and massive cut in capital expenditure which seeks to directly benefit the people.
The pro-poor recast budget is dominated by capitalist austerity. That is, there has been a massive cut in the budget of education, health, security, infrastructure and the delivery of basic social services. While these lines in the budget which directly benefit the people if implemented fully were cut colossally, the wage bill of the government was increased; purchase of goods and services for government agencies and ministries is now greater than before.
For example, in the previously approved US$ 563.5 million budget, compensation of employees stood at US$ 297,799,916. The proposed and approved recast US$ 536.2 million budget puts compensation of employees at US$ 307,280,850. This means the wage bill of the government has been increased by US$ 9,480,934.00. Payroll paddling, as in the case of the National Port Authority (NPA), and increment in the already huge salary and benefits of top officials of government, considering the huge income disparity between top officials of government and ordinary civil servants in the public sector have been the rule rather than the exception. This is no surprise though. This is just the continuation of the crisis of the capitalist system which calls for vast income inequality between the rich and the poor.
Also, the US$563.5 million budget puts the education budget at US$82,805,233. The recast budget places the budget of education at US$ 79,248,115. This indicates that there is a US$3,557,118 cut in education, a social good which is supposed to be any third world country’s major priority. This is just the government’s approval of its prejudice against education. The President came to power on anti-education rhetoric; therefore, it is necessary to stagnant the country’s educational sector through low budgetary appropriation. This will lead the people to continue maintaining the wave of illusion in this national disgrace that was imposed on the republic by some Liberians including Ellen Johnson Sirleaf and her band of thieves. On the other hand, the capitalist system in third world countries calls for limiting the mass of the people’s access to education. In the thinking of the lumpen reactionary counter-revolutionary gangsters, this will enable the ruling class’ continued domination of political and economic powers.
And that any attempt to introduced genuine education for self-reliance for the consumption of the people, they will become conscious of their oppression and fight strenuously for their liberation. This is the thought of the backward elements of reaction. So, these backward reactionary elements in Liberia think that by depriving the people education, the people will continue to be subjugated. Little do they know that throughout history, intensive class struggle emerged in different epoch and that the suppression of one class over another creates a motor force that serves as a catalyst for a revolutionary eruption. So, no matter how illiterate the mass of the people is, the number of contradictions in society will lead to the mass of the people struggling for a qualitative transformation of their social existence. It happened in October 1917 when the predominantly illiterate peasants and workers joined the Bolshevik Party of Russia to crush the Tzar Dynasty.
Back to the Recast Budget, the originally approved budget puts the expenditure envelop of health at US$ 77,048,239.00. The pro-poor government that says it is committed to the improving the health condition of the people, in its recast budget, puts the financial projection for health at US$ 72,224,058.00. This means the health budget has been cut by US$ 4, 824,181.00. Also, the previous budget puts the budget line of Infrastructure and Basic Services at US$ 38,755,002.
While the Pro-poor government, through its recast budget, increased the government’s wage bill by over nine million, presumably through payroll paddling and increment in top officials’ salary and benefits, government’s investment in infrastructure and basic social services has been reduced by US$ 24,101,206.00, as its recast budget puts the budget line of Infrastructure and Social Services at US$ 14,653,796. Similarly, the budget of Commerce and Industry was US$ 7,653,077.00. The Pro-poor’s recast budget puts the budget of commerce and industry at US$ 6,785,070.00. This indicates that the budget of commerce and industry was abridged by US$ 868,007.00. Under the caption: “Pro-poor projects” US$ 9.6million has been apportioned in the recast budget for special projects. In that budget line is US$ 500,000.00 for the office of the First Lady for “Humanitarian Purposes”.
This is how the CDC-led government intends to frustrate the people’s determination to move forward in culture, art, science, technology and etc. For us, we are not taken aback. Long before the coming to power of this political travesty, we distance ourselves from this humiliation imposed on the republic by Ellen Johnson Sirleaf and her criminal conglomerate in Amara Konneh, Madina Wesseh, Robert Sirleaf, James Kollie and etc. Ellen feels she has won. As the early contradiction unfolds, we can imagine her sitting in one of her luxurious villas laughing her guts out as she thinks she has once again outmaneuvered her political adversaries and bamboozled the Liberian people. That is, after plundering massively the resources of the state, she left with us a tabula rasa and career hustler who has assured her not only impunity but also protection for the criminal syndicate that emerged in the republic over two decades ago.
As Alan Woods of the International Marxist Tendency indicates in his “Ideas of Karl Marx: “At the time of the English Revolution, Oliver Cromwell fervently believed that he was fighting for the right of each individual to pray to God according to his conscience. But the further march of history proved that the Cromwellian Revolution was the decisive stage in the irresistible ascent of the English bourgeoisie to power.” So, Ellen Johnson Sirleaf thinks by imposing George Weah on the republic, she has triumph. She has legitimized her stolen wealth as inquiry into the colossal looting will be ignored by George Weah. But we can safely say, the emergence of a George Weah is necessary in the class struggle in Liberia. As we will further march into history, it will be proven that a George Weah’s Presidency was necessary to serve as a catalyst of a social revolution which will bring the mass of the people on the center stage of history and make them the subjects in the relations of production.
Until the people can stampede into history, we remain steadfast in the struggle.
About The Author: Moses Uneh Yahmia is a cadre of the left tendency in Liberia. He can be reached via moseswyalc@gmail.com