$650M: Security, Health, Education Top Liberia Fiscal Year 2012/13 Budget Written by Wade C. L. Williams, [email protected] Friday, 01 June 2012 00:17 Photo: Mohammed Siryon, MoF

Monrovia – A proposed fiscal budget for 2012/2013; totaling US$649.72 has been submitted to the national Legislature with Health, education and security taking priority. Copies of the budget’s breakdown provided by the Finance Ministry indicate US$69 Million was apportioned for education and security each while US68 million was allotted to the health sector. Finance Minister Amara Konneh presented the proposed budget he referred to as the first medium term budget, to the National Legislature through the office of Acting House Speaker Hans Barchue. The FY12/13 set at US$649.72 million, according to the Finance Ministry is a 26% increase over FY11/12 which was US$516.4 million. The government reportedly Borrowed a sum of US$80.3 million to implement some of the major projects included in the government’s Agenda for Transformation accounts for portion of the increase. Carrying some risks

The budget proposal notes: “Consistent with the Liberian Constitution, a request will be included in the National Budget Act for the Legislature to permit the Government to proceed with borrowing negotiations. The resource envelop also includes Contingent Revenue of US$24.3 million. In order that Government’s operation is not hindered, an annex will be included to reflect which expenditure lines are clearly matched to contingent revenue. Budget figures (e.g., revenues and expenditures) carry some risks for full implementation.” The Finance Ministry clarified that the passage of the FY12/13 budget does not mean that the National Legislature has authorized spending for three (3) years but consistent with the Constitution, only the appropriation for FY12/13 will be authorized within the context of the medium term. “Every year, the National Legislature will review the expenditure framework and enact a National Budget Law,” the ministry proposal states. Youth development, empowerment Other priorities outlined in the budget include reconciliation, youth development, youth empowerment and capacity building among others. Under youth development, the document states, US$20 million was allotted for use on various skills and livelihood programs as means of empowering young people across the country. The investment, according to the papers, will create gainful jobs creation for some 20,000 young people who constitute 60% of Liberia’s 3.5 million people. Youth empowerment will be achieved through the allocation of funds for agricultural produce buying from rural youth farmers as well as funds for community development in the fifteen counties. General capacity development—governments will investment US$10 million to begin addressing the capacity deficit involving the training of doctors, nurses, engineers, carpenters and electricians. US$5 million was earmarked for National Reconciliation, intended to address such national challenges including the memoralization purposes, as detailed in the proposal. In brief comments, Deputy Speaker Barchue hoped that provisions were made in the budget providing for all the fifteen counties as part of government’s decentralization policy. Notable difference from last budget The current FY12/13 Budget, according to the ministry, is different from budgets of the past. Not only because it is a budget based on a medium term expenditure framework (2012-2015), but the budget focuses on investing in key areas that have the potential for massive social and economic

returns that will transform the Liberian economy. Unlike previous budgets where spending was on a line item basis and funded mainly recurrent expenditure for ministries and agencies, the FY12/13 and the medium term focus on programs and projects. The regular costs of running ministries and agencies were cut drastically and savings moved into key programs. The current budget places less reliance on highly risky revenue sources. The Contingent Revenue envelop reduced from US$111 million to only US$24.3 million. A thorough risk profiling of one-off revenue sources was conducted to inform the revenue projection on which public expenditure have been proposed. The Budget shows that Core Domestic Revenue sources (Tax and Non-Tax revenue) are expanding. There is a 32% increase over FY11/12 (from US$342.8m to US$452.2m). The Budget aligns spending with aspiration of Liberia Rising 2030 and the Agenda for Transformation which can be encapsulated as follows: To become a “middle income” country by 2030characterized by sustainable and inclusive economic growth and development with improved quality of life for each citizen where inequality is drastically reduced . The Budget is strategically a Budget to Drive Liberia Rising 2030 and the Agenda for Transformation.