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Liberia Fiscal Authorities Look to Cut Wage Bill Amid growing Deficits

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By: Festus Poquie

Finance Ministry officials are reviewing the country’s bloated  wage bill after the office of the President alarmed over 700 persons were feeding on its budget, taking salary expense at the Executive Mansion alone to nearly $3 million United States dollars yearly.

The process could potentially lead to a shrinking workforce in a payment system beset by decades of fraud, waste and abuse amidst growing budget deficit and public debt portfolio.

All governmental agencies are directed to submit their current or dummy payrolls by the 10th of every month for thorough scrutiny and necessary adjustments, a statement from the Ministry of Finance and Development Planning said late Wednesday.

“This proactive measure is part of the government’s commitment to improve fiscal management and ensure the punctual disbursement of salaries to all government employees.

“The move reflects the dedication of the government to uphold transparency and accountability within its financial operations. Agencies are instructed to comply with the deadline set by the MFDP to facilitate a smooth process.

“The MFDP assures all agencies that this step is crucial in enhancing the effectiveness of payroll management, thereby ensuring that hardworking public servants receive their salaries early and without discrepancies.”

Following the Unity Party’s 2023 presidential win, former Finance Minister Amara Konneh advised the Joseph Boakai administration into overhauling the country’s workforce in a way that will reduce government’s entities and cut jobs.

He calls it rationalization of the workforce.  This could see hundreds of thousands of public sectors employees’ layoff.

Konneh, elected to the Senate this year pursued the massive layoff policy when he served the Johnson-Sirleaf administration as Finance Minister between 2012– 2017.

In 2019, the International Monetary Fund said the country’s wage bill was lacking transparency and credibility. Key policy reform was needed to free up fiscal space, the Fund said.

The erstwhile George Weah administration implemented a payroll harmonization policy – a process through which salary of employees with the same position are fully or partially matched to minimize salary disparity.

Harmonization reduced the government wage bill from US$322 million at end of FY18/19 to US$297 million for FY19/20, according to the Ministry of Finance and Development Planning.

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