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Wednesday, April 24, 2024

Liberian President Boakai Runs ‘Big Government ‘ Amidst Shrinking Revenue

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By Festus Poquie

President Joseph Boakai has seemingly abandoned his long-standing ideology of a small efficient government, opting instead for a large government structure.

This policy option has led to increase in the number of offices across ministries and agencies, which critics and analysts see as attempt to appease loyalists and supporters.

In the short time since taking office, the President has appointed numerous board members and members of state-owned enterprises and other government agencies. Between January and March, more than 250 individuals have been appointed to just board related positions.

Experts and critics argue that this expansion of government is detrimental to efficient corporate governance. With an already overstretched state bureaucracy and a lack of technical know-how, the effectiveness of these boards is called into question.

“Board governance is a serious matter but in Liberia is a feel-good reward system,” former Auditor General John Morlu said.

“99% of the people have no business being on the board in which they are appointed. Put people on board where they can add value, not just board fees. Government is also getting bigger than CDC. CDC made government bigger than Sirleaf, too. Now Boakai is doubling down as well. They are giving up again on private sector led growth.”

Low Compensation

Despite increase in the number of senior level government employment, President Joseph Boakai and the Ministry of Finance and Development Planning are pursuing austerity policy proposing reduction in the country’s wage bill in contrast to previous promise to increase civil servants’ salaries

The annual salaries and other remuneration have been cut by 2.6%, equivalent to $8 million. This reduction brings the total wage bill from $305 million to $297 million. This shows the Unity party administration reverted to 2019/20 payroll.

The Civil Service agency has cut consultancy budget from $4 million to $2 million United States dollars.

For the 12-month period ending in December 2024, the administration plans to allocate $690.2 million.  This decrease in compensation spending dashes the hopes of public sector employees who were anticipating an increase in earnings following the infamous payroll harmonization exercise of the Weah administration.

Back in 2019, the International Monetary Fund highlighted the lack of transparency and credibility in the country’s wage bill. They emphasized the need for key policy reforms to create fiscal space.

Under the previous George Weah administration, a payroll harmonization policy was implemented to minimize salary disparity. This policy matched the salaries of employees with the same positions partially or fully.

As a result, the government wage bill was reduced from $322 million in the fiscal year 2018/2019 to $297 million for the fiscal year 2019/2020, according to the Ministry of Finance and Development Planning.

 

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