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Is Sierra Leone’s 2010 budget fiscally prudent?

27 December 2009 at 02:12 | 488 views

By Mohamed C. Bah, Ex-President, Sierra Leone Community, Atlanta, USA.

The government Budget statements and Financial policies for the financial year 2010 delivered by the Minister of Finance and Economic Development, Dr. Samura Kamara on December 4, 2009 in the chamber of parliament offers some fresh hope of our nation’s troubling economy. I was particularly encouraged by the budget theme: “confronting the future with the objective to boost investment structure, support the productive sector for economic development and improve health care delivery services in the country.” Dr. Kamara mentioned about the challenges our nation face over the years about the low income per capital, low life expectancy rate, illiteracy and poverty, youth unemployment, global recession and the slow pace of foreign investments. At least, every Sierra Leonean regardless of their political affiliations seem to be on the same accord when it comes to the serious national problems confronting Sierra Leone. What we need is a common solution with the spirited determination to improving the state of our economy while giving Sierra Leoneans a more dignified and decent living.

FIXING THE CRACKS

Earlier in May, 2009, I wrote about the government budgetary statements of 2009 on the Patriotic Vanguard (PV publication May 6, 2009) titled: “ Holding our Government Accountable ” in which i outlined the poor financial infrastructures, under-performing ministries, inadequate budgetary allocations, non-transparency and the institutionalize corruption of departmental ministries. I directly offered some remedial solutions to addressing the cesspool of corruption and making these incompetent ministries more accountable and efficient. However, broader reforms seems to be far reaching, budgetary planning are not properly implemented and public procurement systems lacks transparency and supervision. There are still deficiency in the public accounting ad expenditure tracking which lacks verifiable mechanism through internal and external audit system. The Auditor General’s office needs broader powers or be more proactive to conduct departmental and ministerial audits with more ethical standards and free from undue influence by political patrons.

DEFEAT CORRUPTION

Noteworthy, the government received high marks, earlier this year, by the Executive Board of IMF for Sierra Leone’s overall performance in implementing some prudent fiscal and monetary policies towards the Poverty Reduction and Growth Facility (PRGF).Obviously, Sierra Leone has the potential to re- emerge from the wrath of economic strangulation and become a new regional giant along sub-Sahara Africa. The most prudent thing to do is to “destroy and defeat” the endemic problem of corruption through salary increase as it is done on the “The Appropriation Act of 2010” and the removal of corrupt government officers from the realm of power. If we improve working conditions and incentivize salary structures of the civil servants, adopt a dual crime and punishment approach to corruption, government revenues will subsequently quadruple from LE 1.5 trillion (today) to LE 4.5 trillion next year. The sacred cow doctrine, however, must be executed broadly and indiscriminately without cherry picking on low level government officers alone. Corruption must seize becoming the fastest growing religion in Sierra Leone. It must not be glorified as the most attractive asset to public service. After all, no nation have prospered from citizens who plundered its wealth against the whims and caprices of the common people. Poverty and the lack of opportunities exist because we inherently fail to create the industries and technologies on which modern development thrives. We define our records of services to our people more about what we receive than what we give to them. As Albert Einstein correctly puts it: “Only a life lived for others is worth living.”

DOMESTIC REVENUE

Comprehensively, Sierra Leone’s national revenues including grants for the financial year 2010 is projected at LE 1.4 trillion and expenditures including net lending is projected at LE 1.5 trillion. Noticeably, the 4% growth of the economy is resounding but revenues continue to suffer a sluggish downward trend. Sierra Leone is spending more money than it is receiving annually. The cost of financing domestic borrowing and interest on international loans remains an impediment to government prudent fiscal discipline. We must have a solvent economy independently capable of funding domestic ministries and developmental projects without foreign loans from the World Bank. One way we can control cost or expenditures are trimming expenses and fiscally increasing national savings. Government must eliminate redundant ministries that basically serve duplicated functions, cut back on the large scale entourage visit of government dignitaries to international conferences or missions, streamline the wasteful spending on MDA’S procurement and expenditures, plug the hole on institutionalized corruption, re-negotiate better mining contracts with premium percentages on royalties and licenses. In addition,the private sector along side the support of government must create jobs and encourage foreign investments. Also, the abolition of custom/excise taxes will economically stimulate the economy, flood the market with enough goods and services and bring down inflationary prices.

BUDGET ALLOCATION

Indeed, the allocation of LE 82.2 billion to key ministries including the Ministry of Energy and water Resources was strategically significant, but the National Power Authority (NPA) does not seem to be emerging from it under performing status. Guma Valley continue to maintain a satisfactory performance on it revenue growth. It is no surprise that an additional LE 33.2 Billion was allocated to water services. However, revenues must reflect on providing quality and accessible drinking water to the general population. Also, the ministry of Marine Resources ans Fisheries, yet a revenue potential institution have been incompetent with consistent leadership challenges. The LE 59 billion allocation must be contingent upon restructuring of the ministry, identifying long term growth and conducting periodic audit from the Auditor General’s office.

Furthermore, Agriculture and Food security reportedly received an increase allocation of LE 59.0 billion. Again, the new focus must be on self-sufficiency and the exportation of local goods rather than the importation of rice or perishable commodities. We must duplicate the technologies of India, Vietnam and China on the growing, packaging and distribution of rice or staple foods on our own national market. These so-called tractorization and donor funds from Libya or the EU

countries are potential magnets for corrupt politicians to mismanage and misappropriate. We must grow our own rice with a new national brand labeled as: “Made in Sierra Leone.” We need sustainable development to build a strong labor force and create a new growing middle class in Sierra Leone. It is time to say good bye to the donor-driven economy and become economically independent as a sovereign state.

While education and the Health Ministries received significant allocations of LE 91 billion and LE 97 billion respectively, a lot of innovative efforts should be spearheaded on building the infrastructures of these two viable entities. The logistical resources, proper trained personnels, better salaries, updated equipments and adequate funding with forward thinking leadership are vital components to the overall success of such important ministries. The culture of maintaining existing infrastructures and the attitude of upgrading systems, tools and techniques are core principles to the general progress of any public institutions. We cannot define progress by cosmetically painting buildings and buying few equipments for political necessities. Progress is a continuous process and exist with strong organizational structure, rules of operation and transparent evaluation methods.

Nonetheless, The free health care for pregnant women and lactating mothers are impressive signs that government is concern about per-natal care and the high infant mortality rate in Sierra Leone. Health care is a national development priority and President Koroma must be commended for allowing the crack down on “illegal clinics” some months ago in Freetown Sierra Leone. However, the development of strong drug control policies with the emphasis on low cost drugs and expansion of its availability to rural communites must be a new litmus test for the present administration. Also, serious efforts should be directed on leadership and enforcement to implement the national health policy authored in the PHC manual (May 25, 2007). Furtherore, the 20% salary increase for civil servants, teachers, police force and the military are strategically a prudent approach to addressing the low morale problem and rampant corruption in our society.

NEW OPPORTUNITIES

However,the 2010 budget expenditure of LE 1.5 trillion is higher than the national revenue of LE 1.4 trillion. Sierra Leone cannot afford to run a deficit by any economic standard. Many Sierra Leoneans refuse to believe that our mining sector is unable to generate the bulk of our revenues like Botswana South Africa and Namibia..The LE 20.3 billion annual revenue (for 2009) is a disappointing figure since mining revenues should provide half of our national budget.

Thus, we need a comprehensive review of our mining policies, a reorganization of the Ministry and an evaluation on how to generate significant mining dollars for Sierra Leone. Infact, the drop in diamond export to 52% this year is an alarming trend which needs counter proactive solutions. Smuggling without strict government control and the lack of strong mining policies, poor tracking systems of revenues and rampant corruption are some of the challenges our mining sector is undergoing. However, new opportunities must be pursue on the creation of a “sorting and aggregation” industry where we can polish and cut our own diamond for export.

On the other hand, diamond revenue make up 50% of Botswana’s budget. Diamonds and other minerals accounts for 35% of South Africa’s export while Ghana’s diamond export in 2008 was reported to be in the figures of $29.5 million. Namibia earn 40% of its export revenues through diamonds. Diamond revenue in Botswana allows every child up to the age of 13 to receive free education. Thus, Sierra Leone must optimize its natural minerals with prudent thinking and a new economic performance in its mining sector.

CONCLUSION

Indeed, Sierra Leoneans are grateful to those who brings out the greatness our nation aspires us to be. The patriotic leaders, whether it is our President or Ministers of our sovereign state must understand the power of listening and learning from others. If the intentions are sincere and the criticism construction, the good of our nation transcends our personal sentiments. My passion to offer my deepest loyalty to my nation is bound by my nationalistic instinct and what Sierra Leone have provided me – a rich culture of perseverance and optimism and the fundamental values of honesty and integrity. If someone is torched by the strength of justice or move by the courage of common truth, a new hope is born and a promising future is on the horizon for Sierra Leone. For we just cannot deceive ourselves always by expecting rain to fall in a place commonly known as a “desert.”

If we remind ourselves every day about the obligations and responsibilities of public service, we can surely transform our nation into a center of economic development, where a man or woman does not have to die because of medical inadequacies, where a young brilliant mind never blossoms because of educational disparity and where a little girl cannot see a dentist because of the lack of access to one. That is the importance of creating sound budgetary statements and policies that works for the ultimate good of our nation. The 2010 budget is the start of a long road to economic recovery in Sierra Leone. If we can find common grounds to work together, lets invoke the philosophical guidance of Abraham Lincoln who eloquently said: “the best way to predict the future is to create one.”

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