Liberia: New austerity budget cuts expenses

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Liberia has a new $672 million austerity budget that cut official travel expenses to channel more funds to infrastructure.

The controversial budget also freezes salaries for civil servants.

President Ellen Johnson Sirleaf signed the budget late Wednesday, after it was passed by the legislature in August. Liberia's budget period runs from July to June, but this year's budget went through considerable legislative wrangling, as lawmakers disagreed on several provisions and asked for adjustments.

Finance Minister Amara Konneh told The Associated Press that the cuts in the budget show the president's austerity determination to allocate money to more pressing areas. "Economic growth and development begins with fiscal discipline," Konneh said."We are launching an open budget initiative that will aggressively track public expenditure."

Konneh said the budget represented a big increase over last year's budget of $515 million.

"Our economy is growing; it is recovering very strongly; we are expected to grow by 8.8 percent this year," Konneh said, citing IMF projections for 2012, up from growth of 6.4 percent in 2011.

Konneh said Liberia needs a tight budget "because we have a lot of post-war challenges; the government payroll continues to increase; our operation expenses continue to increase."

The new budget cut $110 million from last year's budget for official travel expenses such as cars, fuel and lodging, said Konneh. All government offices, including the president's, were affected by the cuts.

Konneh defended the action, saying: "You cannot separate economic growth from fiscal discipline."

The budget has $106 million to improve power, roads, airports and other infrastructure.

"We need to transform and move the country forward," he said. "I am aware that some in government are not happy about the change, but I am glad that the cabinet and the legislature have embraced it."

The budget does not include salary raises for civil servants. It is suspected there are many false entries on the payroll, said Information Minister Lewis Brown. Once "ghost workers" are removed from the payroll, the savings will be used to give raises to working nurses, police and teachers, said Brown.

The budget of Liberia during the embattled regime of Charles Taylor, from 1997 until 2003, was around $80 million dollars when the country was under international sanctions.