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Measuring Budget Performance in the Public Sector: The Way Forward for Liberia

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Another fiscal period in Liberia, which began 1 July 2011 ends very soon in three months, specifically 31 June 2012.Then the regular circle of rotation begins with another fiscal period July 2012 to June 2013.

On and on goes the merry-go-round of successive Liberian governments the chores of the Executive branch of Government, through the Ministry of Finance, submitting the draft Liberia’s National Budget to the National Legislature for approval. In most instances, what followed before budgetary approval was simply a formality of close door insubstantial “budget talks” bordering on personal negotiations and gains among the crafters, the approvers as well as heads of government entities. Sometimes, draft budgets were approved by the National Legislature the same day they were received from the Executive.

It was until 2007, former Auditor General Morlu first intervention of the Draft National Budget, which involved reviewing and producing a comprehensive report to the National Legislature and the President, that extinguished the once held long lived taboo of budget hiding and internment from the public. His intervention led to US$16.8 million in cash surplus that was eventually added to the 2007/2008 National Budget, thus producing the first ever budget debate involving the Liberian people, ensuring citizen participation in the budget process, as people living in villages and towns are also now interested in participation and discussion of the content of the National Budget.

However, what continues to pose a challenge and causes fundamental impairment to Liberia’s fiscal management growth, efficiency and development is the lack of an effective, workable, institutionalized, transparent and accountable policy put in place to measure, determine, monitor and establish performance of government ministries, agencies, autonomous commissions, authorities, bureaus, etc.

All that happened every fiscal year is that draft budgets of government institutions channeled through the collective and wholesome National Budget being always and all times approved by the Legislature without the legislature demanding how previously approved taxpayers’ money were expended in the preceding fiscal years before approving the new money and spending. Budget Performance Report before approval of another fiscal budget is a fairy tale.

The GAC strives to mitigate fiscal managerial risks and weak systems and controls by conducting audits of most of those public entities and sent audit reports to the National Legislature and the President, but interestingly, some of those audited entities captured in audit findings to account for taxpayers’ monies and /or that lacked established systems and controls are given dramatic double and sometimes triple increment in the next fiscal period without first ensuring whether those audit recommendations were substantially addressed.

One Year Performance Contract

The recent statement by President Sirleaf at the National Legislature that she will demand the heads of public entities to sign a one year performance contract, if this is truly actualized, is certainly the beginning of the process of the Government opting to systemically and institutionally cure the handicap of the insufficient Liberian Governments attention to public entities performance and results.

To further strengthen the one year performance contract, each public entity should carve a five years strategy plan. Strategic plans not only provide transparency to the process by which heads of public entities set their priorities, also provide a road map for how those plans, overall objectives and goals of entities can reach results.

The strategic plans of the various public entities should provide a comprehensive mission statement covering the majors functions and operations of the agency concisely set the goals and objectives of the those entities and provide comprehensive description of how those goals and objectives are to be achieved, including a description of the operational processes, skills and technology, and the human, capital, information, and other resources required to meet those goals.

Before the President decides to renew or not to renew the one year performance contract of public officials, she would have established from the five years strategy plans whether the first year goals and objectives in the five years strategy plans were achieved or not. On and on goes with the succeeding years of the strategic plans and the subsequent renewal or revocation of the one year performance contract depending on the deliverable, outcomes and results of each year in the Strategic Plan.

The United States of America, a Liberian model of best standard and practice has a 1983 Performance Result Act that requires government agencies to write a five years strategy plan. The Act does not only limit the burden of tracking and measuring public performance result at the feet of the Executive. The Legislature has a cardinal part to play. The Act requires the head of each agency of government to submit to the Director of the Office of Management and Budget (an equivalent of the defunct Director of Budget Bureau of Liberia the) and to the Congress a strategic plan for program activities. The US Congress checklist those strategic plans matching performance or non-performance before approval of another budget for a new fiscal period. Even at the formative stage of the strategy plans, Congress has a major input required in the 1983 Performance Act that “ When developing a strategic plan, the agency shall consult with the Congress, and shall solicit and consider the views and suggestions of those entities potentially affected by or interested in such a plan.”

The US Act required that “The strategic plan shall cover a period of not less than five years forward from the fiscal year in which it is submitted, and shall be updated and revised at least every three years.”

The Liberian Legislature and the Executive should take a cue in considering also enacting similar Performance Act as vehicle of strengthening performance and resulting in the public sector. At this new stage of the newly introduced one year performance contract, GAC and the Legislature can work together for the audit of the five years strategy plan at the end of every year before a new one year performance contract is renewed. A replay of President Sirleaf when she spoke during the commissioning ceremony for cabinet members who passed the confirmation hearing at the Legislature “there is also the need for urgent conclusion of the one year performance contract to which we have agreed.” Everyone is waiting for this worthwhile plan to come to fruition and fear this may be another political publicity stunt, with no action.

Strengthening Liberia’s Existing Laws from the Dustbin to Realization

The late G. Henry Andrews once said that Liberia is good at having the best laws on the book but that most times there is a wide gulf between what is on the book and what being done or will be done.

There are existing laws on the book that clearly show the strength, power and authority of the Legislature to be presented with Budget Performance report before approval of the new budgets. There are laws also that require the President to report to the Legislature how public money is spent the previous fiscal year before the legislature can approve another new budget for the next fiscal year.

Article 34 (d) requires the Legislature … “to make appropriations for the fiscal governance of the Republic…” Article 34(d) (ii) mandates “No monies shall be drawn from the treasure except in consequence of appropriations made by legislative enactment and upon warrant of the President; and no coin shall be minted or national currency issued except by the expressed authority of the Legislature. An annual statement and account of the expenditure of all public monies shall be submitted by the office of the President to the Legislature and published once a year.”

Article 58 also further “The President shall, on the fourth working Monday in January of each year, present the administration’s legislative program for the ensuing session, and shall once a year report to the Legislature on the state of the Republic. In presenting the economic condition of the Republic the report shall cover expenditure as well as income.”

The Public Finance Management Law of 2009,Part II, Section 5(1) empowers the President: “The President has overall responsibility for all policy matters related to the National Budget and public financial management system of the Republic of Liberia, and has the authority to take the decisions and actions necessary to carry out such responsibilities.

Despite all of these laws on the book, the challenge of transcending beyond shelving these laws to practicable reality remain unattainable. Much need to be done to move beyond window dressing and publicity stunt and “walk the talks” for the achievement of genuine fiscal reform.

Lee H.Williams,

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