Taking Poor Pensioners’ Money to Finance Government Operations is Unthinkable, Dangerous and is Tantamount to “Cutting the Nose to Spite the Face”.

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The debate about the US$6,500 paid recently to members of the Legislature has exposed interesting activities (i.e., prior expenditure, secret budgetary arrangement, or inducement payment) between the Liberian Executive Branch and Legislative Branch, with Liberians asking again the obvious question. Why is the country not spending its limited resources on priority programs?

Many Liberian senators have since provided various answers and explained that President George Weah did not bribe them as alleged by Senior Senator Prince Johnson. Some have claimed that the Executive Branch and the Legislature included the payments within the 2020-2021 budgetary outlay, which both Lawmakers and President Weah signed into Law. Another Senator has asserted the amount was a liability while another has called it “claims”. We tend to agree with the latter.

But a review of the budget on page # xxvii, the Summary by Economic Classification under number 1.6 did not indicate that the amount paid to the upper Lawmakers and/or both lawmakers were included. Item 21 (compensation of employees) shows $322,672,328; $297,000,000; $297,000,000; and $297,000,000 $297,000,000 for fiscal periods 2018-2019, 2019-2020, 2020-2021 and 2021-2022 respectively.

Further, on page # xxxi, the Summary of Classification by Function under number 1.9 gave a combined amount for the executive Branch and the Legislative Branch. Item 0111 (Executive and Legislative Organization) shows $93,984,929; $78,062,720; 78,062,720; and 78,062,720 for fiscal periods 2018-2019, 2019-2020, 2020-2021and 2021-2022 respectively.

However, on page # 2, under the title called “spending Entity,” the Legislative Branch reported amounts as $30,410,392; $25,701,390; $25,701,390; and $25,701,390 for 2018-2019, 2019-2020; 2020-2021; and 2021-2022 . This means therefore, that the allotment to the Legislature was reduced by US$4,709,002 from fiscal years 2018-2019 and 2019-2020 respectively. Why? It is because 2019-2020 covers the month of July 2019 through June 30, 2020. The question here is whether the reduction deprived Legislators from getting their special Operational expenses?

In this regard, it is important to understand that the Liberian Senate has an allotment called “Operational Expenses. As indicated on Page# 6 of the budget, US$497,564 was allotted for fiscal year 2018-2019 while for fiscal year 2019-2020 US$256,501 was allotted and for fiscal year 2020-2021, US$336,868 was allotted while for fiscal year 2021-2022, $335,288 is allotted respectively.

Predictably, legislators will argue that the government appropriated the amount in question. For his part, Senator Dillon has told journalists that the money was allotted, checks were prepared and disbursed accordingly. However, the most important question is, did the government have the money to do so? Or better yet, from where did the government get the money since it has and continues to maintain that government is not collecting adequate revenue to cover its daily expenditure?

We must clarify, though, that a government can borrow cash to finance its operations. So, in principle, it is legal for government to borrow money to cover its daily expenditure, including the special allowance in question. But rather than borrow money from lending institutions, government has since and most regrettably turned to state owned enterprises/entities such as NASSCORP which manages poor people pension funds and which itself is cash strapped.

As reported by the Central Bank of Liberia, the Liberian government took L$560.7M from the Liberian people social security pension funds. As stated, “…the government issued a 1-year indexed treasury bills in the tune of L$560.7 million to the National Social Security Corporation (NASSCORP).” Demanding cash from cash trapped state-owned entities and classifying same as a sale of bonds is indeed very troubling.

For example, the 2019 Central Bank of Liberia Annual Report stated that, “from January 2019 to December 2019, a total of L$1.7 billion was raised through the issuance of government securities to institutional investors with a complementary redemption in the tune of L$837.0 million at a “weighted average yield” of 4.4 percent.

Analysis show that of the total amount, the government issued a 1-year indexed treasury bills in the tune of L$560.7 million to the National Social Security Corporation (NASSCORP) and L$300 million to a commercial bank on behalf of the Rubbers Planters Association of Liberia (RPAL), respectively. The remaining L$837 million was raised through the 91-day T-bill”. But why, for example is the government of Liberia financing RPAL which is neither a public corporation nor an agency of government?

The public ought to know that poor Liberian farmers are compelled to surrender portion of their earnings to the RPAL from which they derive no benefits or in which they hold no real stake. The public also ought to know that during the Sirleaf administration the RPAL was a virtual cash cow for government officials. Fights for control over its finances have been an enduring problem which may have led to the brutal killing of Keith Juba, appointed by former President Sirleaf to oversee its operations.

In view of this, the public ought to know just how the L$300 million treasury bill issued to the RPAL is going to be redeemed. Also how can the Central Bank of Liberia justify the siphoning of poor people pension savings from NASSCORP under the bogus pretext of a “sale of bonds” in order to finance government operations? What will then become of poor people pensions savings should government find itself unable to redeem those bonds in the near or short term?

This is a matter of grave public concern, a recipe for trouble, social unrest which could very well undermine the legitimacy of this government. Moreover, the National Legislature whose responsibility it is to provide oversight appears to have failed its fiduciary responsibility and surrendered same to the Central Bank of Liberia (CBL), which is regrettable and most unfortunate.

This kind of “dig hole, cover hole” mentality of our national policy makers is hurting the country. Taking poor pensioners’ money to finance government operations, i.e. the US$6.5k payout to legislators, is unthinkable and tantamount to “cutting the nose to spite the face”.

6 COMMENTS

  1. If the Executive is held hostage by the Reps we elected, and no laws can be passed to help us unless money is extorted from said Executive, who else is to blame but us for not holding our Reps accountable? If you truly want an answer, ask your Rep! Let us stop this nonsense ourselves.

  2. Apart from debt forgiveness, between 2007 and 2010, Liberia got donor aid and saw direct investments of about USD $18 billion. Notwithstanding, while poverty pulverized the vast majority of our people, few in government had their compensation packages rose to one of the highest on the continent. The late LP leader Brumskine and his running mate even got a loan of USD $1.5 million from NASSCORP to buy a rubber company. Let us stop the frenzied unaccountable behaviors, money oils the economy to uplift citizens; frankly, the only formula for public safety and stability.

  3. Betty Williams

    In my opinion, a democracy will not function well if the citizens in that democracy cannot read and write. I am not implying all citizens must have a college degree or a college level degree in order for a democracy to work; however, they must have a basic, appreciable level of literacy so they can be able to keep themselves well informed, think analytically, and make sound decisions in the way of choosing the right people to lead them.

    Unfortunately, this factor has become a serious impediment to the smooth functioning of the Liberian democracy and it is haunting the nation.

    Imagine this Ms. Williams: The Liberian president, George Weah, was participating in a major international conference a few days ago with other leading African Heads of State and in alluding to the seriousness of the COVID-19 pandemic he said, “…he was singing songs in studios to sanitize the people.” If this does not explain to our policy makers that something is wrong with our educational system, then I do not know what else must occur to let us know that Liberia’s educational system has failed her, and that her civilization pales in comparison to all her neighbors.

    If the vast majority was literate and understood their constitutional rights, then they would know the basis by which they can hold their congressmen’s and women’s feet to the fire. On the other hand, the opposite is the reality in Liberia. What’s your take on this Ms. Williams?

  4. Right to be Anonymous; arguendo, let us pretend that everything you have said here is true and correct, but ask you this conclusion of yours ..about the rest of Africa and most of Asia or peripheral nations in general:”the opposite is the reality in Liberia.”

    Is “the opposite” not the same in the rest of Africa and the global periphery nations as compared to center nations? IT IS THE SAME! AND YOU ALL KNOW IT! But you must stoop to party politics even when such disposition is uncalled for!

    You people should extend your focus to “THE BIG PICTURE”!

  5. Dear True Nationalist,

    First, let me confess that I am sometimes intrigued by your reasoning and by what you say. You are indeed a good and passionate person.

    But let me share a story with you about a caption I read on someone’s Facebook page that left me perplex for hours.
    It is about a picture from World War II where a soldier is found carrying a donkey on his back. The author reminded readers that it did not mean the soldier loved donkeys or had some sort of perversion. The soldier was simply doing so because the field through which they were passing was mined and if the donkey had been left free to wander as it pleased, it would have likely detonated a charge and killed everyone.
    The moral of the story is that during difficult times, the first ones you have to keep under control are the jackasses who don’t understand the danger and do as they please.

    It is true that most Asian and African countries have more or less the same social and economic impediments, but I think you will agree with me that some are making headways and can now be classified among emerging or developing countries.
    Those countries are making strides because they have somehow succeeded in keeping under control their jackasses who don’t understand the stake at hand.

    Look around you in every country in West Africa, there is a soldier carrying on his back or leading his jackasses to prosperity, mindful of the BIG PICTURE to which you alluded.
    But look at your country, can’t you see the opposite unraveling before your eyes?

    I hope and pray that the scales will one day fall off the eyes of all Liberians to objectively judge and vote the rightful people capable of keeping our jackasses under control to reposition Liberia in the comity of nations.

  6. I say thanks to Mr. Paterus Dolo. What a very powerful analogy!

    The counterargument of the typical CDC supporter against the acceptance of the criticism that Weah’s policies have failed to put the country on the proper trajectory is that Weah’s failures are justified because the same failures did occur during the past administration; apart from that, they are also occurring in other countries.

    And so this specious argument that formulates the justification for Weah’s dismal performance causes me to ponder. How did other successful African nations, not to mention the Western civilizations and their kindred nations, would have become the great powers they are today and achieved the heights they have achieved today if their leaders, like Weah, were communicating to their citizens that education could not develop their nations? I wonder then, what would have been their model of success?

    How would have their leaders forged their civilizations ahead if they were bent on stagnating progress and encouraging them to settle for the status quo (present state of affairs), while at the same time shifting the nation’s woes on the past, bankrupting their nations’ treasuries and mercilessly worsening the wretched, living conditions of their citizens. But instead of them settling for the status quo, they in fact encourage investment in education which in turn spurred growth and innovation in the fields of medicine, technology, agriculture, science, and so forth.

    Therefore, I, like Paterus, wish that one day Liberians will wake up to this reality and say enough is enough. We will never again cast our votes to put the interests of selfish individuals before the common good of our nation.

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