“Stop Weah from Further Violating 2009 PFM LAW” -LPP Chair Zaza Calls on Lawmakers

The Chairman of the Liberian People’s Party (LPP), J. Yanqui Zaza  has re-echoed his call on the Liberian lawmakers to prevent President George Manneh Weah from further violating the 2009 Public Finance Management (PFM) Law of Liberia, citing what he called the illegal and controversial use of the USD25 Million from the Road Fund in 2019 for unexplained purposes, and crediting the General Auditing Commission (GAC) which recently revealed that the Weah Administration used USD25 Million for unexplained purposes in blatant violation of Section 2.2 of the Act establishing the National Road Fund for two fiscal periods, 7/1/2018 to 6/30/2020.

     In a press release from the party under the signature of Chairman Zaza, the LPP said in August of 2021, it issued a Press Release published in local newspapers, calling on President George Weah to explain why the government reduced public spending by 63%, from USD115 Million in 2019/20 to USD42 Million in 2021, 2022, and 2023; and subsequently increased payments by 170% to the State-owned bank, the Central Bank of Liberia (CBL) in the four fiscal periods.

    The release said LPP added that it accepted the theory and practice that governments can cut allocations for priority programs such as allocations for “Goods and Services” and increase payments to creditors. “Yet, the 63% (USD115Million minus USD 73 Million) cuts in appropriations for “Goods and Services” in 2021, 2022, and 2023 have affected and will continue to affect both government operations and the economy in general, LPP predicted then and continues to project the same scenario today”, the party said.

    The party said the President Weah Administration, at Legislative Hearing concerning the transfer of funds from appropriations for “Goods and Services” to the State-owned bank (CBL), did not provide any reasons until when it appeared on Radio Talk Show to justify the illegal use of the USD25 Million Road Fund.

    “And the government’s assertion was that the government was cash-strapped in 2019; therefore, it used the “legally restricted” Road Funds. On Sunday evening, 22 May 2022, on Spoon FM 107.5 Talk Show, the Minister of Finance and Development Planning (MFDP), Mr. Samuel D. Tweah, stated that the government was broke, and so the government used a portion of the Road Funds to finance public expenditure. The FrontpageAfrica Newspaper quoting Mr. Tweah, reported that, “Tweah noted that it is no secret that 2019 was the toughest year of the Administration of President George Weah…salaries were current in 2018 until the time in 2019…salary arrears were piling up,” and we began “…to look for ways to solve the crisis.” , the party said.    

    Providing figures to negate the government’s claims that it was cash strapped in 2019, the party said the budgetary transactions in 2019 do not support the assertions that the government was broke, asserting that the government received USD 65 Million from foreign creditors and USD 53 Million from local commercial banks in 2019. (See page 53 of the 2019 Central Bank of Liberia (CBL) Annual Report)., that the CBL printed LD4.0Billion additional bank notes, according to page 2 of the 2019 Annual Report of CBL and that the government reported that its revenue surplus increased from USD 22 Million in 2018 to USD42 Million in 2019. (See page 50 of the 2019 CBL Annual Report).

     Providing further information to back up its position, the party said Government’s LD16.5 Billion bank notes (i.e., additional cash owned by the government) were infused into the Liberian Economy, according to U.S. Embassy Press Release published on 28 February 2019, that the administration paid USD35 Million to the Central Bank of Liberia (i.e., state-owned bank) in 2019/2020, evident that the Administration was not cash-strapped as claimed by Minister Tweah (See Page # XVII of the 2019/2020 National Budget) and that the Donors gave about USD584 Million in 2018/2019 to Liberia, which nongovernmental agencies and some governmental agencies spent on government programs. (See page 9 of the Citizens Guide Budget of 2018/2019 prepared by the MFDP).

    “The lesson from these different budgetary records indicates that President Weah Administration is not following Liberia’s 2009 PFM Law. For instance, the President Weah Administration borrowed USD53 Million from commercial banks; however, its 2019/2020 budget did not project any borrowing from domestic sources. (See page XI of the 2019/20 National Budget). Moreover, the Administration is regularly defaulting on redeeming Treasury bonds and Treasury Bills, strangulating commercial banks, in violation of the six month pay-back requirement, according to Section 46(2) of the 1999 CBL Act amended on 20 October 2020”.

    “The Liberian People’s Party was not the only entity that pointed out that President Weah Administration blatantly circumvented the 2009 PFM Law. In June of 2021, under the Topic “2021 Fiscal Transparency Report: Liberia, U.S. Treasury Department stated that “…the government did not make its budget documents…publicly available in a reasonable period of time… significant deviations between projected and actual revenues during the review period undercut the reliability of budget information..  

     “Why transfer USD25 Million from the Road Fund to pay part of the USD37 Million debts owed to the state-owned CBL? Why borrow USD53 Million from commercial banks to pay USD37 Million debts owed to the state-owned bank, CBL? Why does the government claim to have realized surpluses of USD22 Million in 2018 and USD42 Million in 2019, but argues that it was broke in 2019? In 2020, officials of the Weah Administration were giving different statements about Liberia’s cash position. For instance, while officials of the Finance Ministry argued that the country was broke, other officials at the Liberia Revenue Authority stated Liberia was generating more revenue than projected”, the party further said.

     While calling on the Lawmakers to revisit the 2022 budget and review significant appropriations, LPP concluded the statement by submitting some of the recommendations outlined by the United States officials from the Treasury Department as was reported in June 2021 among which are that the lawmakers should meticulously review the National Budgets and demand answers from the Executive Branch, publish financial statements of state-owned enterprises, including debt and contingent liabilities, publish off-budget accounts (i.e., money donated by donors and are managed by nongovernmental agencies) and ensure that they are subject to adequate audit and oversight and produce and publish any supplemental budget when actual revenues and expenditures do not correspond to those in the lawful budget.

Comments are closed.