By Umaru Fofana
Forget about all the plans to build health care facilities, expand on the Medical Corps and set up a US-style centre for disease control as a way of responding to the awakening brought about by Ebola. These are all the brainchildren of people in Washington, Brussels, London, Geneva and elsewhere designed for the three countries hardest hit by the recent outbreak. So our elected leaders should claim no credit whatsoever for those. It is NOT their idea - despite they having been elected to think through solutions to our problems!
I am talking real homegrown initiatives to cushion the effect of the Ebola outbreak on especially poor people who are in the majority. Enters President Ellen Johnson-Sirleaf. Her post-Ebola approach for Liberia - not least the most recent one - is unveiled. I call it a frugal fiscal philosophy that aims to cut down on government spending. That can only be dreamed of in Sierra Leone.
The effect of the epidemic on all spheres of life in the affected countries is easily discernible - most prominent being the human toll and the economic malaise. So any attempt to mitigate the impact on the poor hapless people is worth celebrating, however belatedly that cometh. There can be no better way of fixing the economy than thinking prudent fiscal policies and saving more money.
I have never seen taxes being thrust upon a people emerging from a WAR - as even President Ernest Bai Koroma himself referred to the fight against Ebola - as is currently happening in Sierra Leone. Income tax has been increased by five percent even if the threshold has been lifted. This, at a time when the leone is taking a huge battering, making people’s salaries worth far less than they did this time last year. So what point in trumpeting that salary increase which has all now been subsumed into the tax rise and collapse of the leone. Restaurant or entertainment tax has also shot up, vehicle licences have gone up the roof. As far as I am concerned all this is to fund the extravagant lifestyle of members of a bloated government that is even being further expanded.
This is simple economics: Government’s ability to save more money is to embark on less spending. At no time is that needed more than now. Cut your coat according to your size. A friend who works in government service, gave me a ride sometime this week from a funeral. He has a very small and user-friendly - yet comfortable - car he uses. I wondered why especially at a time like this our government was not thinking of reducing expenditure. Ministers are using their fuel-guzzling official jeeps for all things - official and private - and at all times - including in the middle of the night. And the fuel and the wear and tear are all on the taxpayer. They can simply order these less expensive and cheap-to-run cars.
Liberia’s president Ellen Johnson-Sirleaf in January struck a sonorous note when she announced that her government had revised its recurrent appropriation for fiscal year 2015/16 - or budget - to reduce spending to save money to cope with the effect of the global economic effect and the harsh economic reality her country was facing in the wake of the Ebola outbreak. This is the president with who I flew on an Air Cote D’Ivoire plane as she attended the African Development Bank meeting in Abidjan last year. She did not hire a private jet that would have cost Liberian taxpayers a whooping $ 200,000!
Sirleaf may have a lot of things she is not getting right in her country but this one - goodness me! - is flawless, desirable and laudable. Excepting the minority who benefit from the excess spending, however adversely it impacts the masses. All sectors and departments and organs of government are to be affected. To the extent the country’s Senate ordered the jailing of the finance minister for 48 hours for suggesting that $ 1.3 million be slashed of their budget. Those Senators should all bow their heads in shame for that action or attempted action of locking up the minister for trying to save money for the masses!
Before this step, there had also been an agreement - call it an understanding - between the government of Liberia, the commercial banks and other businesses to mitigate the effect of loans on them after what commerce had gone through during the Ebola onslaught. That was even before the end of the outbreak was declared in her country. Failing to plan is surely planning to fail. She didn't want that.
In my beloved country some banks threatened the takeover of the collateral of some of the businesses which could not afford to pay back their loans. In one or two instances a bank sued businesses after the latter asked that the loan be restructured citing the Ebola effect. The bank, in which the state owns shares, would have none of it. Now they are lying waste as they wait for buyers.
Everybody knew the impact Ebola had on the hospitality industry - unless of course if you are Radisson Blu Mammy Yoko or the beachside resort at Tokeh which became the abode of many of the foreign health care workers who responded to the outbreak. Without a government policy of a reprieve never mind a tax concession, those middle level hotels and other businesses were left at the mercy of banks and reality.
Ironically, that was when the revenue authority also started closing down businesses for defaulting on the payment of their withholding tax on rent. The businesses that were to pay these property owners were in dire straits and many could not pay largely owing to the effect of the deadly virus. Instead every public revenue generating department is introducing or increasing tax. Increase or introduce all sorts of taxes on businesses it is not the business of the businesses you are taxing. It is the business of the consumers the vast majority of whom are either poor, hapless, jobless or all combined.
President Ernest Bai Koroma’s penchant for creating paid positions amazes me. How, for example, do you have a whole Youth Commission, a Youth Adviser based in State House, and a Youth Ministry. This is not only wasteful it is duplicitous - unnecessary! And there are a few more around. In fact a former British friend of mine who worked at State House told me not long ago that the office of the president could work far more efficiently with far less people than currently employed there. Duplicitous and wasteful indeed! Cutting down expenditure and being more honest in fighting corruption can earn the government a lot more money than all this obsessive overtaxation. And less painful too for the people. Ironically more unnecessary positions are being created by the state, and more parastatals too which are grossly useless however desirable their formations.
Government talks about no fee charged in public schools. Are they kidding me! Do they live in this country?! Nothing could be further from the truth! I have many kids I am helping educate - some are in public schools - and the fees the schools charge are neck-breaking for their poor parents. To get two Ebola orphans back into school - one to junior secondary school and another into SS2 made me wonder how their parents could have coped. Three others whose parents are still alive but just cant afford their school expenses would each have been required to cough up Le 134,000 on fees alone.
It requires no rocket science to know that the Liberia Model of cutting down on expenditure is what the Government of Sierra Leone needs to deal with the current economic malaise which they are papering over, so it doesn't burst.
(C) Politico 11/02/16
