The Government of Liberia (GoL) is currently facing scrutiny due to inconsistencies in its reported salary compensation figures for 2024, as outlined in the proposed 2025 budget. The draft national budget for 2025 indicates that the estimated salary outturn for 2024 is reported at US$253,396,908, significantly lower than the initially approved figure of US$299,360,895. This discrepancy raises serious concerns about the government's transparency and competence. The US$46 million variance cannot simply be dismissed as a forecasting error, especially without clear public justification.
This analysis explores whether this situation indicates deliberate fraud or significant budgetary error and examines the government's fiscal credibility implications.
Key points of concern include contradictions in reported figures. In 2023, the previous administration allocated US$305 million for salary compensation. The current government passed a compensation budget of US$299 million for 2024, which suggested continuity with previous trends. However, the estimated outturn for 2024 at US$253 million reflects a US$46 million reduction compared to the approved budget.
Furthermore, the proposed 2025 budget suggests an increase to US$315 million, implying a US$62 million difference between the 2024 outturn and 2025 projections. If the government claims a US$16 million increase for 2025, then logically, that would place the total at S$269 million, not US$315 million.
The plausibility of claiming US$46 million in "savings" is also questionable. Previous harmonization processes resulted in salary cuts totaling US$32 million, achieved after significant resistance and public backlash. Achieving an additional US$46 million cut within a fiscal year seems improbable without public outcry or significant layoffs. Moreover, the government has not provided a detailed explanation for this reduction, which fuels speculation about potential mismanagement or manipulation.
The implications for the 2025 budget projections are profound. If the government concludes 2024 with a figure of US$253 million and increases compensation by US$16 million, then the total salary budget for 2025 should logically be US$269 million. Reporting US$315 million instead creates an unexplained variance of US$46 million. If actual outturns approach US$313-317 million, as suggested by historical trends, then even more discrepancies arise in accounting for additional funds. Additionally, Finance Minister Augustine Nfaguan reported a few hours ago on OK FM that the annual salary outturn should be approximately USD 309 million. This figure also contradicts the budget, as adding USD 16 million to USD 309 million results in around USD 325 million, which further complicates the situation.
One argument to justify the USD $ 253 million could also be that the estimate covers a period of 10 months. However, it is reasonable enough to only compare annual figures to annual figures in the budget rather than comparing them to a 10-month estimate. Even if the figure is USD 253 million accounts for the 10 months, "YTD" should be indicated. But this is still wrong since they referred to the outturn for the year and held all other numbers constant. Potential explanations for these discrepancies include fraudulent reporting, where the government might underreport expenditures to create an illusion of cost savings aligning with fiscal consolidation goals.
While clerical or forecasting errors are possible, discrepancies of this magnitude—tens of millions—are difficult to attribute solely to oversight. Systemic payroll issues, such as inefficient payroll systems or a lack of robust monitoring, could also lead to inconsistent or inaccurate reporting.
To conclude, the US$46 million discrepancy in Liberia's 2024 salary compensation figures and the mismatch with the proposed 2025 budget are serious issues that require immediate clarification. This controversy exposes significant gaps in the government's fiscal accountability and raises questions about its capability to manage public resources effectively. To address these issues, it is recommended that the Ministry of Finance publish a detailed breakdown of 2024 salary expenditures and conduct an independent audit to verify reported outturns and projected budgets. Improved oversight through structural reforms in payroll management and budgetary reporting is necessary to prevent future discrepancies. Without clear answers, the government risks losing public trust and undermining its fiscal credibility; thus, this issue cannot be ignored and must be addressed openly and decisively.
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References:
[1] Liberian Government Tells IMF No Salary Increment For Civil Servants Until 2028
[2] Liberia: GAC Finds Major Discrepancies in Govt's Salary Harmonization Amounting to Millions
[3] Liberia: Govt Promises Civil Servants' Salary Increment in 2025
[4] Budget Book FY2024
Draft National Budget FY2025
[1] Liberian Government Tells IMF No Salary Increment For Civil Servants Until 2028
[2] Liberia: GAC Finds Major Discrepancies in Govt's Salary Harmonization Amounting to Millions
[3] Liberia: Govt Promises Civil Servants' Salary Increment in 2025
[4] Budget Book FY2024
Draft National Budget FY2025
[1] https://ppl-ai-file-upload.s3.amazonaws.com/web/direct-files/40974682/5c2cd9eb-9a92-4a5f-9e12-fdfc23c725a5/BudgetBookFY2024-compressed-2.pdf
[2] https://ppl-ai-file-upload.s3.amazonaws.com/web/direct-files/40974682/76f72884-b962-42f0-bad8-80d90655df8d/Budget_Book-2025.pdfSalary Compensation, outturn, honest mistake, Salary Compensation, outturn, honest mistake
[3] https://ppl-ai-file-upload.s3.amazonaws.com/web/direct-files/40974682/5c2cd9eb-9a92-4a5f-9e12-fdfc23c725a5/BudgetBookFY2024-compressed-2.pdfSalary Compensation, outturn, honest mistake
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