Freetown, SIERRA LEONE – In a bid to prevent the accumulation of arrears, Finance Minister Sheku A.F. Bangura has announced the adoption of a new measure: “Not in Budget, No Funding.” This is part of the ministry’s strategy outlined in their Revised Spending Arrears Clearance Strategy and Principles for 2023-2028. In addition to this, the ministry will enforce baseline budgeting and link procurement to the originally approved budget.
Domestic arrears have been a persistent issue affecting budget implementation in recent years, hindering the execution of government initiatives and public service delivery. Minister Bangura emphasized that addressing the pre-April 2018 stock of arrears, amounting to SLE 3.2 billion (approximately USD 320 million), while meeting the current fiscal needs of the government, has been a significant challenge. This challenge was exacerbated by the coinciding impact of the initial arrears clearance strategy and external shocks like the COVID-19 pandemic in 2020 and the Russian-Ukraine war in 2022.
The Minister acknowledged resistance to the initial strategy by Contractors, Suppliers, and Vendors (CSVs) who rejected the proposed deep discounts recommended in the strategy.
Under the revised strategy, the government will prioritize the payment of arrears to CSVs on a “first come, first served” basis, with preference given to sectors crucial to the nation’s well-being, including security, energy, education, agriculture, and health. This approach aims to ensure a continuous supply of equipment and food items to support the security sector in its mission to maintain peace, protect lives and property, enhance food security, and advance the Free Quality Education and health sectors. It will also contribute to expanding electricity supply across the country.
Furthermore, this new strategy aligns with the promotion of national peace and stability, as businesses receiving cash flows, particularly small and medium-sized enterprises (SMEs), will support commerce and improve overall welfare. This, in turn, aims to reduce tensions and ensure a stable and peaceful post-election consolidation, facilitating the realization of the government’s Big-Five agenda.
Minister Bangura also noted that the clearance of arrears will consider the government’s Big-Five priorities and adhere to the 2024 Budget, Statement of Economic and Financial Policies, and the Finance Act of 2023 and 2024. ZIJ/8/11/2023