21 June 2012

South Sudan Austerity Budget Hurts the Poor

Hundreds of people have protested in Sudan's capital Khartoum, despite a police crackdown on them. Demonstrations against the government's ... ( Resource: Sudan Anti-Government Protests Continue )


South Sudan started to think austerity right after the shutdown of oil production earlier this year.

The economic bites made this country to proposed cut of national expenditures to save some money for basic government services. This week, the Minister for Finance put across a budget of SSP 6.4 billion with the hope that the non oil revenue shall fill up the gap left behind by the oil proceeds. The National Assembly for South Sudan delegated a team in the House to look into the whole budget activity by activity and pass it back for final approval.

But before the budget comes formal from Parliament, already it has come under fire. There are voices that tend to think that the Manibe Budget might not achieve its intended targets of spending cut or reduce costs, but worsens things for ordinary person on the streets of our cities.

Generally, the austerity practice is about discipline in spending, something we lack (I will say it again below). Austerity policy is applied by any government when there is that problem of sharp decline of liquidity; it is all bout bringing down deficit or allow revenues to par with expenditures. South Sudan neighbor Sudan had gone a little further to do more, even proposing slash of government constitutional posts to pave the way for more savings.

But South Sudan budget at its current state is problematic and can cause more social problems (unrest) than what was envisaged by the writers of this budget to help the simple man with services. One that problem is false believe that the cut will leave room for services to the population. That is utterly not going to happen in our situation. Experience with our government is that our officials aren't discipline with spending, and therefore a tall order to request that to happen in our time when Kiir sharks are still in power. Paul Kagame is the right man to be here...

In a glance, so not to waste your time before expressing suggestions of what should be done by law makers, the budget is half about security (3.3. billions), and you wonder why so. Security, security, year in year out, is getting out of taste; it is not anymore good idea when our men are still not stopping the Goliath from raining fire from the air. Why should we believe the leaders now that they will go for ithe anti-aircraft missiles when they didn't do it for the past seven years of budget allocation. Magaya men are also proving a nuisance, as security remains a nightmare throughout the country.

Members of Parliament therefore need to balance carefully and not to pass the minister budget that way. Some of his priorities are misplaced. I thought the minister would be interested to raise taxes and leave the salaries of the staff untouched including their allowances. There is increment to an already institutions that bulging, and that was uncalled for. We can go without foreign embassies but we can't go without food on our tables. No need for Road Authority at this point in time. Constitutional posts are too many, a well tailored decision should have made. One of these is to cut the constitutional post holders salary by half, and leave the salary of unclassified staff in tact.

Parliament should amend the constitutions to reduce institutional load; it unviable economically even if the oil production resumes later. We will still face with money problem. Too many mouth to feed at the end of the month when in fact there are few activities happening in those institutions, is not a fun. May be that is a decision beyond the House or Manibe, but to save money or make it is the mandate of everybody. Cost factor strays to politics. Economy is political at times.

Imagine a poor cleaner living within 600 SSP a month, how will the economy of this poor person look like after the cut by 100 SSP? Living standard in Juba and other major cities have double, and no right minded person could do a cut, saved for Manibe and the company. Government ought to raise the salaries of the staff not to do reduce them. There is money out there in the private sector also that could have been tapped, including these revenues through imports and duties. Money that comes through taxation alone is enough to seal the gap. I see no reason to punish civil servants. They have suffered in silence and doubt whether they will be quiet this time. Avoid troubles by being proactive and objective!

But also, Hon. Minister Kosti should have been positive; during his speech in the House, the man was relatively experimental, non committal and unsure. This was too bad about any political figure in such a serious platform. It is gloom today but the future of our country is too bright and promising!

Isaiah Abraham lives in Juba

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