Monrovia — A controversial directive from Liberia's Finance Minister Mr. Samuel Tweah has many Liberian government vendors scratching their heads.
"Kindly note that with the exception of payroll checks the bank will not honor any other payment without a release form Finance Ministry." - Ecobank LiberiaBanks are reportedly refusing to honor checks from government institutions without a form from the Minister's office, FrontPageAfrica has learned.
But Minister Tweah told FPA via phone Tuesday that the measure is simply an enforcement of a Presidential mandate.
"We are only following an order from the President. The President has issued financial directives that will ensure that he effectively controls government spending."
Following his inauguration in January, President Weah issued an Executive Order, directing all autonomous agencies and public corporations of the government to authorize and expend a cumulative amount of not more than US$3,000 for operational expenses.
"Any amount above the US$3,000 threshold must seek approval from the Office of the President," instructed the directive.
The order went on to direct Human Resource Managers and all relevant signatories of the various autonomous agencies and public corporations of government are further authorized to pay all legitimate salaries and other benefits to their employees.
But many government offices and agencies still without managers or heads because no one has been appointed, have been struggling to get basic operating essentials to work. But the Minister said in some instances, exceptions are being made once it is clear what the funds are being used for.
The President in his inauguration speech promised to stamp out corruption, transform the economy and 'construct the greatest machinery of pro-poor governance in the history of this country'.
Bank Puts Vendors on Notice
Communications obtained by FrontPageAfrica suggest that Ecobank Liberia is reportedly notifying vendors of the new policy which makes it clear that checks without the form from the ministry will not be honored.
"Kindly note that with the exception of payroll checks the bank will not honor any other payment without a release from Finance Ministry," one of the communications noted.
An Ecobank executive confirmed to FrontPageAfrica Tuesday that only vendors whose names are on a list from the Finance Ministry would not experience bounced checks.
Nevertheless, it appears government institutions and agencies may not be aware of the new policy as many continue to issue checks to vendors who are finding it difficult to cash.
The policy is being heavily criticized by many vendors who are already struggling to adjust amid a difficult and tight economy with many unsure how long the order will remain in place as some government offices struggle to fund their daily operations.
Mr. Tweah acknowledged this much during his confirmation hearing before the Senate's Ways, Means and Finance Committee when he declared that that there are no quick fixed solutions to the country's economic challenges.
"The economy today is not good; the numbers we are seeing are not good. Our challenges began with the Ebola crisis and to where we are now."
"The fall in the prices of our major commodities, including rubber and iron ore, took a big hit," Mr. Tweah said.
The economic downturn is also being hampered by a high demand for foreign exchange and people are willing to pay any amount just to get the US dollars while businesses in Liberia are stranded - stranded for their own monies saved with various commercial banks in the country due to the inability of the banks to payout certain amounts in both Liberian and U.S. Dollars.
Critics are slamming the finance Minister's controversial policy, suggesting that he may be overstepping his bounds as this should not be the main focus right now.
"We have to graduate from having our finance Ministers becoming deeply involved in a routine-financial-transaction such as managing payroll and accounts payable. Finance Ministers should focus on managing the real economy."
Responding to his critics, the Minister said Tuesday - "We are giving some exemptions to key people especially at entities where a head has not been appointed by the President. The measure is for control purposes. It is giving us a lot of insights as to what is happening in the country. There is nothing wrong there and the President order is still in force and I as Minister am not going to violate that order."