The Minister of Finance, Denise K. Vandi, has stated that the 2023 budget will prioritise programmes and policies that will enhance economic resilience and protect the livelihoods of the most vulnerable in the country. He made this statement whiles presenting the FY 2023 Government Budget and Statement of Economic Policies in the well of Parliament on Friday, 11th November 2022.
Minister Vandi Furthered that, the theme for this 2023 Budget is “Addressing the needs of the vulnerable in the context of the multiple crises” sighting that Sierra Leone, like the rest of the world, has been experiencing multiple crises brought on by the COVID- 19 pandemic, the ongoing crisis in Ukraine and the intensifying risks of climate change. Indicating that because the frequency and duration of these crises are unpredictable, they have disrupted supply chains, created uncertainty, and exacerbated shortages of key essential commodities, causing a sharp rise in the prices of food, fuel and fertiliser to an unprecedented level.
Therefore, he stated that Government will continue to implement programmes and policies to mitigate the impact on the population, especially the vulnerable groups like intensifying local food production and facilitating food importation to address food insecurity, especially for the most vulnerable groups; sustain critical investments in education and health to improve human capital; expand social safety nets to enable vulnerable people to cope with the challenging economic situation; pursue adaptation and mitigation measures in response to climate change risks; promote private sector development for job creation;
contain inflation and stabilise the exchange rate to lower the cost of living; strengthen public finances and maintain sustainable debt levels; and improve governance and accountability.
He revealed that the provided revenue and expenditure projections and budgetary allocations for the 2023 fiscal year are based on revenue measures and the projected increase in economic activities. Stating that domestic revenue for the financial year 2023 is projected at NLe9.35 billion (14.0 percent of GDP) and total expenditure and net lending for 2023 is projected at NLe15.1 billion (22.7 percent of GDP) compared to NLe13.7 billion (25.7 percent of GDP) for 2022. Of this, recurrent expenditure will amount to NLe10.9 billion (16.4 percent of GDP). Capital expenditure will amount to NLe4.2 billion (6.3 percent of GDP), of which, domestic financed capital expenditures will amount to NLe1.2 billion.
He pointed out that the budget would not introduce any new taxes with all current rates of taxation remaining unchanged in 2023. He added that Efforts to raise revenues will focus mainly on strengthening tax compliance and broadening the tax base, noting that Government would escalate the Duty Waiver Policy approved by Cabinet in March 2022 to law.
Denise Vandi disclosed that in terms of Human Capital Development, Education, Government would allocate a total of NLe2.1 billion to the education sector, accounting for 22 percent of the total discretionary budget to support basic, secondary, higher and TVET education.
He furthered that Government would continue to support the implementation of enhanced revenue mobilization and accountability reforms in local councils to minimize their over-reliance on central government grants to deliver devolved services.
“The government would develop and roll out revenue mobilization strategies for district councils, develop and implement a new fiscal decentralization policy and strategy that would provide additional revenue streams to local councils and boost local revenue collection; and also develop a modernized property tax system to reflect current valuation and property roll to increase the tax base for the city and municipal councils” he added. the Minister of Finance continued that Government’s public financial management reforms are on the foundation of transparency, accountability, and system strengthening for good governance.
“I am pleased to report that these reforms are yielding positive outcomes, as evidenced by Sierra Leone’s improved performance across multiple public financial management assessments, including the World Bank’s Country Policy and Institutional Assessment (CPIA), the Public Expenditure and Financial Accountability Assessment (PEFA), the Open Budget Survey and the MCC Scorecard,” he added.
He noted that the government will build existing reforms, take action to strengthen the financial independence of the Audit Service Sierra Leone, accelerate the implementation of the Auditor General’s recommendations and improve the performance and governance of State-Owned Enterprises, including State-Owned Banks.
The Minister disclosed the Government will implement the 45 percent increase in salaries for teachers for the next three years, starting with an annual increase of 15 percent in January 2023; the final 25 percent increase in salaries for the security sector, as pronounced in the 2021 budget speech, implying that the security sector would have received a 75 percent increase from 2021 to 2023.
He further noted that there would be a recruitment of 2,000 Police Officers as follows; 1,000 effective January 2023 and another 1,000 effective March 2023 and the recruitment of 500 health workers, which is part of the delayed recruitment for the FY2022 quota.
MOF Media and Communications Unit
11th November 2022