-On Accelerating Decentralization and Improving Fiscal Transparency
By: G Bennie Bravo Johnson
To advocate for accelerating of decentralization, enhancing fiscal transparency and improving domestic resource mobilization in Liberia, the United States Agencies for International in conjunction with the Ministry of Finance Development Planning, Liberia Revenue Authority, and the Ministry of Internal Affairs through the USAID LEAD Activities concluded a day long national dialogue on the decentralization and improvement of fiscal transparency.
The national dialogue held at the Ellen Johnson Sirleaf Ministerial Complex on Thursday, April 4, 3024, under the theme “Accelerating Decentralization, Improving Transparency and Mobilizing Resources” underscored a five years initiative that the USAID seeks to partner with the government of Liberia to generate resources, improve fiscal transparency and support decentralization of revenue mobilization to ensure basic services reach all sectors of Liberia.
Officially opening the national dialogue, the Charge’ D’ Affaires of the United States Embassy, Catherine Rodriguez asserted that transitioning from goods and service tax to value added tax will align Liberia with global best practices and present an opportunity to significantly increase domestic revenue.
“Transitioning from goods and service tax to value added tax will align Liberia with global best practices and present an opportunity to significantly increase domestic revenue.
The goal is by 2027, value added tax, the national budget will increase by 40% to reach the national budget to one billion. The increased revenue could be used for so many development needs.”
The US diplomat lauded the government of Liberia for progress that has been made to effectively transform Liberian.
“We want to be cleared, crystal cleared that the government of Liberia is in the driver seat. We are already seeing progress being made in the right direction from the new administration.We have seen significant government support.”
The Charge’ D’ Affaires of the United States Embassy further lauded the government for the call for audit across all government agencies and employed the government to take firm actions of audit recommendations by identifying deficiencies and making corrections.
“Public resource mobilization comes for the need for oversight and accountability needed for oversight and accountability of the resources. Audits itself are not enough, there must be a concrete action taken on audit findings and recommendations to address, identify deficiencies and make recommendations
Speaking at the fiscal transparency and decentralization of revenue mobilization dialogue, the USAID LEAD Activities chief of party George Akl postulated that
decentralization fosters inclusive governance, empowering local communities to make decisions that directly impact their lives by devolving power and resources closer to the people.
He added that the USAID will ensure that their voices are heard, and their needs are met effectively. And that decentralization promotes efficiency in service delivery, enabling prompt responses to local challenges and enhancing accountability
“Firstly, decentralization fosters inclusive governance, empowering local communities to make decisions that directly impact their lives. By devolving power and resources closer to the people, we ensure that their voices are heard, and their needs are met effectively.
Furthermore, decentralization promotes efficiency in service delivery, enabling prompt responses to local challenges and enhancing accountability. At the same time, decentralization will also require that accountability and transparency are ensured at both the local government and central government levels, requiring efforts to promote good governance practices.”
He intimated that improvement of fiscal transparency is indispensable for building trust and confidence in the government. Adding that transparent fiscal practices demonstrate Liberia’s commitment to accountability and integrity, reinforcing investor confidence and attracting foreign investments. And that through transparent budgeting, expenditure, and revenue collection, the public resources are utilized efficiently and equitably.
In furtherance, Akl asserted that
the improvement of domestic resource mobilization in Liberia is a matter of utmost importance. As it navigate the complexities of economic development and strive for self-sufficiency, the effective mobilization of domestic resources becomes paramount.
The US diplomat further provided domestic resource mobilization is not merely a financial endeavor, but it boosts the capacity to generate revenue internally, the government can reduce dependency on external aid and pave the path towards fiscal independence.
Stating that it is the cornerstone of economic empowerment and sustainable development.
“Domestic resource mobilization is not merely a financial endeavor; it is the cornerstone of economic empowerment and sustainable development. By bolstering the capacity to generate revenue internally, the government can reduce dependency on external aid and pave the path towards fiscal independence.”
Meanwhile, he acknowledged that the road to achieve domestic resource mobilization may be arduous, but it is not insurmountable.
Therefore, stated that Liberia must address inefficiencies in revenue collection and plug leakages to maximize its fiscal potential. Stating that there are opportunities to explore innovative strategies, to unlock untapped revenue streams.
He asserted that achieving meaningful progress in domestic resource mobilization necessitates a collaborative approach amongst government agencies, private sector stakeholders, and civil society.
Therefore, they must work hand in hand to enact policies, implement reforms, and foster an environment conducive to economic growth.
At the same time, the ministry of finance department planning through the deputy minister of budget and development planning, Tenneh G. Brunson, on behalf of the government stated that the government is keen about efforts leading to decentralization, fiscal transparency and resource mobilization to enhance Liberia’s developmental drive.
Adding that the Government and its partners are working to
improve fiscal transparency and accountability.
Adding that it is crucial to increasing public confidence and building citizens’ trust in governance and development
The deputy minister of budget and development planning stated that it is an effort to improve budget transparency, and urged the USAID to collaborate with the Government of Liberia (GOL) relevant bodies to promote the culture of disclosure of public and fiscal information, thereby enhancing coordination of fiscal transparency, and increasing citizens’ participation.
“It is an effort to improve budget transparency, we ask USAID to collaborate with the Government of Liberia (GOL) relevant bodies to promote the culture of disclosure of public and fiscal information, thereby enhancing coordination of fiscal transparency, and increasing citizens’ participation.
LEAD İs also encouraged to work with relevant counterparts to enhance local
government capacity, strengthen the sub-national DRM and public financial management (PFM) systems, and increase citizens’ participation in local governance which will ultimately lend to an improved local development and service delivery.”
She intimated that these are well-intentioned interventions that have the potential, and if implemented well, to augment the Governnment of Liberia’s efforts.
Stating that it is why the government grateful and welcome the USAID LEAD Activity which, enhance revenue mobilization, will also accelerate decentralization for better development and economic growth, increase public confidence and enhance citizens’ trust in governance and development through fiscal transparency and accountability.
And as well actively discuss audit reports for transparency and accountability and as well as enhance local authorities capacity in Public Financial Management and increase efficiency in public service delivery.
“This is why we gratefully welcome the USAID LEAD Activity which, beside enhancing revenue mobilization, will also accelerate decentralization for better development and economic growth.
Increase public confidence and enhance citizens’ trust in governance and development through fiscal transparency and accountability; actively discuss audit reports for transparency and accountability: enhance local authorities’ capacity in Public Financial Management; increase efficiency in public service delivery.”
The pivotal role of the USAID LEAD Activity is in support of three objectives.
Decentralization – Through the LEAD Activity, work to strengthen local institutions, promote participatory decision-making, and empower the grassroots level.
The fiscal transparency – USAID LEAD Activity will work on enhancing budget transparency, strengthen revenue collection mechanisms, and promote prudent financial management.
The domestic resource mobilization – The USAID LEAD Activity will work towards improving revenue generation capacities, optimizing tax systems, and enhancing public financial management with the ultimate target of supporting Liberia in financing its own development priorities.
It is asserted that by accelerating decentralization, improving fiscal transparency and increasing domestic resource mobilization, we pave the way for a more prosperous and accountable Liberia.
