THU 25 - 4 - 2024
 
Date: Jul 23, 2016
Source: The Daily Star
Lebanon: 2017 state budget still has to clear major hurdles
Hussein Dakroub| The Daily Star
Despite Prime Minister Tammam Salam’s expressed optimism that Lebanon would soon have an approved state budget for the first time in more than a decade, there are at least three major obstacles that could torpedo the 2017 draft fiscal plan, ministerial sources said Friday. Although all ministers unanimously agreed during a Cabinet session this week on the importance of passing a state budget, viewed as crucial to tackling a crippling economic and financial crisis, the devil lies in details.

Among contentious issues that could hinder or scuttle the ratification of the 2017 draft state budget are demands by key blocs for closing previous accounts of extra-budgetary spending, particularly the $11 billion spent by former Prime Minister Fouad Siniora’s government between 2005 and 2009; the financing of the Special Tribunal for Lebanon, which is trying to uncover the killers of former Prime Minister Rafik Hariri; and calls for including a long-standing wage hike bill for civil servants into the budget.

“The Cabinet has come out with an agreement on the necessity of approving the state budget. But this is facing complications because there are essential points that could prevent an agreement,” Minister of State for Parliamentary Affairs Mohammad Fneish, one of two ministers representing Hezbollah in the Cabinet, told Akhbar al-Yom news agency. “Furthermore, referring the budget to Parliament is not guaranteed because Parliament is prevented from doing its job due to the presidential vacuum. Therefore, it is not possible to approve a budget.”

Fneish pointed out that among the obstacles facing the state budget is insistence by some blocs on linking its approval to closing previous accounts and including the STL’s funding into the budget.

Because of Hezbollah’s staunch opposition to the STL, Lebanon has been transferring through a government agency, and not the Cabinet, $36 million to the tribunal, its annual budget contribution to the U.N-backed court. The payment, which constitutes 49 percent of the tribunal’s budget, comes despite opposition by Hezbollah which has dismissed the STL as an “American-Israeli conspiracy.”

Hezbollah has asked the government to cut funding to the tribunal and withdraw Lebanese judges. The tribunal has indicted five Hezbollah members in connection with the 2005 bombing that killed Hariri and 21 others. Their trial in absentia is ongoing.

MP Michel Aoun’s parliamentary Change and Reform bloc linked the approval of the budget to closing previous accounts.

“The passing of a draft law on closing previous accounts is very essential. It is a condition for the government to pass it before the approval of the budget,” former Salim Jreissati from the Free Patriotic Movement told reporters following the bloc weekly’s meeting Tuesday.

Social Affairs Minister Rashid Derbas warned of dire consequences for the country’s economy if the 2017 state budget was not approved.

“If the state budget is not approved, a number of ministers will protest and exert pressure to ensure its approval because the country cannot continue without a budget,” Derbas told The Daily Star. He said he would be one of the ministers who will press for the budget’s approval.

Acknowledging the hurdles standing in the way of the budget’s approval, Derbas, who is close to Salam, said a solution could eventually be found to the sensitive issue of closing previous accounts concerning billions of dollars in extra-budgetary spending.

Similarly, he said, “the STL’s funding will take place as happened before.”

Derbas said that he supported the attempt to include the salary raise bill for government employees into the state budget “because it is the people’s right to rectify their wages.”

“It is better for the country to have an approved budget,” he said, adding that because of the absence of the budget, employees at his ministry sometimes are left without getting paid their salaries for months.

Echoing Salam’s optimism, Information Minister Ramzi Joreige said he expected the state budget to be passed within the next two months “once obstacles have been eliminated.”

“I expect solutions to be found to the problems of the STL’s funding and closing previous accounts,” Joreige told The Daily Star. “Similarly, most ministers are in agreement on the need to include the salary hike bill [for civil servants] into the state budget,” he added.

“Prime Minister Salam has declared that all the ministers support the approval of the budget. Therefore, this goal will be achieved in the interest the country and the Lebanese,” he said.

Commenting on Hezbollah’s opposition to the STL’s funding, Joreige said: “The STL is a reality that cannot be ignored. The funding has been taking place every year. So, I don’t expect a problem this year.”

In presenting a detailed report on the country’s dire finances to the Cabinet, Finance Minister Ali Hasan Khalil and economic experts said the approval of the 2017 state budget is vital for coping with soaring public debts, estimated at $71 billion, an annual $4 billion budget deficit and a low economic growth.

A day after discussing Khalil’s report and proposals to deal with the financial and economic crisis, Salam said Tuesday he felt for the first time that ministers had shown seriousness on the need to pass a state budget. He said he expected Lebanon to have a budget in the next two months.

Lebanon has not approved a state budget since 2005 due to obstructive political wrangling among the rival factions.


 
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