BEIRUT

Lebanon News

Comprehensive deal needed to end Cabinet expenditure row: Terro

Minister of the Displaced Alaaeddine Terro. (The Daily Star)

BEIRUT: The Progressive Socialist Party (PSP) reiterated Thursday it would only back a comprehensive settlement that encompasses disputed expenditures by Cabinets since 2005 in order to resolve the thorny issue of government overspending.

“PSP lawmakers will only vote for a draft law that settles the disputed accounts of previous governments [under former prime ministers Fouad Siniora and Saad Hariri],” Minister of the Displaced Alaaeddine Terro told The Daily Star Thursday.

“We support a comprehensive settlement for spending undertaken by all governments that we were represented in and the current one as well,” Terro said.

Cabinet failed Wednesday to authorize the LL8.9 trillion in overspending by the government of Prime Minister Najib Mikati for 2011.

Finance Minister Mohammad Safadi was quoted as saying Wednesday he placed confidence in Mikati and Speaker Nabih Berri to persuade PSP MPs to vote for his original plan to approve the overspending.

The crisis in Cabinet surfaced weeks ago after President Michel Sleiman refused to sign a decree authorizing the expenditure. Sleiman attributed his refusal to sign to reservations on Safadi’s proposal by the Finance and Budget parliamentary committee.

Earlier this year, parliamentarians from the opposition March 14 coalition and the PSP blocked the passing of Safadi’s proposal in Parliament, saying that the accounts by Siniora and Hariri’s Cabinets needed to be settled first.

March 8 coalition ministers insist Sleiman use his constitutional prerogatives to sign the decree as failure to reach a solution would prevent the government from meeting its financial obligations.

Sources close to the March 8 alliance have said the Hezbollah-led coalition seeks to resolve the spending crisis without having to settle the accounts of Cabinets that were led by their rivals between 2005 and early 2010.

Terro said the Cabinet could adopt a mechanism used by previous governments to take treasury advances to facilitate spending but that would only delay a financial predicament.

PSP officials are scheduled to meet Thursday with Wafiq Safa, Hezbollah’s top security chief, over lunch to discuss several issues, including the issue of government overspending.

The PSP argues that all political forces in the present government were also represented in the former governments and that “they all participated in extra-budgetary spending.”

As the political deadlock continues, the Cabinet is heading toward a financial crisis if it fails to pay the salaries of public sector employees as well as future vital payments such as debt servicing.

 

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