BEIRUT

Lebanon News

Cabinet approves emergency funds, shelves overspending issue

  • President Michel Sleiman, center, heads a Cabinet session at the Presidential Palace in Baabda , east of Beirut, Wednesday, May 16, 2012. (The Daily Star/Dalati Nohra, HO)

BEIRUT: The Cabinet failed Wednesday to resolve the thorny issue of retroactively approving government spending, while approving “emergency” expenses to head off simmering crises on a range of fronts. During a session chaired by President Michel Sleiman at Baabda Palace, ministers approved emergency funds for, among other things, the Lebanese Army, the Internal Security Forces, government hospitals and NGOs active in aiding the disabled.

“The Cabinet approved allocating exceptional funds to cover emergency expenses under exigent circumstances,” Information Minister Walid Daouk told reporters following the session.

He said that, in accordance with Article 85 of the Constitution, the government can allocate “exceptional and emergency” funds to resolve a pressing issue.

Daouk said the Cabinet allocated LL15 billion ($10 million) to the Army, LL7.5 billion to the Internal Security Forces, LL1.25 trillion to the Education Ministry to conduct end-of-year examinations, LL2 billion to Camille Chamoun Stadium and LL700 million for the Finance Ministry to cover maintenance costs.

Finance Minister Mohammad Safadi had said that the work of the Army and security agencies would be threatened if the Cabinet failed to approve sufficient funding.

Daouk said the just-released emergency funds were intended to pave the way for the Cabinet to approve the 2012 state budget.

Government hospitals also received a Treasury loan for an undisclosed amount of money, following fears that the Sidon Public Hospital was facing closure, while ministers endorsed an increase in spending for NGOs that aid the country’s disabled.

The new spending formula will take effect June 1, provided that the necessary funds are formally endorsed when the 2012 budget is approved.

The president of the Permanent Coordination Office of NGOs helping the disabled told The Daily Star that the decision was a fruitless attempt to help NGOs that are in the process of permanently closing their doors due to lack of funds.

“It’s like telling a thirsty person in the middle of the desert that there is a bottle of water 5 kilometers away,” Raif Shwayri told The Daily Star.

According to Shwayri, the only positive thing was that the government had agreed on adopting a cost appraisal formula carried out last year.

“This decision is irrevocable – in the past all funds were made based on a 2004 cost appraisal formula,” Shwayri said.

But he added that the decision to boost the NGOs’ funding as of June completely disregarded their expenses for the first five months of 2012.

A proposal to endorse a separate amount of money – in the form of a Treasury loan of LL4.9 trillion to cover public sector expenses for the first four months of this year – was discussed during the session but did not receive approval.

The proposal for the LL4.9 trillion, by Safadi will be relayed to Parliament for approval, according to political sources. Prior to the session, Safadi predicted that his proposal would not receive approval.

The loan would be used to pay nearly LL1.1 trillion in interest on public debt, LL865 billion in the form of a loan to the state-run Electricite du Liban, and LL806 billion as reserves to cover development, social and road construction projects.

Meanwhile, a revised draft law authored by Safadi which would retroactively authorize extra-budgetary spending of LL8.9 trillion (nearly $6 billion) for 2011, was taken off the Cabinet’s agenda.

The Cabinet has not agreed on a means to authorize LL8.9 trillion in overspending. Sleiman refused to sign a decree to legalize the amount after it failed to win consensus in Parliament.

March 8 ministers describe Safadi’s revised draft law as unconstitutional and insist Sleiman sign the decree.

 
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