ALL YOU WANTED TO KNOW ABOUT THE MINISTRY OF FINANCE AND DEVELOPMENT PLANNING AND THE LIBERIA REVENUE AUTHORITY BUT DIDN’T KNOW WHO TO ASK
The Government of Liberia in 2006 embarked upon an ambitious program to reform the public sector ministries, agencies and commissions to make them leaner and more focused to perform their core functions by eliminating duplications and overlaps, in line with international best practices. In furtherance of this reform agenda, the Government decided to consolidate the core public finance, economic management and development planning functions into a single agency called the Ministry of Finance and Development Planning (MFDP) as well as to establish the Liberia Revenue Authority (LRA) to ensure all functions of revenue collections and management are optimized. The new structure will ensure the devolution and transfer of transactional and sector related management activities currently undertaken by the Ministry of Finance to line ministries.
Over the last several months, the Government of Liberia high-level Steering Committee created by the President in early 2011 and supported by a team of highly experienced organizational and institutional experts from the African Center for Economic Transformation (ACET), the Governance Commission and the Law Reform Commission, as well as an independent communications firm, worked assiduously with the Governance Commission and key focus persons from the Ministry of Finance and the Ministry of Planning and Economic Affairs, wherein series of consultations were held with the public and private sector pertaining to the draft Acts of the MFDP and the LRA.
This FAQ addresses key issues and queries arising out of these consultations. It also provides answers to other concerns that might not have been captured during the consultations.
1. What is the MFDP?
The Ministry of Finance and Development Planning is a completely new ministry created by an Act of the National Legislature in September 2013 to consolidate the core public finance, economic management and development planning functions of Government.
2. Is the Ministry of Finance and Development Planning (MFPD) a merger of the Ministry of Finance (MoF), and the Ministry of Planning and Economic Affairs (MoPEA)?
No. The Ministry of Finance and Development Planning is not a merger of the Ministry of Finance and the Ministry of Planning and Economic Affairs. In reality, the two ministries have been dissolved, while their core functions incorporated into the MFDP to better synchronize the public finance, economic management and development planning functions of Government.
3. What is the organizational structure of the MFDP?
The organizational structure of the MFDP comprises four key Departments: (i) Department of Economic Management; (ii) Department of Fiscal Affairs and Budget; (iii) Department of Development Planning; and (iv) Department of Administration, as depicted on the MFDP website.
4. What happens to the Revenue Department?
In place of a Revenue Department within the Ministry, the GoL has established the Liberia Revenue Authority, a semi-autonomous agency of government. The LRA is tasked with mobilizing and collecting national revenues as specified in the Revenue Code of Liberia or related law; administering, accounting and enforcing revenue collection laws and regulations; and educating taxpayers in tax compliance. The new Ministry, however, retains the core function of fiscal policy, within the Fiscal Affairs Division under the Department of Fiscal Affairs and Budget. The LRA also liaises closely with this new Division.
5. Why were certain functions of the MFDP devolved to Line Ministries?
The devolution of transactional and sector related management activities to line ministries is intended to reduce MFDP’s transactional burden and allow it to focus on the critical strategic work of policy formulation, economic planning, financial analysis and decision making. Whereas MFDP retains final oversight on finances, line ministries will be empowered to undertake additional functions relating to their day to day operations. In order to ensure the devolution is effective and successful, capacity building within the line ministries will be undertaken to guarantee that all devolved transactions are being carried out to a satisfactory standard.
6. What happens to the assets, personnel and remaining budget of the Ministry of Finance and the Ministry of Planning and Economic Affairs once the MFDP comes into existence?
All assets, personnel and remaining budget of the two old ministries are automatically transferred to the MFDP. Pending approval of the new position structure and staffing pattern of the Ministry of Finance and Development Planning, all staff of the Ministry of Finance and the Ministry of Planning and Economic Affairs retain their current positions and corresponding salaries. After the approval, here is what actually happens to the 2200 staff of both Ministries. The new Liberia Revenue Authority (LRA) will absorb 1100 staff. This number represents the current configuration of staffers of the Revenue Department of the Ministry of Finance. The new MFDP will incorporate 600 personnel from the Ministry of Finance and the Ministry of Planning and Economic Affairs. These are staffers who have already been vetted during the Staff Audit conducted by ACET.
7. What happens to the remaining 500 personnel of the Ministry of Finance and the Ministry of Planning and Economic Affairs who are not absorbed in the MFDP?
The remaining 500 personnel who do not get absorbed in the MFDP fall in several categories:
a. Retired Workers are those staffers who meet retirement criteria. They will receive the standard retirement package from Government.
b. Induced retirees are those staffers with few years left to retirement but who wish to be induced to retire. They will receive the standard retirement package from Government.
c. Transferred Workers are those staffers who will be rerouted by the Civil Service Agency (CSA) to different Ministries, Agencies and Commission based on demand and staff skills.
d. Redundant Workers are those staffers vetted by independent HR consultants and found wanting in the skills and qualifications needed for the new MFDP. They will receive severance packages, business skills development training, psychosocial counseling, and have access to micro-credit facilities.
8. Who can I contact for additional information on the Ministry of Finance and Development Planning the Liberia Revenue Authority?