Lebanon trying to trim country's spiraling budget
Lebanon witnessed an alarming deterioration in public finances over 2012
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The Finance Ministry has forwarded an amended 2013 budget proposal to the Cabinet, cutting expenditures by over $1 billion in a bid to curb the soaring deficit, said a statement released by the ministry over the weekend. Public spending was fixed at LL22.229 trillion ($14.1 billion), after LL2,000 trillion of budget cuts were introduced to the original budget draft, which was announced last September.
The deficit was capped, according to the proposal, at LL5.247 trillion.
Lebanon witnessed an alarming deterioration in public finances over 2012.
The budget deficit increased to LL5.252 trillion, or 28.67 percent of expenditures in the first 11 months of 2012, compared to LL2.940 trillion in the same period in 2011.
The primary surplus, which excludes the cost of debt servicing, receded to just LL97 billion in 2012, dropping to merely 0.53 percent of expenditures from 16.69 percent of expenditures, or LL2.518 trillion, a year earlier.
Some experts have warned that Lebanon, for the first time in 12 years, would see a primary deficit of $460 million by end-2012 after additional expenses, resulting from a minimum wage increase approved in February 2012, are included.
Another wage hike for the public sector would further deepen the budget deficit, if approved by the Cabinet and Parliament. The Finance Ministry did not include the wage hike demanded by civil servants in its 2013 budget proposal.
The Union Coordination Committee, a body which represents public sector employees and teachers, launched an open-ended strike on Feb. 19, and held a series of protests outside several ministries and key public institutions in demand of salary raises.
On Saturday, UCC members protested at the car registration offices and vowed to uphold demonstrations until the government refers a draft wage hike bill to Parliament for approval.
“We blame the open-ended strike on the Cabinet,” a statement by the UCC said, calling on Prime Minister Najib Mikati to pass the wage hike plan without any amendments.
On Monday, the UCC plans to demonstrate in front of the premises of state-owned landline operator OGERO in Beirut’s Beir Hassan district at 10 a.m.
“[On Monday] we will uphold the strike and halt all administrative work in ministries and other public departments,” the statement said.
The Communist Party also rallied Sunday near the Grand Serail in Beirut in solidarity with the UCC.
Former Labor Minister Charbel Nahhas, who spoke at Sunday’s rally, said Mikati had lost his official mandate as prime minister after failing to refer the wage hike.
The secretary-general of the Communist Party Khaled Hadadah criticized the Cabinet and said it “has not disassociated itself from anything but its duties.”
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