GOVERNMENT BUDGET AND STATEMENT OF ECONOMIC FINANCIAL POLICIESparliament.gov.sl/dnn5/Portals/0/2014 DOCUMENT/BUDGET/2018 BU… · AND STATEMENT OF ECONOMIC FINANCIAL POLICIES ...

GOVERNMENT OF SIERRA LEONE

GOVERNMENT BUDGET AND

STATEMENT OF ECONOMIC FINANCIAL POLICIES

For the Financial Year, 2018

Theme: “STRENGTHENING RESILIENCE FOR INCLUSIVE GROWTH”

DELIVERED BY:

MOMODU L. KARGBO MINISTER OF FINANCE AND ECONOMIC DEVELOPMENT

In the Chamber of Parliament

TOWER HILL, FREETOWN

ON

FRIDAY 27TH OCTOBER, 2017 At

10:00 AM.

MR. SPEAKER, HONOURABLE MEMBERS

It is again with honour, on behalf of His Excellency, President Ernest BaiKoroma that I rise to move that the Bill entitled "The Appropriation Act 2018" beingan Act to authorize expenditure from the Consolidated Revenue Fund for the servicesof Sierra Leone for 2018 be read the first time.

I. Introduction

2. Mr. Speaker, Honourable Members, in the last decade this economy was on apositive trajectory, recording impressive growth performance with a stablemacroeconomic environment.

3. However, external shocks (fall in commodity prices) and natural disasters(Ebola Viral Disease, mudslides and floods) have at the same time undermined theeconomy's ability to sustain its impressive growth. Consequently, over the last year,Government has been faced with a number of financial challenges and difficultpolicy decisions, compounded by the need to re-establish economic stability, whilesetting the stage for growth and economic transformation.

4. These challenges notwithstanding, I am pleased to report that through ourexpenditure rationalization measures, we have achieved considerable progress inrestructuring our public finances thereby bringing our expenditure profile into betteralignment with revenue. Lessons from the combined effects of the external shocksand natural disasters have underscored the need to strengthen the resilience ofour economy.

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5. Accordingly, the implementation of prudent economic policies combined withthe resilience of our people and with support from our development partners enabledus to overcome these crises and returned the economy to positive growth rate.Consequently, the economy recovered in 2016 and is now stabilizing as the exchangerate has been relatively stable since the beginning of 2017 while inflationary pressuresbegan to ease in the second half of this year.

6. However, significant medium term challenges remain amidst persistenteconomic fragilities. We still need to continue to improve road infrastructure, energyand water supply. There is also the urgent need to provide housing for the poor,continue to improve health and sanitation facilities and ensuring food security.However, addressing these challenges requires improvement in our revenuegeneration. Despite significant efforts to raise domestic revenue in recent years,the key structural issue of low fiscal revenues remains.

7. Thus, the 2018 budget is underpinned by the International Monetary Fund(IMF) Extended Credit Facility (ECF) arrangement, which was approved in June thisyear. The main objective of this new ECF programme is to enhance revenuemobilization and expenditure control and management to achieve fiscal sustainabilityand robust medium term growth. Aggressive revenue mobilization will ensure thefinancing of critical expenditures, and gradually strengthen our self-reliance.

8. Mr. Speaker, Honourable Members, against this background, the driving forcebehind this budget is our enduring passion and desire to bring sustained prosperityto all Sierra Leonean citizens as defined in our Agenda for Prosperity. In elaboratingthe 2018 budget, we have relied on the policies and programmes articulated in theAgenda for Prosperity and the Economic Transformation Programme laid out in the2017 budget. Furthermore, my pre-budget hearings involving consultations with MDAsallowed us to establish the underlying principles underpinning this budget, whichfocuses on strengthening resilience for economic transformation and inclusive growth.

9. In this context, the 2018 budget addresses the following:

(i) implementation of sound macroeconomic policies;

(ii) intensifying domestic revenue mobilization;

(iii) Continue to diversify the economy through investments in agriculture,fisheries and tourism;

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(iv) scaling up investment in infrastructure (roads, electricity and watersupply);

(v) Building human development;

(vi) Expanding social protection systems; and

(vii) protecting the environment and strengthening disaster management;

Layout of Budget Statement

10. Mr. Speaker, Honourable. Members, my statement to this Honourable Housethis morning is divided into five parts. Part One, is the review of global and domesticeconomic developments and outlook. Part Two, is the presentation of the details on"Strengthening Resilience and Promoting Inclusive Growth", which is the themeof this budget. Part Three, present the details of the 2018 budget. Part Four, is ananalysis of imminent challenges and risks. In Part Five, I give my closing remarks.

PART ONE

Global Economic Developments and domestic economic performance and Outlook

11. Mr. Speaker, Honourable Members, let me now provide an update on global,regional and domestic economic developments and outlook and their implications forour economy.

I. Global Economic Development and Outlook

12. Mr. Speaker, Honourable Members, the IMF has projected global economicgrowth to increase from 3.2 percent in 2016 to 3.6 percent in 2017 and further to 3.7percent in 2018. With the exception of the UK and the US, the outlook for advancedeconomies, especially the Euro-area and Japan, has improved due to strong domesticdemand. Growth in emerging market and developing economies is also expected torise from 4.3 percent in 2016 to 4.6 percent in 2017 and 4.9 percent in 2018. Inparticular, China's growth is expected to remain high, averaging 6.3 percent overthe medium term.

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13. To some extent, the rise in global price of oil is already having an impact inthe economic policy management of Sierra Leone. Oil being a sensitive commodity isimportant for revenue generation and also a key driver of inflation.

14. Mr. Speaker, Honourable Members, at the regional level, in particular, Sub-Saharan Africa, the growth rate is forecasted to improve from 1.4 percent in 2016 to2.6 percent in 2017.

II. Macroeconomic and Budgetary Performance in 2017

Macroeconomic performance

15. Mr. Speaker, Honourable Members, on the domestic front, our economyshowed encouraging signs during the first half of 2017. Following the recovery in2016, economic activities continued to expand during the year. Accordingly, theeconomy is projected to grow at 5.6 percent in 2017. Excluding iron ore, the economywill grow by 3.5 percent. Inflation moderated to 17.8 percent in September 2017 asthe exchange rate continued to stabilize and the availability of domestic food supplyimproved.

16. Total exports amounted to US$436.7 million during the first half of 2017, a49.7 percent increase over the same period in 2016. Exports growth benefitted fromincrease in non-traditional exports specifically from the fisheries sector, thus,indicating gradual diversification of our export base. Total imports amounted to US$737.4 million, about 31 percent higher than imports for the same period in 2016,mainly due to higher importation of food and fuel.

17. As a result, the trade deficit increased to US$ 300 million from US$ 271million for the first half of 2017.

18. Commercial bank credit to the private sector increased by 8.0 percent duringthe first half of the year, mainly to the construction, commerce and service sectors.

19. The stock of external public debt stood at US$1.47 billion as at June 2017,compared to US$1.35 billion at end December 2016. The stock of domestic debt stoodat 3.87 trillion Leone as at end June 2017 compared to 3.62 trillion Leone as at endDecember 2016.

Budgetary Performance.

20. Mr. Speaker, Honourable Members, budgetary performance during the firsthalf of 2017 has been encouraging. Total domestic revenues collected during thefirst half of 2017 amounted to 1.7 trillion Leone and is projected to reach 3.5 trillionLeone or (12.1 percent of GDP) by end 2017.

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21. In the light of the continuing global uncertainties, total grants for the firsthalf of 2017 amounted to 79.6 billion Leone, compared to a projected amount of285.8 billion Leone due mainly to the dwindling of donor inflows. This short fall hasproven to be challenging and a cause for constantly recalibrating our expenditure inthe face of growing demands.

22. Total expenditure and net borrowing for the first half of 2017 amounted to2.95 trillion Leone compared to the budget of 3.17 trillion Leone.

23. Wages and salaries amounted to Le 932 billion and Interest payments, 300.4billion Leone. Non-salary, non-interest recurrent expenditures amounted to 863.1billion Leone.

24. Capital expenditure amounted to Le 851 billion for the first half of the yearand is projected to reach 2.13 trillion Leone by end 2017. Of this, domestic capitalexpenditure amounted to 565.0 billion Leone.

Budget Deficit and Financing for First Half of 2017

25. The overall deficit including grants amounted to 1.20 trillion Leone for thefirst half of 2017 and is projected to reach Le 1.70 trillion by end of the year. Excludinggrants, the overall deficit amounted to 1.28 trillion Leone and is estimated at 2.20trillion Leone by the end of 2017.

26. Domestic financing of the budget deficit was estimated at 796.3 billion Leone.Of this, bank financing was 779.3 billion Leone and non-bank financing, 17 billionLeone.

PART TWO

STRENGTHENING RESILIENCE FOR INCLUSIVE GROWTH

A. Medium Term Macroeconomic Objectives and Policies

27. Mr. Speaker, Honourable Members, our medium term macroeconomicobjectives are to maintain macroeconomic stability by focusing on ensuring fiscaland debt sustainability, reducing inflation, strengthening our international reservesand attaining sustainable inclusive growth.

28. To achieve these objectives, Government will pursue a mix of fiscal, monetary,exchange rate and financial policies.

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29. Mr. Speaker, Honourable Members, the economy is projected to grow by 5percent in 2018. Economic growth will increase to 6.2 percent in 2019 and 7.0percent in 2020. Excluding iron ore, the economy will grow by 3.5 percent in 2018.Non-iron ore growth will increase to 5.9 percent in 2019 and 6.6 percent in 2020.Inflationary pressures are projected to moderate over the medium term. Inflation isexpected to decline to 11.0 percent by end 2018 and return to single digit by the endof 2019, as the exchange rate stabilizes and food production increases. The currentaccount deficit is projected to moderate to 18.1 percent of GDP in 2018 from 21percent of GDP in 2017, underpinned by the projected 20 percent increase in exports.In spite of the projected decrease in the trade deficit, the current account deficitwill increase to 18.6 percent of GDP in 2019 and 19.0 percent of GDP in 2020 due tothe decline in official external grants. Gross foreign reserves are projected to increasefrom US$448 million (2.3 months of imports) in 2018 to US$695 million (3.0 months)of imports in 2020.

I will now summarize the policies to achieve these macroeconomic objectives:

(i) Fiscal policy

30. A key objective of fiscal policy in 2018 and the medium-term is to enhancedomestic revenue mobilization, so as to provide resources for effective delivery ofpublic services. Currently, domestic revenue as a percent of GDP is 12.1 percent,which is below the Sub Saharan Africa average of 17 percent of GDP. Research bythe Fiscal Affairs Department of the International Monetary Fund concluded that acountry needs to ensure that its revenue is at least 20 percent of its GDP in order toeffectively fund its programmes. As a result, policies will focus on increasing domesticrevenue from 12.1 percent of GDP in 2017 to 15.2 percent by 2020.

31. To this end, Government has prepared a comprehensive Domestic RevenueMobilisation Strategy, which focuses on: (i) strengthening revenue mobilisation; (ii)legislative and public financial management reforms to consolidate Governmentrevenues collected by all Ministries, Departments and Agencies of Government intothe Consolidate Revenue Fund (CRF) consistent with the Fiscal Management andControl Act, 2017; and (iii) policy reforms to broaden the tax base.

32. In tandem, Government will rationalize public expenditures and maintainthem at an average of 22 percent of GDP over the medium-term to improve publicservice delivery. Key measures in this regard include furthering public financialmanagement reforms through the implementation of a medium-term payroll strategy;automation of the budget execution process; strengthening contract management;and improving the transparency and competitiveness of public procurement.

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(ii) Monetary, Exchange Rate and Financial Sector Policies

33. Mr. Speaker, Honourable Members, the main focus of monetary policy in themedium term will be to achieve low inflation, stable exchange rate, and supportcredit growth to promote private investments. To achieve these objectives, the Bankof Sierra Leone (BSL) will continue to use market-based instruments to steer theinter-bank rate.

34. The exchange rate will continue to be market determined while interventionsby the Bank of Sierra Leone in the foreign exchange market will be limited to containingtemporary excessive volatility of the Leone. In addition, the Bank of Sierra Leone(BSL) will also aim at building foreign exchange reserves to serve as a buffer insupport of a credible management of the exchange rate. Government will enforcethe provisions of the Exchange Control Act that requires exporters of commercialmerchandise to repatriate export proceeds within 90 days from the date of export.

(iii) Public Debt Management

35. Mr. Speaker, Honourable Members, Government's external debt policy overthe medium term is to utilise a mix of highly concessional loans and grants from ourdevelopment partners to ensure debt sustainability and avoid the risk of high debtdistress. With regards to domestic debt, Government will continue to deepen thedomestic debt market by lengthening the maturity of debt instruments.

B. Economic Diversification

36. Mr. Speaker, Honourable Members, we recognize the risk of overdependenceon a few sectors, especially mining. Therefore, diversification of our economy andjob creation remain the key strategy. To actualize this, we are adopting measures tonurture our local industries, increase local production and foster resilience to externalshocks to enable the emergence of a competitive private sector.

37. To this end, Government is renewing its commitment to diversify the economythrough investments in agriculture, fisheries, tourism and promoting the "Made inSierra Leone Brand" as described below:

(i) Agriculture

38. Mr. Speaker, Honourable Members, Agriculture has been targeted as one ofsectors for special focus within the diversification strategy because of its inherentpotential, the realization, of which, will inter-alia:

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* contribute to food security and export;

* displace food imports thereby saving foreign exchange;

* enhance farmers agricultural income;

* create job opportunities; and

* generate industrial spill offs through agro-processing.

39. The sector, from early indications, will record favourable performance, mostnotably for sorghum, which benefited from the Local Content Policy and the 2016Finance Act.

40. Mr. Speaker, Honourable Members, to reduce our dependence on importedrice, emphasis will continue to be placed on increasing domestic rice production toattain self-sufficiency as well as reduce the high import bill. Trade statistics indicatethat, up to US$108 million has been utilized for the importation of rice for the firstsix months of 2017.

41. Mr. Speaker, Hon Members, I will like to draw your attention to the importantfigure of US$108 million mentioned above as being the amount utilized by merchantsto import rice for the first half of the year. This magnitude of foreign exchangeresources utilized to import rice that can be produced locally is among the mainfactors that makes it difficult to stabilize the Leone.

42. Therefore, the primary and urgent objective in Agriculture is to achieve selfsufficiency in rice production - the staple food of the country in the shortest possibletime. To this end, in addition to ongoing efforts such as Smallholder Commercializationand Agribusiness Development project (SCADEP) funded by the World Bank, newinitiatives are on the offer. MoFED has approached the Indian Exim Bank for a loanof US$ 30 million to undertake rice production in Tormabum. The Bill and MelindaGates Foundation through the Islamic Development Bank (IDB) will fund theAgricultural Intensification and Diversification project, which will largely be devotedto rice production. In addition, Government will request the World Bank to allocateUS$ 50 million from our IDA-18 allocation to support rice production in the country.

43. Mr. Speaker, Honourable Members, Government is developing a comprehensiveprogramme with the support of the African Development Bank that will transformour agricultural input system through establishing a Leasing Facility for farmmachinery and equipment. The project will also facilitate a market based inputsupply system and established an Agricultural Financing Bank. This will increaseaccess to agricultural finance as well as de-risk financing for agricultural activities.

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In addition, the programme will also facilitate the development of commercialaquaculture schemes through the setting up of system and support services for theconstruction of fish ponds nationwide.

44. To attract private sector investment in rice, the Ministry of Finance andEconomic Development and the Ministry of Agriculture, Forestry and Food Securityare collaborating with Standard Chartered Bank to encourage OLAM Agribusinesscompany to invest in rice production and marketing in Sierra Leone.

(ii) Fisheries45. In the fisheries sector, efforts will continue to reduce Illegal, Unreported

and Unregulated (IUU) fishing through various surveillance initiatives including theinstallation of Vessel Monitoring Systems (VMS) in all licensed vessels and thedeployment of Monitoring Officials on board the vessels. Government is also developinga new Fisheries Bill, that includes, among others, a specified licence fees for industrialfishing vessels that will be submitted to this noble House for enactment. Governmentis also exploring the option of collaborating with the private sector to construct andmanage a fish habour.

(iii) Tourism46. The recent increase in tourist arrivals, mushrooming of new hotels and

hospitality facilities all over the country, is a positive indication of the potential ofthe tourism sector to expand. This is another clear evidence of the realisation of ourdiversification objective. To consolidate these gains, Government will support thepreservation, protection and marketing of the rich cultural history and heritage ofSierra Leone and strengthen the institutional capacity of Arts and Culture.Government will also support the restoration of proclaimed cultural heritageinfrastructure. The Government will encourage activities promoting domestic tourismincluding popularizing field visits by schools to tourist sites such as the TacugamaChimpanzee Sanctuary and the Tiwai Birds Sanctuary in Bo and Bunce Island.These efforts will be supported through existing arrangements aimed at enhancingthe creative industry, support to tourism product development, tourism infrastructureand tourism marketing. These will enhance the sector's contribution to employmentand wealth creation.

(iv) Promoting Made in Sierra Leone

47. Mr. Speaker, Honourable members, I launched the Made in Sierra Leoneconcept last year when I was presenting the 2017 budget. While we continue toencourage MDAs to procure products made in Sierra Leone, we are also workingwith the Ministry of Trade and Industry, the Sierra Leone Chamber of Commerce,Industry and Agriculture and other trade promoting agencies to anchor this initiative

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within the African Growth and Opportunity Act (AGOA) project. The primary objectiveis to address issues of specification and quality to meet international standards.This will provide incentives to Sierra Leoneans to produce, package and export productsthat meet international standards.

48. An initiative in this direction is the purchase of local rice for the uniformedforces with the Sierra Producing Marketing Company as a conduit. This is an exampleof the kind of initiative we encourage MDAs to embark on. Such initiatives all overthe country are bound to promote the development of Small and Medium Enterprises(SMEs). Furthermore, Government will increase access to finance to producers oflocal products through the strengthening of the Credit Reference Bureau andCollateral Registry.

C. Scaling Up Infrastructural Development

49. Mr. Speaker, Honourable Members, a critical element in building resilienceand promoting inclusive and sustainable growth is to improve the state ofinfrastructure in the country, including enhancing road and port infrastructure,expanding access to electricity supply, information and communications technologyand water supply.

During the last decade, Government has made significant investments in thesesectors. For the medium term, Government will continue in this direction.

(i) Roads

50. Mr. Speaker, Honourable Members, we are beginning to see significantimprovements in the road network across the country. This is contributing to theease of movement of goods, services and people, as well as lowering cost oftransportation. Hardly any district exists today in the country without a major roadfully constructed or under construction. Every district has also benefitted from severalkilometers of paved streets. In this regard, Government will continue to fund all on-going road projects to completion. Key among these are the Makeni-Kamakwe road,Hillside Bye-Pass road, Hill Cut road, and the Lumley-Tokeh road. Amongst newroads that will start during the 2018 fiscal year is the Kambia- Kamakue road.

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Electricity

51. Mr. Speaker, Honourable members, gone are the days when Freetown wasreferred to as the darkest city in West Africa and when “Kabbah Tiger” generatorsruled the day. All of us seated here, be you SLPP, APC or non-partisan can attest tothe major turnaround in the provision of electricity supply beyond Freetown to theother major regional capital cities. It is particularly important to note that reliableand affordable supply of electricity is critical to sustaining economic activities aswell as improving standard of living. Government, therefore, remains committed toincrease electricity supply to meet the demand of industry, businesses and households.To achieve this, the Government will continue its policy on energy mix of thermal,solar, hydro and other renewable energy supply. Improving the transmission anddistribution network remains a priority. Additional electricity projects are in thepipeline to increase the total installed capacity. Key among them are:

* 57 megawatt CEC project, awaiting ratification by this Noble House.

* Phase two of the Bumbuna hydroelectric project, that will provide 140megawatts. This project was recently discussed with MIGA of the WorldBank Group in Washington DC by my good self,

* 30 megawatts HFO plant is expected as a grant from the People's Republicof China,

* 30 megawatts of HFO plant to be funded by the Government of SierraLeone and is currently out for tender.

* 50 megawatts solar power jointly funded by the Government of Kuwaitand the Government of Sierra Leone to be installed in the GbantiKamaran chiefdom.

* The Cote D’Ivoire, Liberia, Sierra Leone and Guinea (CLSG) project thatwill be transmitting electricity among the four countries of the ManoRiver Union under the West African Power Pool Arrangements.

52. Mr. Speaker, Honourable members, this is progress indeed, for which theGovernment must be lauded.

Information and Communication Technology (ICT)

It is encouraging to note that we are increasing our usage of ICT, thanks in part tothe installation of the fibre optic cable. The utilization of technology for internet andmobile money services has increased.

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Water Supply and Sanitation

53. Mr. Speaker, Honourable members, Government will invest in the watersector to increase access to safe, clean, and portable water across the country. Tothis end, in 2018, Government will significantly increase investment along the watersupply chain, starting with dams, bulk water supply schemes and wastewaterinfrastructure.

54. With respect to sanitation, Government continues to promote community-ledapproaches to sanitation, which has involved youth participation in Keep the CityClean sanitation programme. Government will also support environmental health,waste management, and health education programmes to improve sanitationcountrywide

D. Building Human Development

(i) Education

55. Government will continue to support all on going programmes and projects inthe education sector to increase access to and improve quality of education. Thus,Government will continue to provide fee subsidy for primary schools, tuition feesubsidy for students in tertiary institutions, teaching and learning materials andpay examination fees for public examinations. The aim is to improve retention andpass rates, especially for girls.

The 2018 budget will pay particular emphasis to early childhood education, skillstraining and integrity issues in the education sector.

(i) Early Childhood Education

56. Government will place emphasis on Early Childhood Education country wideto ensure that children start primary education at the right school going age. Thefocus will be on strengthening the foundations of learning by ensuring school readinessand transition from pre-primary to primary and build basic learning skills. Governmentwill expand the school feeding programme, targetting additional 500,000 pupils.

(ii) Skills Training

57. Mr. Speaker, Honourable Members, Government will embark on middle levelmanpower training to improve the employability of our youth. During 2018, twelveTechnical and Vocational Institutes constructed through the support of ourdevelopment partners will be made functional. Through support for a competitiveskills development fund, the World Bank is also preparing a skills development project.

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The beneficiaries of the project will include employees and employers of businessesin productive sectors, industry associations, students and staff of public and privatetraining institutes, universities, polytechnics and relevant Government agenciesengaged in skills development. The European Union is also funding a capacity buildingand systems strengthening project in the Ministry of Education, Science andTechnology.

(ii) Integrity issue

58. Government is very much concerned about the growing integrity issues inthe education sector. Key among them are high school extra charges and theexploitation of girls in schools. To address these challenges, Government has set upa task force to look into these issues. The report of the task force will informGovernment's actions on how to restore credibilty in the sector.

Health

(i) Tackling Infant and Child Mortality

59. Mr. Speaker, Honourable Members, Government will continue to support theFree Health Care Initiative, Teenage Pregnancy project, and nationwide ChildImmunization programmes to reduce the high infant, under-five and maternalmortality rates.

(ii) Reproductive Health and Family Planning

60. Mr. Speaker, Honourable Members, according to the 2015 census data, thepopulation in Sierra Leone increased by more than 40 percent between 2004 and2015. This implies that if the population growth stays the same by the next censusin 2026, the Sierra Leone population will be minimum 10 million. Providing basicservices to meet the requirement of the expanded population will no doubt be adaunting task. With the explosive population growth, issues of population should bean integral aspect of our development planning and policies in order to address theimpact on the economy.

61. Mr. Speaker, to ensure effective management of the projected increase inour population, especially where 80 percent of the population is below age 35 years,Government will prioritise Family Planning. This is key if we are to achieve thetargets on the Sustainable Development Goals (SDGs). Thus, in 2018 and beyond,Government will pay more attention to sexual and reproductive health in line withthe SDGs. We need to make sure that the available resources are spent wisely oneducation of girls as well as providing unhibited access to quality family planninginformation especially to adolescent girls.

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62. Mr Speaker, Honourable members, planning how the family grows defineshow children are raised, how their education is paid for and how much accessfamily members get to good health care facilities. This requires the empowerment ofour woman and adolescent girls to choose whether and when to have children. Thisin turn empowers them to make free and informed decisions in all aspects of theirlives. They can stay in school longer, earn a degree or establish a business whichwill ultimately lead to making their families, communities and countries prosper.This can only be achieved through effective and efficient family planning programs.Delivering contraceptives is not enough, a more wholistic approach involving men toappreciate and play their part in support of women's reproductive role and familyplanning is necessary.

(iii) Tackling Diseases

63. Mr. Speaker, Honourable Members, increasingly, diabetes, cancer, high bloodpressure, HIV/AIDS, Hepatitis and related health conditions are being diagnosed atan alarming rate and requiring outside medical intervention. In many of these cases,most of the people cannot afford to seek medical treatment abroad and therefore,Government has been intervening by covering the cost of treatment overseas. Thissignals that, in addition to the expensive primary health care programmes,consideration should be given to improve diagnostic and treatment facilities for thesemedical conditions.

E. Protecting the Environment and Disaster Management

64. Mr. Speaker, Honourable Members, to protect the environment and mitigatethe impact of natural disasters, significant investment and continued efforts areneeded to strengthen institutions and activities aimed at enhancing resilience toclimate change and disasters. Most important, is a shift towards an integrated andpro-active approach to disaster risk management. As the recent landslidedemonstrated, housing represents a major share of reconstruction needs. The tragedyin Freetown is an opportunity to revisit the underlying decision-making structuresthat impede urban planning and management, and develop a spatial strategy toaddress the environmental challenges of the Western Area.

In this regard, Government has placed low cost affordable housing at the centre ofits public social policy. In 2018, the Ministry of Lands, Country Planning and theEnvironment will develop a National Resettlement Policy. The Ministry will alsoprepare two Bills (i) a Town and Country Planning Bill and (ii) Freetown ImprovementBill for submission to this Honourable House for enactment.

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To complement Government's effort, the World Bank is developing a number ofinterventions (i) the Freetown Urban Development and Disaster Risk Managementproject, (ii) the Freetown Urban Transport project, and (iii) the Multi-SectoralEmergency Recovery project. All of these will focus on key reconstruction and disasterprevention activities.

65. Mr. Speaker, Honourable Members, to improve our disaster preparednessand response systems, early warning mechanisms will be adopted to ensure readinessand appropriate actions prior to the occurrence of a disaster. Some of these measuresinclude: (i) sensitising the population, especially for people living in disaster proneareas; (ii) integrating risk management into Government policy decision-making;and (iii) establishing and capacitating the appropriate institutions that will respondin a timely manner to natural disasters.

F. Expanding Social Protection Systems

66. Mr. Speaker, Honourable Members, given the frequency of internal andexternal shocks, there is now greater need to expand our social protectionprogrammes. In this regard, Government will enhance support to existing socialsafety net programmes for vulnerable people to reduce poverty.

67. Government with support from its Development partners will also throughthe National Commission for Social Action (NaCSA) provide income support in theform of cash transfers to 38,083 vulnerable households, an additional 17,000 fromthe current 21,083.

G. Strengthening Economic Governance

68. Mr. Speaker, Honourable Members, following the completion of the Regulationsof the Public Financial Management Act 2016, Government has commencedimplementation of various provisions of this Act to strengthen the budgetary process,including expenditure control and reporting, automating the budget execution process,as well as cash asset and liability management and identification of macro-fiscalrisks.

(i) Treasury Single Account (TSA)

69. Our most important priority in this regard is to commence the implementationof the Treasury Single Account (TSA) system. The implementation of the TSA willallow us to aggregate receipts from all government sources to compute the overallcash overdraft position of the Government each day. The TSA will give us betteroversight of public finances, improve cash management and reduce reliance on bankfinancing. The recently enacted Fiscal Management and Control Act, 2017 mandatesall MDAs to place their revenues in the TSA.

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(ii) Improving the Integrity of the Government Payroll

70. Mr. Speaker, Honourable Members, my Ministry continues to implement anumber of payroll reforms, in collaboration with key stakeholders resulting in tightercontrols and transparency in the Government payroll. The overall objective is toachieve an affordable and a sustainable wage bill. Going forward, Government hasdeveloped a medium-term payroll strategy to comprehensively address issues suchas payroll integrity; wage bill budgeting and monitoring; pensions costs, and dualemployment. Efforts are being made towards establishing a Salaries and WagesCommission, which will address among others, the disparity in pay and remunerationacross the public service.

(iii) Public Procurement

71. Mr. Speaker, Honourable Members, public procurement is an integral aspectof effective public financial management. With the support of our developmentpartners, we have initiated the transition to an E-Procurement system, which willenhance the efficiency and transparency of the public procurement processes andinstill confidence and trust in the management and implementation of Governmentcontracts. Following the enactment of the revised Public Procurement Act 2016, theaccompanying Regulations are being finalized for submission to this HonourableHouse. Furthermore, the Standard Bidding Documents and the Procurement Manualwill be updated following Parliamentary approval of the Regulations.

72. The Expenditure and Contract Management Committee (ECMC) in the Ministryof Finance and Economic Development has been strengthened by the inclusion ofthe National Public Procurement Authority (NPPA) and the Law Officers Departmentas members. The Committee now has a clear mandate with well-defined proceduresand processes to conduct adequate reviews of the procurement process.

PART THREE

The 2018 BUDGET

Objectives of the 2018 Budget

73. Mr. Speaker, Honourable Members, consistent with the medium-termobjectives of the recently approved ECF programme by the Executive Board of theIMF, the 2018 Budget and the medium term will seek to make growth more inclusiveand sustainable. This will be achieved through sound fiscal framework with room forexpanded infrastructure, social spending and structural reforms to encourage private

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sector participation. The projected growth rate of 5 percent will be supported byincreasing public investment on roads, energy, agriculture, education, health aswell as spending on social safety net programmes.

Budgetary Resources for 2018

74. Mr. Speaker, Honourable Members, domestic revenue mobilization wouldresult in the fiscal space necessary to sustain and expand public investment ininfrastructure and social programmes, while preserving macroeconomic stability anddebt sustainability.

Mr. Speaker, Honourable Members, the 2018 Budget will seek to raise revenuewithout:

(i) Introducing any new tax; and

(ii) Without raising tax rates in any category

Emphasis will be placed on strengthening tax administration including enforcing taxcompliance, closing loopholes and reducing duty and tax exemptions.

75. In this regard, domestic revenue is projected at 4.56 trillion Leone or 13.3percent of GDP for 2018 compared to 3.52 trillion Leone or 12.1 percent of GDP for2017. Total grants expected from our development partners will amount to 658.3billion Leone or 1.9 percent of GDP. Of this, budget support will amount to 264 billionLeone. Project grants will amount to 386 billion Leone.

Domestic Revenue Mobilisation Measures for 2018

76. Mr. Speaker, Honourable Members, the main policy objectives of the RevenueMobilization Strategy (RMS) are highlighted in the Fiscal Strategy Statement that isbeing laid today for the information of Honourable Members. The RMS focuses on:

(i) Strengthening revenue administration. The aim is to expand theregistration of tax payers, enforcement of payment of taxes byprofessionals; enforcement of payment of withholding taxes on rentalproperties; strengthen the capacity of the National Revenue Authorityto undertake specialized auditing of large firms in telecommunications;mining, banking and commerce; automation of Tax AdministrationProcesses; and improving Goods and Services Tax (GST) administrationand compliance.

(ii) Public Financial Management Reforms. This involves (a) theestablishment and operationalization of the Treasury Single Account(TSA); and (b) the implementation of the Fiscal Management and ControlAct, 2017 to consolidate off-budget revenues into the ConsolidatedRevenue Fund;

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(iii) Policy Reforms. In addition to strengthening tax administration,Government will introduce policy reforms to broaden the tax base bytackling the issue of generous and ad-hoc tax and duty exemptions.These reforms will include: elimination of GST exemptions and reductionin duty waivers, adoption of the ECOWAS Common External Tariff (CET);and an adjustment of the prepayment of income tax upon importation.

77. Mr. Speaker, Honourable Members, Government will also support LocalCouncils to improve revenue collection. In particular, Government will: (i) providetechnical and advisory support to local councils to develop their respective revenuemobilization strategies; (ii) support Councils to fully realize their property tax revenuepotentials; (iii) allocate grants to Local Councils based on their revenue mobilizationefforts; and (vi) harmonize the property cadastre and business licenses systemswith improved internet connectivity that will enhance control and ease supervision.

2018 Expenditure Priorities and Allocations:

Mr. Speaker, Honorable Members, in support of the objective to increase publicinvestment and expanding our social safety net programmes, the 2018 AppropriationBill projects expenditures at 7.28 trillion Leone, of which, 6.33 trillion Leone is fordomestically funded programmes. Recurrent expenditures are projected at 4.83 trillionLeone. Capital spending is projected at 2.46 trillion Leone. Of this, domestic capitalexpenditure is projected at 1.05 trillion Leone. Foreign financed capital expenditureis projected at 1.41trillion Leone.

Wages and Salaries are projected at 2.07 trillion Leone.

Interest Payments

78. Total interest payments will amount to 952 billion Leone. Domestic interestpayments will amount to 854 billion Leone and foreign interest payments, 98 billionLeone.

Subsidies and Transfers

79. Total subsidies and transfers are projected at 606.9 billion Leone. Grants totertiary educational institutions are projected at 206.3 billion Leone; Transfers toLocal Councils, 139 billion Leone; Road Maintenance Fund Administration, 128.9billion Leone; National Electoral Commission for Elections and Democratization, 131billion Leone; of which, 8 billion Leone is foreign contribution.

19

80. Mr. Speaker, Honourable Members, I will now present the non-discretionaryexpenditures for both recurrent and capital by sector.

Pillar 1: Diversified Economic Growth

Mr. Speaker, Honourable Members, this pillar is allocated an amount of 101.6 billionLeone from the recurrent budget and 21.4 billion Leone from the domestic capitalbudget to support the diversification process. Donor partners will provide an amountof 175.3 billion Leone.

Government is allocating 53.2 billion Leone from the recurrent budget to support theMinistry of Agriculture, Forestry and Food Security including 34.4 billion Leone forfood security; 11.7 billion Leone for the procurement of fertilizers for farmers; 7.1billion Leone for the procurement of seeds and 6.8 billion Leone for the procurementand distribution of agricultural processing equipment. In addition, developmentpartners will provide 172.5 billion Leone to support various projects.

81. The Ministry of Fisheries and Marine Resources is allocated 4.02 billionLeone from the recurrent spending to support various activities, including theprocurement and distribution of appropriate fishing gears for artisanal fisher folk.Government is also allocating 3.7 billion Leone from the domestic capital budget tosupport the promotion of Inland Fisheries and Aquaculture; and the European FishCertification Project, among others. The sum of 5 billion Leone from Food Securitybudget under The Ministry of Agriculture, Forestry and Food Security will also bespent on fisheries, taking the total allocation to 9.02 billion Leone for 2018.

82. Government is allocating 5.5 billion Leone from the recurrent budget and3.8 billion Leone from the domestic capital to the Ministry of Tourism and CulturalAffairs. In addition, 6.3 billion Leone from the recurrent budget is allocated to theNational Tourist Board, including 728 million Leone for the Tourism MarketingStrategy and 3.0 billion Leone from the domestic capital budget for the LumleyBeach Development Project and the Peninsula Beaches Development Project.Government is also providing 2.1 billion Leone to the Monuments and RelicsCommissions from the recurrent budget and 1.8 billion Leone from the domesticcapital budget.

20

83. Government is also allocating 23.6 billion Leone for devolved functions underAgriculture and Food Security and 582 million Leone for Fisheries and MarineResources.

Pillar 2: Managing Natural Resources

84. Mr. Speaker, Honourable Members, Government is allocating 16.6 billionLeone from the recurrent budget and 2.7 billion Leone from the capital budget tothis sector. Development partners will contribute 11.5 billion Leone to this sector.

85. The Ministry of Lands, Country Planning and the Environment is allocated4.1 billion Leone from the recurrent budget for administrative and other activities.In addition, development partners will provide 10.0 billion Leone in support of theNational Land Policy Reform Project and Lands Registration Project. Governmentcounterpart contribution to these projects will amount to 750 million Leone. Anamount of 738 million Leone will go towards Forestry Division of the MinistryAgriculture, Forestry and Food Security.

86. An amount of Le 2.9 billion is allocated to the Ministry of Mines and MineralResources and 3.2 billion Leone to the National Minerals Agency. The NationalProtected Area Authority is allocated 2.1 billion Leone while Sierra Leone MaritimeAdministration is allocated 1.8 billion Leone and the Meteorological Agency is allocated1.3 billion Leone.

Pillar 3: Accelerating Human Development

87. Mr. Speaker, Honourable Members, Government is allocating 618.7 billionLeone from the recurrent budget and 169.0 billion Leone from the domestic capitalbudget to this pillar. Development partners will also contribute 291.3 billion Leone tothis sector.

88. An amount of 369.6 billion Leone accounting for 36.1 percent of total non-salary, non-interest recurrent budget is allocated to the Ministry Education, Scienceand Technology. Of this, 139.5 billion Leone is allocated to Improving Access toQuality Education, including 73.8 billion Leone for the school feeding programme; 18billion Leone as Grants-in-Aid to University students; 14 billion Leone as Grants-in-aid to Government Boarding Schools, 11.6 billion Leone as examination fees to WAECfor WASSCE and 6.5 billion Leone for the Girl Child Programme.

89. In addition, an amount of 222.3 billion Leone is allocated to Tertiary Education,Technical and Vocational Training. Of this, 159.0 billion Leone is for Tuition Fees

21

Subsidies for University students; 47.3 billion Leone as Grants to Tertiary Educationalinstitutions; and 9.4 billion Leone for the Student Loan Scheme. Developmentpartners will contribute 45 billion Leone for the rehabilitation of Fourah Bay Collegewhile Government counterpart contribution to this project is 3.5 billion Leone. Anamount of 62.2 billion Leone is allocated to devolved education services.

90. Mr. Speaker, Honourable Members, The Ministry of Health and Sanitation isallocated an amount of 107.4 billion Leone, accounting for 10.5 percent from thenon-salary, non-interest recurrent budget. Of this, 12.9 billion Leone is allocated toprimary health care services, including Malaria, HIV/AIDS, and Tuberculosisprevention and control programmes; 8.5 billion Leone to Reproductive and ChildHealth Care Services including Immunization and Family Planning programmes;26.1 billion Leone to Tertiary Health Care Services; and 26.6 Leone for theprocurement of Free Health Care Drugs. In addition, 10 billion Leone is allocatedfrom the domestic capital budget to Public Health Sierra Leone. Development partnerswill contribute 125.3 billion Leone to support various projects in the health sector.Government counterpart contribution to these projects will amount to 38.7 billionLeone. The Pharmacy Board Services is allocated 5.3 billion Leone. Devolved functionsin the health sector are allocated 30.4 billion Leone.

91. An amount of 113.8 billion Leone will be provided to support various watersupply projects. 9.3 billion Leone as grants to SALWACO; 1.6 billion Leone to theEmergency Recovery Priority Programmes on water.

Pillar 4: International Competiveness

92. Mr. Speaker, Honourable Members, this Pillar is allocated 750 billion Leonefrom the recurrent budget to promote the competitiveness of our economy. Governmentis also allocating 589.6 billion Leone from the domestic calital budget to this pillar.Development partners will also provide 864.4 billion Leone.

93. To this end, 136.4 billion Leone will go to increasing electricity generation,enhancing existing thermal plants, rebuilding and enhancing the distribution network.The road sector is allocated 426 billion Leone. Of this, 266.5 billion Leone is for therehabilitation and reconstruction of several trunks roads nationwide; 97.5 billionLeone for the rehabilitation of streets and roads in the Western Area; 62 billionLeone for the rehabilitation of streets in District Headquarter towns and selectedtowns. In addition, the Road Maintenance Fund Administration is allocated Le 128.9billion for road maintenance activities.

22

94. Development partners have also pledged 380.3 billion Leone to the EnergySector; 115 billion Leone to water sector; and 460 billion Leone to the roads sector.

Pillar 5 : Labour and Employment

95. Mr. Speaker, Honourable Members, Government has allocated an amount of22.3 billion Leone from the recurrent budget to this pillar. This includes 4.4 billionLeone to the Ministry of Youth Affairs. From the domestic capital budget, Governmentis allocating 8.7 billion Leone to support the National Youth Development,Empowerment and Entrepreneurship project; National Youth Service Programme;National Youth Village Project; Youth Farm and Youth in Fisheries Project. TheNational Youth Commission is allocated 5.1 billion Leone and National Youth Service,2.7 billion Leone. The Ministry of Labour and Social Security is allocated 8 billionLeone for administrative and other activities. In addition, Government is providing2.0 billion Leone for devolved functions for Youth and Sport services.

Pillar 6: Social Protection

96. Mr. Speaker, Honourable Members, an amount of 21.8 billion Leone isallocated from the recurrent budget and Le 51. 5 billion from the domestic capitalbudget to the Social Protection Pillar. Development partners have pledge 31. 6 billionLeone.

97. Government is allocating almost 13 billion Leone from the recurrent budgetto the Ministry of Social Welfare, Gender and Children's Affairs for Social ProtectionServices. Of this, 11.4 billion Leone to support Social Protection Programmes, including2.9 billion Leone for the Disability Commission; 1.7 billion Leone for Diet for ApprovedSchools and Remand Homes.

98. The National Commission for Social Action (NaCSA) is allocated 1.8 billionLeone from the recurrent budget and 51.8 billion Leone from the domestic capitalbudget for various Social Support Programmes. Development partners will contribute21.6 billion Leone in support of these programmes. Development partners will alsoprovide 10 billion Leone for the Post-Ebola Recovery Social Investment Project.

Pillar 7: Governance and Public Sector Reforms

99. Mr. Speaker, Honourable Members, Government is allocating 830 billion Leonefrom the recurrent budget and 359.8 billion Leone from the domestic capital to thispillar.

100. The Ministry of Foreign Affairs and International Cooperation is allocated 38billion Leone from the recurrent budget. An amount of 15 billion Leone is allocatedfrom the domestic capital budget for the rehabilitation of our foreign missions.

23

101. Mr. Speaker, Honourable Members, the Ministry of Finance and EconomicDevelopment is allocated 67.1 billion Leone from the recurrent budget, including43.3 billion Leone for the payment of subscriptions to international organisations.An amount of 14.1 billion Leone is also allocated from the domestic developmentbudget to support the activities of the ECOWAS Monetary Cooperation Programme,including West African Monetary Zone (WAMZ) programme and West African MonetaryAgency (WAMA); as well as the rehabilitation of the National Development BankBuilding.

102. Mr. Speaker, Honourable Members, Parliament is allocated an amount of15.3 billion Leone; Audit Service Sierra Leone is allocated Le 7.3 billion from therecurrent budget and 2.0 billion Leone from the domestic capital; Public ServiceCommission, 2.6 billion Leone from the recurrent budget and 800 million Leone fromthe capital budget for the construction of an office complex; Statistics Sierra Leone,7.7 billion Leone from the recurrent budget and 4.3 billion Leone from the domesticcapital budget for the conduct of various surveys; National Revenue Authority, 90.5billion Leone from the recurrent budget and 500 million Leone from the domesticcapital budget for the Modernization of Revenue Administration Systems; the NationalPublic Procurement Authority, 3.6 billion Leone; and Human Rights Commission,2.5 billion Leone. The Anti-Corruption Commission is allocated 6.1 billion Leone.

103. Government is allocating 123.9 billion Leone to the National ElectoralCommission for the 2018 Elections and other electoral activities. 106.7 billion Leoneto the Ministry of Defence including 25.1 billion Leone for rice supply to officers andother ranks; 97.5 billion Leone to the Sierra Police; 58.2 billion Leone to the SierraLeone Correctional Services; 11.7 billion Leone to the National Fire Authority; 9.4billion Leone to Office of National Security (ONS).

104. From the domestic capital budget, 95.3 billion Leone is allocated to theIntegrated National Civil Registration System Project; 1.6 billion Leone for the MachineReadable Passport and the Establishment of an Integrated Immigration ControlSystem. Government is also providing 2.7 billion Leone for the Rehabilitation ofMilitary Barracks and construction of Housing Units at Gondama and Wilberforceand 2.2 billion Leone for the construction of a Police Academy and police stationsaround the country.

24

105. Government is also allocating 5.9 billion Leone as Local GovernmentDevelopment grants, 10.1 billion Leone to the Constituency Development Fund and10.1 billion Leone to the Infrastructure Development Fund.

Pillar 8: Gender and Women's Empowerment

106. Mr. Speaker, Honourable Members, Government is allocating 2.3 billion Leoneto support Gender and Women activities the Ministry of Social Welfare Gender andChildren's Affairs in addition to what is allocated to the Ministry under pillars 6 forother services.

PART FOUR

Eminent Challenges and Risks

(i) Fiscal Risks and Mitigating Measures:

107. Mr. Speaker, Honourable Members, we face challenges associated withinternal and external shocks, including the recent mudslides and floods in Freetown.Our vulnerability to these shocks could derail the implementation of this budget ifthey materialize. These risks are summarized below.

(i) Low Revenue Collection

108. Mr. Speaker, Honourable Members, revenue mobilization is crucial to maintainmacroeconomic and fiscal sustainability in the near term. There is little room forexpenditure adjustment, given mounting expenditure pressures to sustain therecovery from Ebola and to meet the cost of funding the 2018 elections. If the revenuemeasures highlighted in the Domestic Revenue Mobilization Strategy are notimplemented, there is a risk that some critical programmes may not be completedgiven the limited availability of domestic financing as well as the limited scope to cutspending.

(ii) Commodity Price Shocks

109. Mr. Speaker, Honourable Members, commodity price shocks result in adverseterms of trade. Sierra Leone is an oil importer and petroleum products constitutethe second highest import value. Thus, a rise in international oil prices will adverselyaffect our revenue in the form of implicit subsidies (loss in excise duties), whileincreasing expenditures in the form of explicit subsidies (direct payments from thebudget). A fall in the price of iron ore, our major export will result in decrease inGDP, domestic revenues and exchange rate depreciation with adverse budgetaryimplications.

25

(iii) Macroeconomic Shocks

(a) Shocks to exchange rate

110. Mr. Speaker, Honourable Members, as our stock of foreign debt and debtservice payments are denominated in foreign currencies, a depreciation of theexchange rate will increase debt service payments in Leone terms for both interestand principal repayments with adverse effect on budget execution.

(b) Rise in Inflation

111. Any significant rise in inflation will result in higher expenditures in nominalterms. This is likely to increase the budget deficit.

(vi) Contingent Liabilities

112. Other fiscal risks to the budget include Contingent liabilities, which canarise when guarantees issued by the Government materialize or from failure toadhere to the terms of a Public-Private Partnership transaction.

(v) Natural Disasters

113. Natural Disasters such as the mudslides and floods or the re-emergence ofdiseases such as Ebola that could cause untold suffering on affected people and theeconomy as a whole through destruction of property, loss of lives and displacementof the people. This can derail budget implementation with resources diverted fromother critical areas to address the impact of these disasters.

(vi) Subsidies on Imported Rice and Petroleum Products

114. Mr. Speaker, Honourable Members, one of the main reasons for thevulnerability of our economy to external shocks especially the volatile movement incommodity prices is our heavy reliance on two strategic imports; that is; rice andfuel. Whilst rice is produced locally, fuel at the moment is imported.

115. With regards to rice, Government continues to subsidize urban consumersat the expense of our poor rural farmers who are engaged in rice production. Theresult has been low rice production and significant loss of foreign reserves on importingrice, with adverse implications for exchange rate stability. Government is reviewingthis policy with a view to ensuring that local rice producers are also provided withthe right incentive to stimulate domestic production of rice to enable us attain self-sufficiency and eliminate the high import bill for rice.

26

116. Mr. Speaker, Honourable Members, Government continues to subsidize fuelconsumption in the retail market as indicated by the difference between thecommercial and retail price of fuel in the domestic market. The result has beensignificant loss of domestic revenues during the year as international oil prices rosewhile the domestic pump price remained fixed in the retail market at Le6000 perlitre. At the time I presented the 2017 Budget, Platts price per metric ton wasUS$465 and the exchange rate was Le 7,389.62. As at the week beginning October23, 2017 Platts price per metric had risen to US$549 while the exchange ratedepreciated to Le 7661 per US$. Given Government's concern for the welfare of thepeople, the price of fuel in the retail market, at which we all buy fuel, has remainedunchanged at Le6000 per litre. Government is closely monitoring the situation asthe efforts to keep pump prices unchanged in the midst of increases in internationaloil prices and depreciation in the exchange rate, over which Government has nocontrol, is proving to be challenging.

Risk Mitigating Measures

117. Mr. Speaker, Honourable Members, to mitigate the impact of macroeconomicshocks, Government will continue to implement sound macroeconomic and sectoralpolicies, including a prudent fiscal policy with strong revenue measures as well asproactive monetary policy to ensure a stable macroeconomic environment.

118. To mitigate the impact of contingent liabilities, my Ministry is developing afull set of guidelines for the issuance of loan guarantees as well as a template forfinancial reporting by State-Owned Enterprises and Local Councils. Government,with assistance from the IMF, is in the process of establishing a unit within theMinistry of Finance and Economic Development for fiscal oversight of State-OwnedEnterprises.

119. To mitigate the impact of natural disasters, a contingency allocation isincluded in the Government budget to address effects of natural disasters. In addition,early warning mechanisms will also be adopted to ensure readiness and appropriateaction before the occurrence of a disaster.

120. To mitigate the effect of any re-emergence of Ebola and other healthemergencies, Government is working on strengthening Integrated DiseaseSurveillance Reporting (IDSR) at national and community levels.

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VII. Conclusion

121. Mr. Speaker, Honouble Members, in concluding this statement, let me thankmy colleague Ministers for their invaluable contributions in shaping the policies andmeasures I have just announced. The Minister of State and the Deputy Minister inMoFED, the Financial Secretary and staff of MoFED also deserve commendation.The Governor, Management and staff of the Bank of Sierra Leone are recognized fortheir collaboration and cooperation in the coordination of fiscal and monetary policies.The Commissioner-General, Management and staff of the National Revenue Authorityalso supported this effort.

122. Mr. Speaker, Honourable Members, let me also wholeheartedly thank theChairpersons of the Finance and Transparency Committees of Parliament. OurDevelopment Partners, who continue to support our priority programmes deservespecial appreciation. The District Budget Oversight Committee Members, the Non-State Actors and members of the electronic and print media that participated in ouropen budget discussions, deserve our gratitude. As usual, the Government Printerand staff rose to the occasion and produced the printed Statement and Estimates ontime.

123. Mr Speaker, Honourable Members, as already emphasized, we must increaseour domestic revenue mobilization efforts to finance our development agenda. Thisis especially so in the context of volatile mineral revenues and declining donorsupport. We therefore need to ensure that the policies we have outlined are effectivelyimplemented. We have the tools; the Revenue Mobilization Strategy; the FiscalManagement and Control Act, the 2018 Finance Act; the TSA and other PFM reforms.

124. In the true spirit of transforming the economy, we have to do MORE. We cando MORE and we will do MORE.

125. I, therefore, commend this budget to the House. I thank you all for listeningand may God bless Sierra Leone.

BUDGET PROFILE


GOVERNMENT BUDGET

and

STATEMENT OF ECONOMIC ANDFINANCIAL POLICIES

For the Financial Year, 2018

Theme: “"Strengthening Resilience for Inclusive Growth”

DELIVERED BY

MOMODU L. KARGBOMinister of Finance and Economic Development

in the Chamber of ParliamentTOWER HILL, FREETOWN

ON

Friday, 27th October 2017

at

10:00 a.m.

i

GOVERNMENT OF SIERRA LEONEANNEX 1–BUDGET PROFILE FOR FY2016–2020

In Millions of Leones (Le’m)FY2016 FY2016 FY2017 FY2017 FY2018 FY2018 FY2019 FY2019 FY2020 FY2020

PARTICULARS Actual % of GDP Estimate % of GDP Budget % of GDP Indicative % of GDP Indicative % of GDPQ1 - 4 Q1 - 4 Q1 - 4 Q1 - 4 Q1 - 4

Jan - Dec Jan - Dec Jan - Dec Jan - Dec Jan - Dec

Total Revenue and Grants 3,615,441 15.2% 4,300,052 14.8% 5,214,636 15.2% 6,321,228 16.6% 7,566,211 17.3%Domestic Revenue 2,888,732 12.1% 3,528,042 12.1% 4,556,300 13.3% 5,550,432 14.6% 6,728,415 15.4%

Income Tax Revenue 1,269,208 5.3% 1,262,826 4.3% 1,521,805 4.4% 1,871,498 4.9% 2,349,078 5.4%Corporate Tax 324,479 1.4% 367,659 1.3% 375,400 1.1% 525,560 1.4% 683,228 1.6%Personal Income Tax - incl. Govt PAYE 936,441 3.9% 889,835 3.1% 1,137,900 3.3% 1,342,608 3.5% 1,648,408 3.8%Other Taxes 8,287 0.0% 5,332 0.0% 8,505 0.0% 3,330 0.0% 17,442 0.0%

Goods and Services Tax 666,090 2.8% 826,173 2.8% 1,087,300 3.2% 1,453,982 3.8% 1,748,778 4.0%Import GST 367,839 1.5% 438,049 1.5% 598,700 1.7% 799,258 2.1% 959,110 2.2%Domestic GST 298,252 1.3% 388,124 1.3% 488,600 1.4% 654,724 1.7% 789,669 1.8%

Customs and Excise Department 570,057 2.4% 985,873 3.4% 1,332,700 3.9% 1,207,665 3.2% 1,436,811 3.3%Import Duties 381,633 1.6% 491,161 1.7% 794,300 2.3% 880,879 2.3% 1,073,791 2.5%Excise Duties on Petroleum Products 163,625 0.7% 455,201 1.6% 500,000 1.5% 307,200 0.8% 331,776 0.8%Other Excise Duties 20,031 0.1% 22,911 0.1% 23,300 0.1% 14,213 0.0% 15,350 0.0%Other Revenue - incl. Freight Levy 4,768 0.0% 16,600 0.1% 15,100 0.0% 5,373 0.0% 15,894 0.0%

Mines Department 155,517 0.7% 146,587 0.5% 240,550 0.7% 458,618 1.2% 540,152 1.2%Royalty on Rutile 32,308 0.1% 35,626 0.1% 54,600 0.2% 119,897 0.3% 161,528 0.4%Royalty on Bauxite 7,020 0.0% 12,400 0.0% 19,000 0.1% 45,843 0.1% 55,290 0.1%Royalties on Diamond and Gold 26,510 0.1% 31,196 0.1% 63,700 0.2% 103,579 0.3% 113,627 0.3%Royalty on Iron Ore 32,015 0.1% 22,341 0.1% 50,100 0.1% 80,993 0.2% 90,894 0.2%Licences etc. 57,664 0.2% 45,023 0.2% 53,150 0.2% 108,306 0.3% 118,812 0.3%

Other Departments 138,832 0.6% 191,262 0.7% 245,045 0.7% 425,084 1.1% 500,109 1.1%Royalties etc. on Fisheries 54,651 0.2% 70,000 0.2% 88,000 0.3% 186,537 0.5% 204,632 0.5%Parastatals 0 0.0% 39,109 0.1% 42,900 0.1% 97,062 0.3% 140,265 0.3%Other Revenues 84,181 0.4% 82,153 0.3% 114,145 0.3% 141,486 0.4% 155,211 0.4%

Road User Charges & Vehicle Licences 89,028 0.4% 115,321 0.4% 128,900 0.4% 133,585 0.4% 153,487 0.4%

Grants 726,709 3.1% 772,010 2.7% 658,336 1.9% 770,796 2.0% 837,796 1.9%Programme 201,345 0.8% 310,775 1.1% 264,336 0.8% 401,337 1.1% 486,716 1.1%

o/w Debt Relief Assistance 8,716 0.0% 5,607 0.0% 0 0.0% 0 0.0% 0 0.0%o/w HIPC - $' m $1.34 $0.74 $0.00 $0.00 $0.00o/w Japanese Food and Oil Aid $0.00 0.0% $0.00 0.0% $0.00 0.0% $0.00 0.0% $0.00 0.0%

o/w Global Fund Salary Support 0 0.0% 30,220 0.1% 0 0.0% 0 0.0% 0 0.0%o/w External Donors Budgetary Support /4 192,629 0.8% 274,948 0.9% 264,336 0.8% 401,337 1.1% 486,716 1.1% o/w UK DFID - $' m $3.60 $0.00 $14.27 $14.27 $14.27 o/w EU - $' m $26.43 $16.67 $16.55 $18.85 $20.15

o/w IMF CCR Debt Relief- $'m $0.00 $0.00 $0.00 $0.00 $0.00o/w World Bank - $' m $0.00 $18.00 $0.00 $20.00 $30.00o/w African Dev. Bank - $' m $0.00 $4.23 $4.17 $0.00 $0.00

Elections Basket Fund 0 0.0% 92,000 0.3% 8,000 0.0% 0 0.0% 0 0.0%Support to the 2018 General Elections 0 92,000 8,000 0 0

Project - Other Projects 525,364 2.2% 369,235 1.3% 386,000 1.1% 369,459 1.0% 351,080 0.8%

Total Expenditure and Lending minus Repayments 5,440,651 22.8% 6,178,434 21.2% 7,284,849 21.2% 8,489,407 22.3% 10,039,671 22.9%

Recurrent Expenditure 3,553,254 14.9% 4,097,559 14.1% 4,829,849 14.0% 5,575,407 14.7% 6,516,671 14.9% Wages & Salaries 1,817,527 7.6% 1,825,000 6.3% 2,067,800 6.0% 2,405,712 6.3% 2,778,666 6.3%

o/w: Pensions, Gratuities and Other Allowances 106,393 0.4% 115,645 0.4% 107,530 0.3% 125,102 0.3% 144,497 0.3%o/w: Contributions to Social Security 130,280 0.5% 143,549 0.5% 182,299 0.5% 211,467 0.6% 245,301 0.6%

ii


In Millions of LeonesFY2016 FY2016 FY2017 FY2017 FY2018 FY2018 FY2019 FY2019 FY2020 FY2020



Non-Salary, Non-Interest Recurrent Expenditure 1,533,921 6.4% 1,661,003 5.7% 1,810,050 5.3% 2,059,695 5.4% 2,427,005 5.5%Goods and Services 1,138,550 4.8% 900,274 3.1% 1,203,050 3.5% 1,398,424 3.7% 1,623,731 3.7%

o/w Social and Economic 446,914 1.9% 279,173 1.0% 498,372 1.4% 596,803 1.6% 696,129 1.6%General and Others 390,031 1.6% 309,150 1.1% 442,333 1.3% 488,592 1.3% 563,426 1.3% o/w National Revenue Authority 68,676 0.3% 76,271 0.3% 90,462 0.3% 107,939 0.3% 122,248 0.3%

Statistics - Sierra Leone 8,767 0.0% 8,394 0.0% 7,707 0.0% 9,196 0.0% 10,973 0.0% Defence Expenditure 162,738 0.7% 162,059 0.6% 106,687 0.3% 127,298 0.3% 142,563 0.3%

Police 83,544 0.4% 99,868 0.3% 97,470 0.3% 116,300 0.3% 138,769 0.3%Correctional Services 55,323 0.2% 50,023 0.2% 58,189 0.2% 69,430 0.2% 82,844 0.2%

Transfers to Local Councils 95,703 0.4% 96,236 0.3% 139,907 0.4% 206,973 0.5% 273,078 0.6%Grants for Admin. Expenses 1,643 0.0% 5,525 0.0% 5,936 0.0% 7,920 0.0% 12,568 0.0%Grants for Devolved Functions 94,060 0.4% 90,711 0.3% 133,971 0.4% 199,053 0.5% 260,510 0.6%

Grants to Educational Institutions 178,980 0.8% 186,022 0.6% 206,331 0.6% 259,780 0.7% 251,799 0.6%Transfer to Road Maintenance Fund 92,028 0.4% 115,321 0.4% 128,900 0.4% 133,585 0.4% 153,487 0.4%Foreign Support to Ebola Response (AfDB - US$12.5m) 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0%Mudslides Recovery Expenditure (World Bank - US$10m) 0 0.0% 75,550 0.3% 0 0.0% 0 0.0% 0 0.0%Elections and Democratisation 28,660 0.1% 287,600 1.0% 131,862 0.4% 60,933 0.2% 124,910 0.3%

Domestic contribution 28,660 0.1% 195,600 0.7% 123,862 0.4% 60,933 0.2% 124,910 0.3%National Electoral Commission 28,660 0.1% 195,600 0.7% 123,862 0.4% 60,933 0.2% 124,910 0.3%Foreign contribution 0 0.0% 92,000 0.3% 8,000 0.0% 0 0.0% 0 0.0%

Total interest payments 201,806 0.8% 611,557 2.1% 952,000 2.8% 1,110,000 2.9% 1,311,000 3.0%Domestic Interest 140,753 0.6% 535,131 1.8% 854,000 2.5% 938,000 2.5% 1,056,000 2.4%

Foreign Interest 61,052 0.3% 76,426 0.3% 98,000 0.3% 172,000 0.5% 255,000 0.6%

Capital Expenditure and Net Lending 1,887,397 7.9% 2,080,875 7.1% 2,455,000 7.1% 2,914,000 7.7% 3,523,000 8.0%

Capital Expenditure 2,038,799 8.6% 2,080,875 7.1% 2,455,000 7.1% 2,914,000 7.7% 3,523,000 8.0%Foreign Loans and Grants 1,033,551 4.3% 1,217,535 4.2% 1,409,000 4.1% 1,519,000 4.0% 1,756,000 4.0%

Loans 508,187 2.1% 848,300 2.9% 1,023,000 3.0% 1,149,541 3.0% 1,404,920 3.2% Grants 525,364 2.2% 369,235 1.3% 386,000 1.1% 369,459 1.0% 351,080 0.8%

Domestic 1,005,248 4.2% 863,340 3.0% 1,046,000 3.0% 1,395,000 3.7% 1,767,000 4.0% Lending minus Repayment (151,402) -0.6% 0 0.0% 0 0.0% 0 0.0% 0 0.0%

OVERALL DEFICIT/SURPLUS (-) (+)(on commitment basis) including grants (1,825,210) -7.7% (1,878,382) -6.5% (2,070,214) -6.0% (2,168,179) -5.7% (2,473,460) -5.6%

excluding grants (2,551,919) -10.7% (2,650,392) -9.1% (2,728,549) -7.9% (2,938,975) -7.7% (3,311,256) -7.6% basic primary balance 1/ 2/ (1,316,562) -5.5% (729,300) -2.5% (359,549) -1.0% (309,975) -0.8% (244,256) -0.6%

domestic primary balance (1,536,039) -6.4% (1,295,784) -4.5% (1,362,499) -4.0% (1,451,647) -3.8% (1,547,786) -3.5%

Contingency Expenditure: (78,723) -0.3% (31,352) -0.1% (148,950) -0.4% (203,673) -0.5% (247,531) -0.6%Contingency Fund (78,723) -0.3% (31,352) -0.1% (90,000) -0.3% (101,836) -0.3% (123,765) -0.3%Special Presidential Warrants 0 0.0% 0 0.0% (45,000) -0.1% (50,918) -0.1% (61,883) -0.1%Unallocated Expenditures 0 0.0% 0 0.0% (13,950) 0.0% (50,918) -0.1% (61,883) -0.1%

Change in Arrears: (39,557) -0.2% (20,131) -0.1% (33,908) -0.1% (38,001) -0.1% (44,001) -0.1% Domestic Suppliers (Incl. outstanding commitments

of previous year) (11,374) 0.0% (16,306) -0.1% (30,000) -0.1% (36,000) -0.1% (41,000) -0.1% Govt. Arrears to Parastatals (26,534) -0.1% (2,522) 0.0% (2,000) 0.0% - 0.0% - 0.0% Wages Arrears 3/ (1,649) 0.0% (1,303) 0.0% (1,908) 0.0% (2,001) 0.0% (3,001) 0.0%

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In Millions of LeonesFY2016 FY2016 FY2017 FY2017 FY2018 FY2018 FY2019 FY2019 FY2020 FY2020



OVERALL DEFICIT (CASH BASIS) Including grants (1,943,490) -8.2% (1,929,866) -6.6% (2,253,072) -6.6% (2,409,853) -6.3% (2,764,991) -6.3%

TOTAL FINANCING 1,943,490 8.2% 1,929,866 6.6% 2,253,072 6.6% 2,409,853 6.3% 2,764,991 6.3%

Foreign 375,628 1.6% 759,463 2.6% 908,000 2.6% 1,085,541 2.9% 1,231,920 2.8%Borrowing (Loans) 508,187 2.1% 1,016,720 3.5% 1,194,000 3.5% 1,389,541 3.7% 1,588,920 3.6%

Project 508,187 2.1% 848,300 2.9% 1,023,000 3.0% 1,149,541 3.0% 1,404,920 3.2%Programme 0 0.0% 168,420 0.6% 171,000 0.5% 240,000 0.6% 184,000 0.4%

External Debt Amortisation (132,559) -0.6% (257,257) -0.9% (286,000) -0.8% (304,000) -0.8% (357,000) -0.8%Domestic Financing 2/ 1,131,290 4.7% 1,236,300 4.2% 1,730,153 5.0% 1,324,312 3.5% 1,533,071 3.5%

Bank 993,427 4.2% 1,185,900 4.1% 1,680,153 4.9% 1,187,312 3.1% 1,383,071 3.2%Central Bank 674,950 2.8% 584,900 2.0% 566,982 1.6% 364,061 1.0% 375,721 0.9%

IMF SDR On-lending 284,046 1.2% 228,132 0.8% 0 0.0% 0 0.0% 0 0.0%Ways and Means Advances 168,181 0.7% (40,232) -0.1% 33,000 0.1% 47,000 0.1% 55,000 0.1%Securities 222,723 0.9% 397,000 1.4% 533,982 1.6% 317,061 0.8% 320,721 0.7%

Commercial Banks 318,476 1.3% 601,000 2.1% 1,113,171 3.2% 823,251 2.2% 1,007,350 2.3%Non-Bank 137,863 0.6% 50,400 0.2% 50,000 0.1% 137,000 0.4% 150,000 0.3%

Privatisation and Other Receipts 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0%Float 436,572 1.8% (65,897) -0.2% (385,081) -1.1% 0 0.0% 0 0.0%

o/w: Cheques Payable 243,043 (243,042) 0 0 0 Change in Outstanding Commitments 0 0 0 0 0 Cheques from Previous Year Cleared in

Current Year 0 0 0 0 0 Cheques on Hold at BSL and AGD at end of

period 207,936 (207,936) (385,081) 0 0 Adjustment for Issuance/Redemption of Loans

and Advances 0 0 0 0 0 Unaccounted (14,407) 385,081 (0) (0) 0

Financing Gap - 0.0% - 0.0% - 0.0% - 0.0% - 0.0%

Financing Gap (US$'m) (2.9) 51.3 (0.0) (0.0) 0.0

Memorandum Items: Public Debt Charges 334,364 1.4% 868,814 3.0% 1,238,000 3.6% 1,414,000 3.7% 1,668,000 3.8%

o/w External Debt Payments(incl. HIPC Debt Relief) 193,611 0.8% 333,682 1.1% 384,000 1.1% 476,000 1.3% 612,000 1.4%

External Budgetary Support (excl. HIPC Debt Relief; incl. PBF) 192,629 473,588 435,336 641,337 670,716

Nominal GDP Figure (excluding Iron Ore) 23,826,000 100.0% 29,110,000 100.0% 34,377,000 100.0% 38,004,000 100.0% 43,828,000 100.0%

Poverty Related Expenditure 1,248,452 1,932,972 1,868,000 2,482,000 3,023,000

Exchange Rate Le/US$ 4,953 7,500 7,555 7,555 7,555

1/ Domestic revenue less total expenditure and net lending, excluding interest paymentsand externally financed capital expenditure

2/ Fiscal Targets3/ Wages arrears - this is usual provision made to reduce stock of wage arrears.

iv

ANNEX 2 - EXTERNAL BUDGETARY SUPPORT BY DONOR FOR FY2018 - 2020In Millions of Leones

FY 2018 FY 2018 FY 2018 FY 2018 FY 2018 FY 2019 FY 2020Development Partners Q1 - 4 Q1 Q2 Q3 Q4 Q1 - 4 Q1 -4

Jan - Dec Jan - Mar Apr - Jun Jul - Sep Oct - Dec Jan - Dec Jan - Dec

Total External Budgetary Support 415,436 33,544 160,015 25,083 196,794 401,337 486,716

Department for International Development - UK 107,833 33,544 34,980 25,083 14,226 107,833 107,833Direct Budget Support - US$'m 14.27 4.44 4.63 3.32 1.88 14.27 14.27

European Commission 125,035 - 125,035 - - 142,404 152,233Direct Budget Support - US$'m 16.55 - 16.55 - - 18.85 20.15

World Bank 151,100 - - - 151,100 151,100 226,650IDA Loan - US$'m (Foreign Financing) 20.00 - - - 20.00 20.00 30.00

African Development Bank 31,468 - - - 31,468 - -ADF Grant - US$'m 4.17 - - - 4.17 - -

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ANNEX 3a - NON SALARY, NON INTEREST RECURRENT BUDGETARY ALLOCATIONS FOR FY 2018-2020In Millions of Leones

FY 2018 % of Total FY 2019 % of Total FY 2020 % of TotalBudget Non Int/Sal Indicative Non Int/Sal Indicative Non Int/Sal

Details Allocation Recurr Exp Recurr Exp Recurr Exp

Le’m Le’m Le’m

1 GENERAL SERVICES 526,619.2 27.0% 502,302.8 22.2% 632,006.1 27.9%

105 Ministry of Political and Public Affairs 2,456.5 0.1% 2,931.1 0.1% 3,497.4 0.2%of which: Office of Diaspora Affairs 532.5 0.0% 635.3 0.0% 758.1 0.0%of which: African Peer Review Mechanism (APRM) 592.9 0.0% 707.5 0.0% 844.1 0.0%

106 Office of the Chief of Staff 7,840.1 0.4% 9,354.8 0.4% 11,162.1 0.5%Office of the Director of Administration and Finance 2,813.6 0.1% 3,357.2 0.1% 4,005.8 0.2%

Strategy and Policy Unit 834.1 0.0% 995.2 0.0% 1,187.5 0.1%Millennium Challenge Compact Secretariat 903.0 0.0% 1,077.5 0.0% 1,285.7 0.1%Public Private Partnership Unit 610.7 0.0% 728.7 0.0% 869.5 0.0%Communications Unit 305.4 0.0% 364.3 0.0% 434.7 0.0%Extractive Industry Transparency Initiative Secretariat 729.9 0.0% 870.9 0.0% 1,039.1 0.0%Perfomance Management and Service Delivery Directorate 1,263.9 0.1% 1,508.1 0.1% 1,799.5 0.1%Citizens Stakeholders Committee Secretariat 379.5 0.0% 452.8 0.0% 540.2 0.0%

107 Ministry of Local Government & Rural Development 15,288.4 0.8% 15,242.0 0.7% 15,186.7 0.7%Administrative and Operating Costs 5,634.3 0.3% 3,722.8 0.2% 1,442.0 0.1%

o/w: Dealmagamation of Chiefdom Boundries (For 2018 this includes set-up of new Provincial and Districts Offices) 3,328.0 0.2% 0.0 0.0% 0.0 0.0%

Southern Province, Bo 2,693.9 0.1% 3,214.3 0.1% 3,835.3 0.2%o/w: District Offices (Moyamba, Pujehun, Bonthe) 2,060.6 0.1% 2,458.7 0.1% 2,933.8 0.1%

Eastern Province, Kenema 2,326.3 0.1% 2,775.7 0.1% 3,312.0 0.1%o/w: District Offices (Kono, Kailahun) 1,210.3 0.1% 1,444.1 0.1% 1,723.1 0.1%

Northern Province, Makeni 2,644.2 0.1% 3,155.1 0.1% 3,764.7 0.2%o/w: District Offices (Tonkolili, Koinadugu I, Koinadugu II) 2,011.2 0.1% 2,399.7 0.1% 2,863.3 0.1%

North West Province, Port Loko 1,989.7 0.1% 2,374.1 0.1% 2,832.8 0.1%o/w: District Offices (Kambia, Karene) 1,215.4 0.1% 1,450.2 0.1% 1,730.4 0.1%

108 Sierra Leone Small Arms Commission 903.7 0.0% 1,078.3 0.0% 1,286.7 0.1%

110 Office of the President 36,766.2 1.9% 43,869.3 1.9% 52,344.7 2.3%Office of the Secretary to the President 20,028.9 1.0% 23,898.4 1.1% 28,515.4 1.3%

o/w: Open Government Initiative Secretariat 296.0 0.0% 353.2 0.0% 421.4 0.0% Gender Adviser's Unit 663.2 0.0% 791.3 0.0% 944.2 0.0%

National Assets and Government Property Commission 1,208.7 0.1% 1,442.2 0.1% 1,720.8 0.1%Public Sector Reform Unit (PSRU) 1,147.9 0.1% 1,369.6 0.1% 1,634.3 0.1%Anti-Corruption Commission (ACC) 6,129.1 0.3% 7,313.3 0.3% 8,726.2 0.4%Office of the Ombudsman 1,688.8 0.1% 2,015.0 0.1% 2,404.3 0.1%Independent Media Commission (IMC) 643.0 0.0% 767.2 0.0% 915.5 0.0%Political Parties Registration Commission (PPRC) 2,659.6 0.1% 3,173.5 0.1% 3,786.6 0.2%Law Reform Commission 1,069.3 0.1% 1,275.9 0.1% 1,522.4 0.1%Corporate Affairs Commission 947.9 0.0% 1,131.1 0.0% 1,349.6 0.1%Sierra Leone Insurance Commission 990.6 0.1% 1,182.0 0.1% 1,410.3 0.1%Local Government Service Commission 252.4 0.0% 301.2 0.0% 359.4 0.0%

112 Office of the Vice President 14,431.4 0.7% 17,219.5 0.8% 20,546.2 0.9%

116 Parliament 15,317.4 0.8% 18,276.7 0.8% 21,807.7 1.0%

117 Cabinet Secretariat 2,553.8 0.1% 3,047.2 0.1% 3,635.9 0.2%o/w: Cabinet Oversight and Monitoring Unit 695.5 0.0% 829.9 0.0% 990.2 0.0%

vi

118 The Judiciary 13,874.9 0.7% 16,555.5 0.7% 19,753.9 0.9%

121 Audit Service Sierra Leone 7,297.3 0.4% 8,707.1 0.4% 10,389.3 0.5%

122 Human Resource Management Office 2,968.9 0.2% 3,542.5 0.2% 4,226.9 0.2%

123 Public Service Commission 2,550.1 0.1% 3,042.8 0.1% 3,630.6 0.2%

124 Law Officers' Department 14,866.2 0.8% 17,738.2 0.8% 21,165.2 0.9%Office of the Solicitor General 13,840.4 0.7% 16,514.2 0.7% 19,704.7 0.9%

o/w: Justice Sector Coordinating Office 1,215.6 0.1% 1,450.5 0.1% 1,730.7 0.1%Legal Aid Board 5,345.9 0.3% 6,378.7 0.3% 7,611.1 0.3%

Administrator and Registrar General 1,025.8 0.1% 1,224.0 0.1% 1,460.5 0.1%

125 Local Courts 1,533.5 0.1% 1,829.8 0.1% 2,183.3 0.1%

126 Independent Police Complaints Board 1,065.0 0.1% 1,270.7 0.1% 1,516.2 0.1%

128 Ministry of Foreign Affairs & International Co-operation 38,638.3 2.0% 46,103.0 2.0% 55,009.9 2.4%Administrative and Operating Costs 14,597.3 0.7% 17,417.4 0.8% 20,782.4 0.9%High Commission, London 1,801.0 0.1% 2,148.9 0.1% 2,564.1 0.1%U.N. Delegation 1,650.6 0.1% 1,969.4 0.1% 2,349.9 0.1%High Commission, Abuja 1,268.1 0.1% 1,513.1 0.1% 1,805.4 0.1%Embassy, Monrovia 1,326.1 0.1% 1,582.3 0.1% 1,888.0 0.1%Embassy, Conakry 1,155.7 0.1% 1,379.0 0.1% 1,645.4 0.1%Embassy, Washington 1,327.8 0.1% 1,584.3 0.1% 1,890.4 0.1%Embassy, Moscow 1,130.5 0.1% 1,349.0 0.1% 1,609.6 0.1%Embassy, Addis Ababa 1,324.5 0.1% 1,580.4 0.1% 1,885.8 0.1%Embassy, Beijing 1,155.7 0.1% 1,379.0 0.1% 1,645.4 0.1%High Commission, Banjul 1,098.1 0.1% 1,310.2 0.1% 1,563.3 0.1%Embassy, Brussels 1,032.4 0.1% 1,231.9 0.1% 1,469.9 0.1%Embassy, Saudi Arabia 1,077.9 0.1% 1,286.2 0.1% 1,534.6 0.1%Embassy, Berlin 788.7 0.0% 941.1 0.0% 1,122.9 0.0%Embassy, Iran 1,029.4 0.1% 1,228.3 0.1% 1,465.6 0.1%High Commission, Accra 1,317.9 0.1% 1,572.5 0.1% 1,876.3 0.1%Embassy, Libya 1,002.0 0.1% 1,195.6 0.1% 1,426.6 0.1%Embassy, Dakar 1,128.5 0.1% 1,346.5 0.1% 1,606.6 0.1%Embassy, Dubai 697.4 0.0% 832.2 0.0% 992.9 0.0%Sierra Leone Mission, Geneva 926.3 0.0% 1,105.2 0.0% 1,318.8 0.1%Embassy, Kuwait 1,209.4 0.1% 1,443.0 0.1% 1,721.8 0.1%Embassy, Seoul 592.9 0.0% 707.5 0.0% 844.1 0.0%

129 Ministry of Finance and Economic Development 67,106.6 3.4% 80,922.5 3.6% 86,556.4 3.8%o/w Subscriptions to International Organisations 43,333.5 2.2% 51,705.3 2.3% 51,694.5 2.3%

National Authorising Office 952.4 0.0% 1,136.4 0.1% 1,355.9 0.1% Financial Intelligence Unit 1,904.7 0.1% 2,272.7 0.1% 2,711.8 0.1%

130 National Revenue Authority (NRA) 90,461.9 4.6% 107,938.7 4.8% 122,247.8 5.4%

131 Revenue Appellate Board 1,251.3 0.1% 1,493.0 0.1% 1,781.4 0.1%

132 Accountant General's Department 37,698.8 1.9% 7,933.0 0.4% 9,465.6 0.4%





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133 Ministry of Information and Communication 4,506.1 0.2% 5,376.7 0.2% 6,415.5 0.3% o/w: Attitudinal and Behavioural Change Programme 1,089.8 0.1% 1,300.3 0.1% 1,551.5 0.1% Office of Government Spokesman 495.4 0.0% 591.1 0.0% 705.3 0.0%

134 National Electoral Commission (NEC) 123,862.2 6.3% 60,932.8 2.7% 124,909.6 5.5%

137 National Commission for Democracy 1,896.5 0.1% 2,262.9 0.1% 2,700.1 0.1%

138 Statistics - Sierra Leone 7,707.1 0.4% 9,196.1 0.4% 10,972.7 0.5%

139 National Commission for Privatisation (NCP) 2,711.1 0.1% 3,234.9 0.1% 3,859.8 0.2%

140 Mass Media Services 260.7 0.0% 311.1 0.0% 371.2 0.0%

141 Government Printing Department 3,216.1 0.2% 3,837.4 0.2% 4,578.8 0.2%

142 National Public Procurement Authority (NPPA) 3,563.9 0.2% 4,252.4 0.2% 5,073.9 0.2%

143 Justice and Legal Service Commission 365.7 0.0% 436.3 0.0% 520.6 0.0%

144 Human Rights Commission Sierra Leone 2,520.8 0.1% 3,007.8 0.1% 3,588.9 0.2%

145 Rights to Access Information Commission 1,138.6 0.1% 1,358.6 0.1% 1,621.1 0.1%

2 SECURITY SERVICES 301,699.5 15.5% 359,986.4 15.9% 420,205.1 18.6%

201 Ministry of Defence 106,686.8 5.5% 127,298.1 5.6% 142,562.6 6.3%Rice for Officers and Other Ranks 25,069.0 1.3% 29,912.2 1.3% 35,691.1 1.6%Logistics and Other Operating Costs 81,617.8 4.2% 97,386.0 4.3% 106,871.5 4.7%

o/w: Outstanding Payment for on-going Contracts 44,946.7 2.3% 53,630.2 2.4% 63,991.3 2.8% Drugs and Medical Supplies 13,402.1 0.7% 15,991.3 0.7% 19,080.7 0.8%

203 National Civil Registration Authority 2,714.3 0.1% 3,238.6 0.1% 3,864.3 0.2%

205 Ministry of Internal Affairs 1,356.3 0.1% 1,618.3 0.1% 1,931.0 0.1%Administrative and Operating Costs 1,356.3 0.1% 1,618.3 0.1% 1,931.0 0.1%

206 Sierra Leone Police 97,469.6 5.0% 116,300.3 5.1% 138,769.0 6.1%Administrative and Operating Costs 29,281.0 1.5% 34,937.9 1.5% 41,687.7 1.8%

o/w Fuel and Spares 13,312.0 0.7% 15,883.8 0.7% 18,952.5 0.8%Rice for Officers and Other Ranks 44,595.1 2.3% 53,210.7 2.4% 63,490.7 2.8%Security Hardware and Other Logistics 23,593.6 1.2% 28,151.7 1.2% 33,590.5 1.5%

o/w: Outstanding payment for Vehicles 4,952.1 0.3% 5,908.8 0.3% 7,050.3 0.3%

207 Sierra Leone Correctional Services 58,188.6 3.0% 69,430.4 3.1% 82,844.0 3.7%o/w: Inmates Welfare (Diets, Toiletories, Drugs etc) 45,356.6 2.3% 54,119.3 2.4% 64,574.8 2.9%

Uniforms and Regalia for Correctional Officers 3,047.0 0.2% 3,635.7 0.2% 4,338.1 0.2%Rice for Officers and Other Ranks 5,830.4 0.3% 6,956.8 0.3% 8,300.8 0.4%





viii

208 National Fire Authority 11,734.3 0.6% 14,001.4 0.6% 16,706.4 0.7%Administrative and Operating Costs 1,321.2 0.1% 1,576.4 0.1% 1,881.0 0.1%Improve Delivery of Fire Services 10,413.2 0.5% 12,425.0 0.5% 14,825.4 0.7%

o/w: Fire Engines 7,822.9 0.4% 9,334.2 0.4% 11,137.6 0.5%

209 Central Intelligence & Security Unit 6,975.1 0.4% 8,322.6 0.4% 9,930.5 0.4%

210 Office of National Security 9,433.5 0.5% 11,256.0 0.5% 13,430.6 0.6%Administrative and Operating Costs 4,221.7 0.2% 5,037.3 0.2% 6,010.4 0.3%Coordination of the Security Sector 5,211.9 0.3% 6,218.8 0.3% 7,420.2 0.3%

211 Immigration Department 5,827.6 0.3% 6,953.4 0.3% 8,296.8 0.4%Administrative and Operating Costs 2,866.4 0.1% 3,420.2 0.2% 4,081.0 0.2%Manning of Various Border Immigration Posts 2,961.2 0.2% 3,533.2 0.2% 4,215.8 0.2%

212 National Drugs Law Enforcement Agency 1,313.5 0.1% 1,567.2 0.1% 1,870.0 0.1%

3 SOCIAL SERVICES 541,942.0 27.3% 658,577.9 28.6% 722,710.2 31.3%

301 Ministry of Education, Science and Technology 369,573.7 18.9% 452,908.9 20.0% 482,306.8 21.3%Administrative and Operating Costs 5,951.5 0.3% 7,101.3 0.3% 8,473.3 0.4%Improving Access to and Quality Education 139,473.8 7.1% 166,419.5 7.4% 198,571.0 8.8%

Grants-in-Aid 18,721.2 1.0% 22,338.1 1.0% 26,653.7 1.2%Planning and Development Services 2,346.3 0.1% 2,799.6 0.1% 3,340.5 0.1%Pre-primary and Primary Education 78,009.7 4.0% 93,080.8 4.1% 111,063.5 4.9%

of which: Grants to Handicapped Schools 2,918.6 0.1% 3,482.5 0.2% 4,155.3 0.2%of which: School Feeding Programme (PRP) 73,774.9 3.8% 88,027.9 3.9% 105,034.5 4.6%

Secondary Education 34,588.1 1.8% 41,270.4 1.8% 49,243.6 2.2%of which: Grants in Aid to Government Boarding Schools 14,163.5 0.7% 16,899.8 0.7% 20,164.8 0.9%of which: Examination Fees to WAEC for WASCE 11,649.7 0.6% 13,900.4 0.6% 16,585.9 0.7%of which: Girl Child Programme 6,518.6 0.3% 7,777.9 0.3% 9,280.6 0.4%of which: National Awards Programme 2,043.8 0.1% 2,438.6 0.1% 2,909.7 0.1%

Physical and Health Education 1,144.5 0.1% 1,365.6 0.1% 1,629.4 0.1%Inspectorate Division 1,087.3 0.1% 1,297.3 0.1% 1,547.9 0.1%Non Formal Education 1,430.7 0.1% 1,707.1 0.1% 2,036.9 0.1%Barefoot Solar Technicians Training Centre 2,146.0 0.1% 2,560.7 0.1% 3,055.4 0.1%

Tertiary Education and Technical and Vocational Education and Training 222,288.4 11.4% 277,168.7 12.2% 272,614.5 12.0%Tertiary Education Commission 3,735.9 0.2% 4,457.6 0.2% 5,318.8 0.2%Tuition Fees Subsidies 159,000.3 8.1% 191,658.3 8.5% 194,038.3 8.6%Grants to Tertiary Education 47,330.9 2.4% 68,122.2 3.0% 57,761.0 2.6%Student's Loan Scheme 9,360.1 0.5% 9,516.6 0.4% 11,422.8 0.5%Technical/Vocational Education 2,861.3 0.1% 3,414.0 0.2% 4,073.6 0.2%

Higher Education, Science and Technology 1,451.2 0.1% 1,731.5 0.1% 2,066.0 0.1%Science and Technology Committee 408.8 0.0% 487.8 0.0% 582.0 0.0%

302 Ministry of Sports 7,992.2 0.4% 9,536.2 0.4% 11,378.6 0.5%Administrative and Operating Costs 1,247.3 0.1% 1,488.3 0.1% 1,775.9 0.1%Sports Programmes 6,744.8 0.3% 8,047.9 0.4% 9,602.7 0.4%

o/w: Contributions to Sporting Activities 6,258.0 0.3% 7,467.1 0.3% 8,909.7 0.4%





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303 Ministry of Tourism and Cultural Affairs 4,220.7 0.2% 5,036.1 0.2% 6,009.0 0.3%Administrative and Operating Costs 1,482.3 0.1% 1,768.7 0.1% 2,110.3 0.1%Promoting Local and International Tourism 2,738.4 0.1% 3,267.4 0.1% 3,898.7 0.2%

Culture Division 1,268.7 0.1% 1,513.8 0.1% 1,806.2 0.1%Tourism Division 1,469.7 0.1% 1,753.6 0.1% 2,092.4 0.1%

Review of the Development of Tourism Act, 1990,Tourism Development Master Plan, 1982 967.2 0.0% 1,154.0 0.1% 1,377.0 0.1%

Formulate Ecotourism Master Plan and Action Plan 502.5 0.0% 599.6 0.0% 715.4 0.0%

304 Ministry of Health and Sanitation 107,429.7 5.5% 128,184.6 5.7% 147,949.3 6.5%Administrative and Operating Costs 8,590.9 0.4% 10,250.6 0.5% 12,230.9 0.5%Improving Access and Quality of Basic Health Services 26,446.7 1.4% 31,556.1 1.4% 37,652.5 1.7%

Human Resources Management 5,096.2 0.3% 6,080.8 0.3% 7,255.6 0.3%Primary Health Care Services 12,865.1 0.7% 15,350.6 0.7% 18,316.3 0.8%

of which: Malaria Prevention and Control 6,878.0 0.4% 8,206.8 0.4% 9,792.3 0.4% STI/HIV/AIDS Prevention and Control Programme 3,585.6 0.2% 4,278.4 0.2% 5,104.9 0.2% Tuberculosis and Leprosy Control Programme 1,980.3 0.1% 2,362.9 0.1% 2,819.4 0.1%

Reproductive and Child Health Care Services 8,485.3 0.4% 10,124.7 0.4% 12,080.7 0.5% National School Health Programme 458.6 0.0% 547.2 0.0% 652.9 0.0% Immunization Programme/EPI 5,096.2 0.3% 6,080.8 0.3% 7,255.6 0.3%

Reproductive Health/Family Planning 611.6 0.0% 729.7 0.0% 870.7 0.0%Secondary Health Care Services 1,039.7 0.1% 1,240.5 0.1% 1,480.2 0.1%Tertiary Health Care Services (National & Referral Hospitals) 26,078.8 1.3% 31,117.1 1.4% 32,128.8 1.4%Directorate of Hospitals and Laboratory 1,478.0 0.1% 1,763.5 0.1% 2,104.2 0.1%Support Services 43,795.7 2.2% 52,256.8 2.3% 62,352.6 2.8%

o/w:Procurement of Free Health Care Drugs 26,585.9 1.4% 31,722.2 1.4% 37,850.8 1.7% Procurement of Cost Recovery Drugs and Other Medical Supplies 15,928.4 0.8% 19,005.7 0.8% 22,677.5 1.0%

305 Ministry of Social Welfare, Gender & Children's Affairs 18,194.0 0.9% 21,709.0 1.0% 25,903.1 1.1%Administrative and Operating Costs 2,257.6 0.1% 2,693.7 0.1% 3,214.1 0.1%Social Protection Programmes 11,432.8 0.6% 13,641.6 0.6% 16,277.1 0.7%

Grants to Welfare Institutions 3,124.6 0.2% 3,728.3 0.2% 4,448.6 0.2%Diets for Approved School & Remand Home 1,719.8 0.1% 2,052.1 0.1% 2,448.5 0.1%Social Development Activities 2,336.7 0.1% 2,788.2 0.1% 3,326.8 0.1%Programme for Disabled Persons - Disability Commission 2,891.8 0.1% 3,450.5 0.2% 4,117.1 0.2%Policy Development and Strategic Planning 1,359.9 0.1% 1,622.6 0.1% 1,936.1 0.1%

Gender and Children's Affairs 2,159.2 0.1% 2,576.4 0.1% 3,074.1 0.1%of which: Gender and Children's Programmes 1,439.4 0.1% 1,717.5 0.1% 2,049.4 0.1%

Children's Commission 2,344.4 0.1% 2,797.3 0.1% 3,337.7 0.1%of which: Child Orphans 1,804.5 0.1% 2,153.2 0.1% 2,569.1 0.1%

306 Ministry of Lands, Country Planning and the Environment 4,085.3 0.2% 4,874.6 0.2% 5,816.3 0.3%

307 National Medical Supplies Agency 1,185.9 0.1% 1,415.0 0.1% 1,688.4 0.1%Administrative and Operating Costs 1,185.9 0.1% 1,415.0 0.1% 1,688.4 0.1%

308 National Commission for Social Action 1,791.4 0.1% 2,137.5 0.1% 2,550.4 0.1%

309 Dental and Medical Board 434.6 0.0% 518.6 0.0% 618.8 0.0%

310 Ministry of Youth Affairs 9,558.4 0.5% 11,405.1 0.5% 13,608.5 0.6%Administrative and Operating Costs 2,739.3 0.1% 3,268.5 0.1% 3,899.9 0.2%Policy Coordination of Youth Programmes 1,655.3 0.1% 1,975.2 0.1% 2,356.7 0.1%National Youth Commission 5,163.8 0.3% 6,161.5 0.3% 7,351.8 0.3%





x

311 Health Service Commission 1,223.2 0.1% 1,459.6 0.1% 1,741.5 0.1%

312 Teaching Service Commission 1,471.6 0.1% 1,755.9 0.1% 2,095.2 0.1%

313 National Youth Service 2,655.0 0.1% 3,167.9 0.1% 3,780.0 0.2%

314 National HIV and AIDS Commission 2,940.0 0.2% 3,508.0 0.2% 4,185.7 0.2%

315 Teaching Hospitals Complex Administration 3,040.0 0.2% 3,627.3 0.2% 4,328.1 0.2%

316 Civil Service Training College 800.0 0.0% 954.6 0.0% 1,139.0 0.1%

345 Pharmacy Board Services 5,346.3 0.3% 6,379.1 0.3% 7,611.6 0.3%

4 ECONOMIC SERVICES 291,661.4 15.0% 331,591.0 14.6% 378,705.8 16.6%

401 Ministry of Agriculture, Forestry and Food Security 53,992.0 2.8% 64,423.0 2.8% 66,869.3 3.0%Administrative and Operating Costs 4,091.7 0.2% 4,882.2 0.2% 5,825.4 0.3%

o/w: National Agricultural Training Centre 629.7 0.0% 751.3 0.0% 896.5 0.0%Increasing Agricultural Productivity and Value Added 40,082.3 2.1% 47,826.0 2.1% 47,065.8 2.1%

Production of Export/Cash Crops 2,633.1 0.1% 3,141.8 0.1% 3,748.8 0.2% o/w: Rehabilitation of Existing Plantations 1,908.1 0.1% 2,276.8 0.1% 2,716.7 0.1% Food Security Division 34,415.4 1.8% 41,064.3 1.8% 38,997.7 1.7% o/w: Procurement of Fertilizers 11,723.4 0.6% 13,988.3 0.6% 10,690.8 0.5% Procurement of Seedlings 7,106.2 0.4% 8,479.1 0.4% 7,117.3 0.3% Procurement of Agricultural Tools and Equipment 3,716.4 0.2% 4,434.4 0.2% 5,291.1 0.2% Procurement and Distribution of Agricultual Processing Equipment 6,779.5 0.3% 8,089.3 0.4% 5,652.1 0.2% Emergency Recovery Priority Programme on Agriculture 1,216.6 0.1% 1,451.7 0.1% 1,732.1 0.1% Forestry Conservation Division 1,774.4 0.1% 2,117.3 0.1% 2,526.3 0.1% o/w: Mainstreaming Forestry and Wildlife into Agricultural Practices 636.0 0.0% 758.9 0.0% 905.6 0.0%

Agricultural Engineering/Land and Water Development Division 1,259.3 0.1% 1,502.6 0.1% 1,793.0 0.1% o/w: Rehabilitation of Inland Valley Swamps 530.1 0.0% 632.5 0.0% 754.7 0.0%

Agricultural Extension Services 4,350.4 0.2% 5,190.8 0.2% 6,193.7 0.3%Planning, Evaluation, Monitoring and Statistics Division (PEMSD) 3,377.2 0.2% 4,029.7 0.2% 4,808.2 0.2%

o/w: Collection and Analysis of Agricultural Statistics 1,378.1 0.1% 1,644.3 0.1% 1,962.0 0.1%Livestock Division 2,090.5 0.1% 2,494.3 0.1% 2,976.2 0.1%

o/w: Establishment of District Livestock Clinics 424.1 0.0% 506.0 0.0% 603.8 0.0% Training of Community Animal Health Workers 381.7 0.0% 455.4 0.0% 543.4 0.0% Procurement of Animal Vaccines 317.9 0.0% 379.4 0.0% 452.7 0.0%

402 Ministry of Fisheries and Marine Resources 4,023.9 0.2% 4,801.3 0.2% 5,728.9 0.3%Administrative and Operating Costs 1,301.1 0.1% 1,552.5 0.1% 1,852.5 0.1%Support to Artisanal Fishing 2,201.1 0.1% 2,626.4 0.1% 3,133.8 0.1%

Procurement and Distribution of appropriate Fishing Gears 1,801.2 0.1% 2,149.2 0.1% 2,564.4 0.1%Training on appropriate and sustainable fishing practices 399.9 0.0% 477.2 0.0% 569.4 0.0%

Promote Fish Export Activities 521.6 0.0% 622.4 0.0% 742.6 0.0%Establish and Operationalise Fish Testing Laboratory 521.6 0.0% 622.4 0.0% 742.6 0.0%





xi

403 Ministry of Mines and Mineral Resources 6,079.2 0.3% 7,253.7 0.3% 8,655.1 0.4%Administrative and Operating Costs 1,314.2 0.1% 1,568.1 0.1% 1,871.0 0.1%Mines Division 4,765.0 0.2% 5,685.6 0.3% 6,784.0 0.3%

Review the legal framework for mines and minerals 347.7 0.0% 414.9 0.0% 495.1 0.0%Support to the National Minerals Agency 3,196.9 0.2% 3,814.6 0.2% 4,551.5 0.2%Support to Artisanal Miners and Small Scale Mining Enterpreneurs 1,220.4 0.1% 1,456.1 0.1% 1,737.5 0.1%

404 Ministry of Transport and Aviation 12,789.6 0.7% 19,219.2 0.8% 21,891.0 1.0%Administrative and Operating Costs 1,344.6 0.1% 1,604.3 0.1% 1,914.3 0.1%Payment of outstanding Contracts on Procurement of Government Vehicles 10,977.2 0.6% 17,056.7 0.8% 19,310.7 0.9%Establish and opeationalise a Planning and Policy Unit 467.8 0.0% 558.2 0.0% 666.0 0.0%

405 Ministry of Tourism and Cultural Affairs 8,407.8 0.4% 10,032.2 0.4% 11,970.3 0.5%National Tourist Board 5,545.4 0.3% 6,616.7 0.3% 7,895.1 0.3%

o/w: Development and Implementation of Tourism Marketing Strategy 729.4 0.0% 870.4 0.0% 1,038.5 0.0%Monuments and Relics Commission 2,062.4 0.1% 2,460.9 0.1% 2,936.3 0.1%National and Railway Museums 800.0 0.0% 954.6 0.0% 1,139.0 0.1%

406 Ministry of Energy 5,519.2 0.3% 6,585.4 0.3% 7,857.7 0.3%Administrative and Operating Expenses 4,141.7 0.2% 4,941.9 0.2% 5,896.7 0.3%

o/w Bumbuna Watershed Unit 1,065.0 0.1% 1,270.7 0.1% 1,516.2 0.1%Bare Foot Solar Tecnicians Training Center 1,377.4 0.1% 1,643.5 0.1% 1,961.1 0.1%

407 Ministry of Labour and Social Security 7,988.4 0.4% 9,372.8 0.4% 11,183.6 0.5%Administrative and Operating Costs 1,498.6 0.1% 1,788.1 0.1% 2,133.6 0.1%Strengthening the legal and Institutional Framework for Labour Administration 3,435.7 0.2% 4,099.5 0.2% 4,891.5 0.2%Social Protection Programmes 3,054.1 0.2% 3,485.2 0.2% 4,158.6 0.2%

o/w: Cash Transfers to the Aged and Vulnerable Persons 2,920.9 0.1% 3,485.2 0.2% 4,158.6 0.2%

408 Ministry of Works, Housing and Infrastructure 13,333.9 0.7% 15,909.9 0.7% 18,983.7 0.8%Administrative and Operating Costs 1,430.8 0.1% 1,707.3 0.1% 2,037.1 0.1%Architectural, Design, Construction and Maint, Div. 4,358.2 0.2% 5,200.2 0.2% 6,204.8 0.3%

of which: Repairs and Maintenance of Government Buildings 3,878.5 0.2% 4,627.9 0.2% 5,521.9 0.2%Civil Engineering Works Division 599.6 0.0% 715.4 0.0% 853.6 0.0%Mechanical Division 559.6 0.0% 667.7 0.0% 796.7 0.0%Housing Division 5,838.6 0.3% 6,966.5 0.3% 8,312.5 0.4%

of which: Rent and Rates 5,107.4 0.3% 6,094.1 0.3% 7,271.4 0.3%Works Project Implementation and Monitoring Unit 547.1 0.0% 652.8 0.0% 778.9 0.0%

409 Ministry of Trade and Industry 13,650.4 0.7% 16,287.6 0.7% 19,434.3 0.9%Administrative and Operating Costs 1,282.3 0.1% 1,530.1 0.1% 1,825.7 0.1%Export Development 12,368.1 0.6% 14,757.5 0.7% 17,608.6 0.8%

Sierra Leone Standards Bureau 2,981.5 0.2% 3,557.5 0.2% 4,244.8 0.2% Sierra Leone Investment and Export Promotion Agency 4,556.1 0.2% 5,436.3 0.2% 6,486.6 0.3% Department of Co-operatives 1,637.2 0.1% 1,953.5 0.1% 2,330.9 0.1% Support to Sierra Leone Produce Marketing Company 576.0 0.0% 687.3 0.0% 820.1 0.0% Commodities Monitoring and Marketing Unit 636.6 0.0% 759.6 0.0% 906.4 0.0% Sierra Leone Business Forum 727.7 0.0% 868.2 0.0% 1,036.0 0.0%

Coordination of Doing Business Reforms Unit 561.8 0.0% 670.3 0.0% 799.8 0.0% Industrial Planning and Development 691.2 0.0% 824.7 0.0% 984.1 0.0%

410 National Protected Area Authority 2,155.6 0.2% 2,572.1 0.1% 3,069.0 0.1% o/w: Conservation Trust Fund Agency 773.4 0.1% 922.8 0.0% 1,101.1 0.0%





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0.0%411 Road Maintenance Fund 128,900.0 6.6% 133,585.0 5.9% 153,487.2 6.8%

Road Maintenance Fund Administration 15,395.0 0.8% 18,612.1 0.8% 21,612.1 1.0%Sierra Leone Roads Authority 22,865.7 1.2% 27,644.0 1.2% 33,644.0 1.5%Road Maintenance Activities 90,639.3 4.6% 87,328.9 3.9% 98,231.1 4.3%

412 National Telecommunications Commission (NATCOM) 200.0 0.0% 238.6 0.0% 284.7 0.0%

413 Sierra Leone Electricity and Water Regulatory Commission 1,367.1 0.1% 1,631.3 0.1% 1,946.4 0.1%

414 Ministry of Water Resources 14,727.7 0.8% 17,573.0 0.8% 20,968.0 0.9%Administrative and Operating Costs 1,341.5 0.1% 1,600.6 0.1% 1,909.9 0.1%Water Directorate 12,336.2 0.6% 14,719.4 0.7% 17,563.2 0.8%

o/w: Grants to SALWACO 9,344.5 0.5% 11,149.8 0.5% 13,303.8 0.6% o/w: Emergency Recovery Priority Programmes on Water 1,595.5 0.1% 1,903.8 0.1% 2,271.6 0.1%

Water Resources Management Unit 498.6 0.0% 595.0 0.0% 709.9 0.0%National Water Resources Management Agency 551.4 0.0% 657.9 0.0% 785.0 0.0%

415 Sierra Leone Maritime Administration (SLMA) 1,800.0 0.1% 2,147.8 0.1% 2,562.7 0.1%

416 Civil Aviation Authority 2,034.3 0.1% 2,427.3 0.1% 2,896.2 0.1%

417 Nuclear Safety and Radiation Protection Authority 2,104.8 0.1% 2,511.5 0.1% 2,996.7 0.1%

418 Sierra Leone Agricultural Research Institute (SLARI) 5,725.1 0.3% 6,831.1 0.3% 8,150.9 0.4%

419 Local Content Agency 798.7 0.0% 953.0 0.0% 1,137.1 0.1%

420 Sierra Leone Environment Protection Agency (SLEPA) 400.0 0.0% 477.3 0.0% 569.5 0.0%

421 Small and Medium Enterprises Development Agency (SMEDA) 4,350.0 0.2% 5,190.4 0.2% 6,193.2 0.3%

422 Sierra Leone Meteorological Agency 1,313.7 0.1% 1,567.5 0.1% 1,870.3

5 MISCELLANEOUS SERVICES 221.3 0.0% 264.1 0.0% 300.1 0.0%

Miscellaneous Services 221.3 0.0% 264.1 0.0% 300.1 0.0%

501001 Miscellaneous Services - Secretary to the President 0.0 0.0% 0.0 0.0% 0.0 0.0%501002 Miscellaneous Services - General 0.0 0.0% 0.0 0.0% 0.0 0.0%501003 Miscellaneous Services - Accountant-General's Office 221.3 0.0% 264.1 0.0% 300.1 0.0%

6 CONTINGENCY EXPENDITURE 148,950.0 13.8% 203,672.6 9.0% 247,530.5 10.9%Contingency Fund 90,000.0 4.6% 101,836.3 4.5% 123,765.3 5.5%Special Presidential Warrants 45,000.0 2.3% 50,918.1 2.2% 61,882.6 2.7%Unallocated Expenditures 13,950.0 0.7% 50,918.1 2.2% 61,882.6 2.7%





xiii

7 TRANSFERS TO LOCAL COUNCILS 139,906.5 13.0% 206,972.9 9.1% 273,078.0 12.1%Grants for General Administrative Expenses 5,935.9 0.3% 7,920.2 0.3% 12,567.8 0.6%

Local Government Grants 5,935.9 0.3% 7,920.2 0.3% 12,567.8 0.6%Grants for Devolved Functions 133,970.6 6.9% 199,052.7 8.8% 260,510.2 11.5%

Sensitisation on Fire Prevention Services 939.9 0.0% 1,254.1 0.1% 1,673.3 0.1%Education Services 62,200.2 3.2% 98,290.5 4.3% 117,736.1 5.2%

Administration 4,271.4 0.2% 5,699.3 0.3% 7,604.4 0.3% Pre-primary and Primary Education 37,115.8 1.9% 59,820.8 2.6% 70,077.9 3.1% of which: Examination Fees to WAEC for NPSE 5,877.2 0.3% 7,841.9 0.3% 10,463.3 0.5% of which: Govt. and Govt. Assisted Schools 31,238.6 1.6% 51,978.9 2.3% 59,614.7 2.6%

School Fees Subsidy 23,647.6 1.2% 41,850.3 1.8% 42,100.3 1.9% Textbooks 4,303.6 0.2% 5,742.2 0.3% 7,661.8 0.3% Teaching and Learning Materials 3,287.4 0.2% 4,386.3 0.2% 9,852.6 0.4%

Secondary Education 13,265.0 0.7% 22,699.3 1.0% 26,615.9 1.2% of which: Examination Fees to WAEC for BECE 9,014.2 0.5% 17,027.5 0.8% 16,048.1 0.7% of which: Textbooks 2,769.9 0.1% 3,695.8 0.2% 7,931.3 0.4% of which: Science Equipments 1,480.9 0.1% 1,975.9 0.1% 2,636.5 0.1% Government Libraries 3,144.6 0.2% 4,195.8 0.2% 5,598.4 0.2% Education Development 4,403.4 0.2% 5,875.4 0.3% 7,839.4 0.3%

Youths and Sports Services 2,083.3 0.1% 2,779.7 0.1% 3,708.9 0.2% Sports Equipment 1,216.9 0.1% 1,623.7 0.1% 2,166.5 0.1%

Youths Division 866.4 0.0% 1,156.0 0.1% 1,542.5 0.1%Solid Waste Management Services 6,849.0 0.4% 9,138.5 0.4% 12,193.4 0.5%Health Care Services 30,396.8 1.6% 45,558.0 2.0% 69,116.0 3.1%

District Peripheral Health Care Services (PHCs) 15,460.9 0.8% 20,629.3 0.9% 37,525.3 1.7% Secondary Health Services (District Hospitals except, Bo, Kenema & Makeni) 14,935.9 0.8% 24,928.8 1.1% 31,590.7 1.4%

Social Welfare, Gender and Children's Affairs 4,137.2 0.2% 5,520.2 0.2% 7,365.5 0.3% Social Welfare Division 1,850.7 0.1% 2,469.4 0.1% 3,294.8 0.1% Gender and Children's Affairs Division 2,286.5 0.1% 3,050.8 0.1% 4,070.7 0.2%

Agriculture and Food Security Services 23,668.6 1.2% 31,580.7 1.4% 42,137.6 1.9%Fisheries and Marine Resources 582.0 0.0% 776.6 0.0% 1,036.1 0.0%Water services 3,113.6 0.2% 4,154.4 0.2% 5,543.2 0.2%

Rural Water Services 3,113.6 0.2% 4,154.4 0.2% 5,543.2 0.2%

Total Non Salary, Non Interest Recurrent Expenditure Provisions 1,950,999.9 100.0% 2,263,367.8 100.0% 2,674,535.9 118.2% Goods & Services 1,203,050.0 61.7% 1,398,424.0 61.8% 1,623,731.3 71.7%

Social and Economic 498,372.3 25.5% 596,803.5 26.4% 696,129.5 30.8%General and Others 442,332.8 22.7% 488,591.7 21.6% 563,426.2 24.9%

o/w National Revenue Authority 90,461.9 4.6% 107,938.7 4.8% 122,247.8 5.4% Statistics - Sierra Leone 7,707.1 0.4% 9,196.1 0.4% 10,972.7 0.5%

Defence Expenditure 106,686.8 5.5% 127,298.1 5.6% 142,562.6 6.3%Police 97,469.6 5.0% 116,300.3 5.1% 138,769.0 6.1%Correctional Services 58,188.6 3.0% 69,430.4 3.1% 82,844.0 3.7%

Transfers to Local Councils 139,906.5 7.2% 206,972.9 9.1% 273,078.0 12.1%Grants for Admin. Expenses 5,935.9 0.3% 7,920.2 0.3% 12,567.8 0.6%Grants for Devolved Functions 133,970.6 6.9% 199,052.7 8.8% 260,510.2 11.5%

Grants to Educational Institutions 206,331.2 10.6% 259,780.5 11.5% 251,799.3 11.1% Transfer to Road Fund 128,900.0 6.6% 133,585.0 5.9% 153,487.2 6.8% Elections and Democratisation - National Electoral Commission 123,862.2 6.3% 60,932.8 2.7% 124,909.6 5.5% Contingency Expenditure 148,950.0 7.6% 203,672.6 9.0% 247,530.5 10.9%





xiv

A SECTOR MINISTRIES 870,723.4 82.6% 1,052,529.4 85.9% 1,159,444.2 107.8%

1 PUBLIC ADMINISTRATION SECTOR 112,707.6 50.5% 135,333.4 37.5% 151,479.2 47.3%

105 Ministry of Political and Public Affairs 2,456.5 0.2% 2,931.1 0.2% 3,497.4 0.3%of which: Office of Diaspora Affairs 532.5 0.1% 635.3 0.0% 758.1 0.1%of which: African Peer Review Mechanism (APRM) 592.9 0.1% 707.5 0.1% 844.1 0.1%

128 Ministry of Foreign Affairs & International Co-operation 38,638.3 3.8% 46,103.0 3.5% 55,009.9 4.2%Administrative and Operating Costs 14,597.3 1.4% 17,417.4 1.3% 20,782.4 1.6%High Commission, London 1,801.0 0.2% 2,148.9 0.2% 2,564.1 0.2%U.N. Delegation 1,650.6 0.2% 1,969.4 0.2% 2,349.9 0.2%High Commission, Abuja 1,268.1 0.1% 1,513.1 0.1% 1,805.4 0.1%Embassy, Monrovia 1,326.1 0.1% 1,582.3 0.1% 1,888.0 0.1%Embassy, Conakry 1,155.7 0.1% 1,379.0 0.1% 1,645.4 0.1%Embassy, Washington 1,327.8 0.1% 1,584.3 0.1% 1,890.4 0.1%Embassy, Moscow 1,130.5 0.1% 1,349.0 0.1% 1,609.6 0.1%Embassy, Addis Ababa 1,324.5 0.1% 1,580.4 0.1% 1,885.8 0.1%Embassy, Beijing 1,155.7 0.1% 1,379.0 0.1% 1,645.4 0.1%High Commission, Banjul 1,098.1 0.1% 1,310.2 0.1% 1,563.3 0.1%Embassy, Brussels 1,032.4 0.1% 1,231.9 0.1% 1,469.9 0.1%Embassy, Saudi Arabia 1,077.9 0.1% 1,286.2 0.1% 1,534.6 0.1%Embassy, Berlin 788.7 0.1% 941.1 0.1% 1,122.9 0.1%Embassy, Iran 1,029.4 0.1% 1,228.3 0.1% 1,465.6 0.1%High Commission, Accra 1,317.9 0.1% 1,572.5 0.1% 1,876.3 0.1%Embassy, Libya 1,002.0 0.1% 1,195.6 0.1% 1,426.6 0.1%Embassy, Dakar 1,128.5 0.1% 1,346.5 0.1% 1,606.6 0.1%Embassy, Dubai 697.4 0.1% 832.2 0.1% 992.9 0.1%Sierra Leone Mission, Geneva 926.3 0.1% 1,105.2 0.1% 1,318.8 0.1%Embassy, Kuwait 1,209.4 0.1% 1,443.0 0.1% 1,721.8 0.1%Embassy, Seoul 592.9 0.1% 707.5 0.1% 844.1 0.1%

129 Ministry of Finance and Economic Development 67,106.6 6.5% 80,922.5 6.2% 86,556.4 6.6%o/w Subscriptions to International Organisations 43,333.5 4.2% 51,705.3 3.9% 51,694.5 3.9%

National Authorising Office 952.4 0.1% 1,136.4 0.1% 1,355.9 0.1%Financial Intelligence Unit 1,904.7 0.2% 2,272.7 0.2% 2,711.8 0.2%

133 Ministry of Information and Communication 4,506.1 0.4% 5,376.7 0.4% 6,415.5 0.5%o/w: Attitudinal and Behavioural Change Programme 1,089.8 0.1% 1,300.3 0.1% 1,551.5 0.1%

Office of Government Spokesman 495.4 0.0% 591.1 0.0% 705.3 0.1%

2 GROWTH SECTOR 76,803.3 0.0% 91,641.4 7.0% 99,346.1 7.6%

303 Ministry of Tourism and Cultural Affairs 4,220.7 0.4% 5,036.1 0.4% 6,009.0 0.5%Administrative and Operating Costs 1,482.3 0.1% 1,768.7 0.1% 2,110.3 0.2%Promoting Local and International Tourism 2,738.4 0.3% 3,267.4 0.2% 3,898.7 0.3%

Culture Division 1,268.7 0.1% 1,513.8 0.1% 1,806.2 0.1%Tourism Division 1,469.7 0.1% 1,753.6 0.1% 2,092.4 0.2%

Review of the Development of Tourism Act, 1990,Tourism Development 967.2 0.1% 1,154.0 0.1% 1,377.0 0.1%

Formulate Ecotourism Master Plan and Action Plan 502.5 0.0% 599.6 0.0% 715.4 0.1%

ANNEX 3b - SECTORAL ALLOCATION OF NON SALARY, NON INTEREST REURRENT EXPENDITURES FOR 2018-2020In Millions of Leones


Details Le’m Recurr Exp Recurr Exp Recurr Exp


xv

306 Ministry of Lands, Country Planning and the Environment 4,085.3 0.4% 4,874.6 0.4% 5,816.3 0.4%

401 Ministry of Agriculture, Forestry and Food Security 53,992.0 5.3% 64,423.0 4.9% 66,869.3 5.1%Administrative and Operating Costs 4,091.7 0.4% 4,882.2 0.4% 5,825.4 0.4%

o/w: National Agricultural Training Centre 629.7 0.1% 751.3 0.1% 896.5 0.1%Increasing Agricultural Productivity and Value Added 40,082.3 3.9% 47,826.0 3.6% 47,065.8 3.6%

Production of Export/Cash Crops 2,633.1 0.3% 3,141.8 0.2% 3,748.8 0.3%o/w: Rehabilitation of Existing Plantations 1,908.1 0.2% 2,276.8 0.2% 2,716.7 0.2%

Food Security Division 34,415.4 3.4% 41,064.3 3.1% 38,997.7 3.0%o/w: Procurement of Fertilizers 11,723.4 1.1% 13,988.3 1.1% 10,690.8 0.8%

Procurement of Seedlings 7,106.2 0.7% 8,479.1 0.6% 7,117.3 0.5%Procurement of Agricultural Tools and Equipment 3,716.4 0.4% 4,434.4 0.3% 5,291.1 0.4%Procurement and Distribution of Agricultual Processing Equipment 6,779.5 0.7% 8,089.3 0.6% 5,652.1 0.4%Post-Ebola Recovery Priority Programme on Agriculture 1,216.6 0.1% 1,451.7 0.1% 1,732.1 0.1%

Forestry Conservation Division 1,774.4 0.2% 2,117.3 0.2% 2,526.3 0.2%o/w: Mainstreaming Forestry and Wildlife into Agricultural Practices 636.0 0.1% 758.9 0.1% 905.6 0.1%

Agricultural Engineering/Land and Water Development Division 1,259.3 0.1% 1,502.6 0.1% 1,793.0 0.1%o/w: Rehabilitation of Inland Valley Swamps 530.1 0.1% 632.5 0.0% 754.7 0.1%

Agricultural Extension Services 4,350.4 0.4% 5,190.8 0.4% 6,193.7 0.5%Planning, Evaluation, Monitoring and Statistics Division (PEMSD) 3,377.2 0.3% 4,029.7 0.3% 4,808.2 0.4%

o/w: Collection and Analysis of Agricultural Statistics 1,378.1 0.1% 1,644.3 0.1% 1,962.0 0.1%Livestock Division 2,090.5 0.2% 2,494.3 0.2% 2,976.2 0.2%

o/w: Establishment of District Livestock Clinics 424.1 0.0% 506.0 0.0% 603.8 0.0%Training of Community Animal Health Workers 381.7 0.0% 455.4 0.0% 543.4 0.0%Procurement of Animal Vaccines 317.9 0.0% 379.4 0.0% 452.7 0.0%

402 Ministry of Fisheries and Marine Resources 4,023.9 0.4% 4,801.3 0.4% 5,728.9 0.4%Administrative and Operating Costs 1,301.1 0.1% 1,552.5 0.1% 1,852.5 0.1%Support to Artisanal Fishing 2,201.1 0.2% 2,626.4 0.2% 3,133.8 0.2%

Procurement and Distribution of appropriate Fishing Gears 1,801.2 0.2% 2,149.2 0.2% 2,564.4 0.2%Training on appropriate and sustainable fishing practices 399.9 0.0% 477.2 0.0% 569.4 0.0%

Promote Fish Export Activities 521.6 0.1% 622.4 0.0% 742.6 0.1%Establish and Operationalise Fish Testing Laboratory 521.6 0.1% 622.4 0.0% 742.6 0.1%

403 Ministry of Mines and Mineral Resources 2,882.3 0.3% 3,439.1 0.3% 4,103.6 0.3%Administrative and Operating Costs 1,314.2 0.1% 1,568.1 0.1% 1,871.0 0.1%Mines Division 1,568.1 0.2% 1,871.1 0.1% 2,232.5 0.2%

Review the legal framework for mines and minerals 347.7 0.0% 414.9 0.0% 495.1 0.0%Support to Artisanal Miners and Small Scale Mining Enterpreneurs 1,220.4 0.1% 1,456.1 0.1% 1,737.5 0.1%

405 Ministry of Tourism and Cultural Affairs 2,062.4 0.2% 2,460.9 0.2% 2,936.3 0.2%Monuments and Relics Commission 2,062.4 0.2% 2,460.9 0.2% 2,936.3 0.2%

409 Ministry of Trade and Industry 5,536.8 0.5% 6,606.4 0.5% 7,882.8 0.6%Administrative and Operating Costs 1,282.3 0.1% 1,530.1 0.1% 1,825.7 0.1%Export Development 4,254.4 1.2% 5,076.4 1.1% 6,057.1 1.4%

Department of Co-operatives 1,637.2 0.2% 1,953.5 0.1% 2,330.9 0.2%Commodities Monitoring and Marketing Unit 636.6 0.1% 759.6 0.1% 906.4 0.1%Sierra Leone Business Forum 727.7 0.1% 868.2 0.1% 1,036.0 0.1%Coordination of Doing Business Reforms Unit 561.8 0.1% 670.3 0.1% 799.8 0.1%Industrial Planning and Development 691.2 0.1% 824.7 0.1% 984.1 0.1%Small and Medium Enterprises Development Agency (SMEDA) 0.0 0.0% 0.0 0.0% 0.0 0.0%





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3 SOCIAL SERVICES AND HUMAN DEVELOPMENT SECTOR 515,572.6 51.2% 626,955.2 48.7% 684,978.1 53.3%

301 Ministry of Education, Science and Technology 369,573.7 36.1% 452,908.9 34.6% 482,306.8 36.8%Administrative and Operating Costs 5,951.5 0.6% 7,101.3 0.5% 8,473.3 0.6%Improving Access to and Quality Education 139,473.8 13.6% 166,419.5 12.7% 198,571.0 15.2%

Grants-in-Aid 18,721.2 1.8% 22,338.1 1.7% 26,653.7 2.0%Planning and Development Services 2,346.3 0.2% 2,799.6 0.2% 3,340.5 0.3%Pre-primary and Primary Education 78,009.7 7.6% 93,080.8 7.1% 111,063.5 8.5%

of which: Grants to Handicapped Schools 2,918.6 0.3% 3,482.5 0.3% 4,155.3 0.3%of which: School Feeding Programme (PRP) 73,774.9 7.2% 88,027.9 6.7% 105,034.5 8.0%

Secondary Education 34,588.1 3.4% 41,270.4 3.1% 49,243.6 3.8%of which: Grants in Aid to Government Boarding Schools 14,163.5 1.4% 16,899.8 1.3% 20,164.8 1.5%of which: Examination Fees to WAEC for WASCE 11,649.7 1.1% 13,900.4 1.1% 16,585.9 1.3%of which: Girl Child Programme 6,518.6 0.6% 7,777.9 0.6% 9,280.6 0.7%of which: National Awards Programme 2,043.8 0.2% 2,438.6 0.2% 2,909.7 0.2%

Physical and Health Education 1,144.5 0.1% 1,365.6 0.1% 1,629.4 0.1%Inspectorate Division 1,087.3 0.1% 1,297.3 0.1% 1,547.9 0.1%Non Formal Education 1,430.7 0.1% 1,707.1 0.1% 2,036.9 0.2%Barefoot Solar Technicians Training Centre 2,146.0 0.2% 2,560.7 0.2% 3,055.4 0.2%

Tertiary Education and Technical and Vocational Education and Training 222,288.4 21.7% 277,168.7 21.2% 272,614.5 20.8%Tertiary Education Commission 3,735.9 0.4% 4,457.6 0.3% 5,318.8 0.4%Tuition Fees Subsidies 159,000.3 15.5% 191,658.3 14.6% 194,038.3 14.8%Grants to Tertiary Education 47,330.9 4.6% 68,122.2 5.2% 57,761.0 4.4%Student's Loan Scheme 9,360.1 0.9% 9,516.6 0.7% 11,422.8 0.9%Technical/Vocational Education 2,861.3 0.3% 3,414.0 0.3% 4,073.6 0.3%

Higher Education, Science and Technology 1,451.2 0.1% 1,731.5 0.1% 2,066.0 0.2%Science and Technology Committee 408.8 0.0% 487.8 0.0% 582.0 0.0%

302 Ministry of Sports 7,992.2 0.8% 9,536.2 0.7% 11,378.6 0.9%Administrative and Operating Costs 1,247.3 0.1% 1,488.3 0.1% 1,775.9 0.1%Sports Programmes 6,744.8 0.7% 8,047.9 0.6% 9,602.7 0.7%

o/w: Contributions to Sporting Activities 6,258.0 0.6% 7,467.1 0.6% 8,909.7 0.7%

304 Ministry of Health and Sanitation 107,429.7 10.5% 128,184.6 9.8% 147,949.3 11.3%Administrative and Operating Costs 8,590.9 0.8% 10,250.6 0.8% 12,230.9 0.9%Improving Access and Quality of Basic Health Services 26,446.7 2.6% 31,556.1 2.4% 37,652.5 2.9%

Human Resources Management 5,096.2 0.5% 6,080.8 0.5% 7,255.6 0.6%Primary Health Care Services 12,865.1 1.3% 15,350.6 1.2% 18,316.3 1.4%

of which: Malaria Prevention and Control 6,878.0 0.7% 8,206.8 0.6% 9,792.3 0.7%STI/HIV/AIDS Prevention and Control Programme 3,585.6 0.3% 4,278.4 0.3% 5,104.9 0.4%Tuberculosis and Leprosy Control Programme 1,980.3 0.2% 2,362.9 0.2% 2,819.4 0.2%

Reproductive and Child Health Care Services 8,485.3 0.8% 10,124.7 0.8% 12,080.7 0.9%of which: Free Health Care Programme 0.0 0.0% 0.0 0.0% 0.0 0.0%

National School Health Programme 458.6 0.0% 547.2 0.0% 652.9 0.0%Immunization Programme/EPI 5,096.2 0.5% 6,080.8 0.5% 7,255.6 0.6%Reproductive Health/Family Planning 611.6 0.1% 729.7 0.1% 870.7 0.1%

Secondary Health Care Services 1,039.7 0.1% 1,240.5 0.1% 1,480.2 0.1%Tertiary Health Care Services (National & Referral Hospitals) 26,078.8 2.5% 31,117.1 2.4% 32,128.8 2.5%Directorate of Hospitals and Laboratory 1,478.0 0.1% 1,763.5 0.1% 2,104.2 0.2%Support Services 43,795.7 4.3% 52,256.8 4.0% 62,352.6 4.8%

o/w:Procurement of Free Health Care Drugs 26,585.9 2.6% 31,722.2 2.4% 37,850.8 2.9%Procurement of Cost Recovery Drugs and Other Medical Supplies 15,928.4 1.6% 19,005.7 1.5% 22,677.5 1.7%





xvii

305 Ministry of Social Welfare, Gender & Children's Affairs 18,194.0 1.8% 21,709.0 1.7% 25,903.1 2.0%Administrative and Operating Costs 2,257.6 0.2% 2,693.7 0.2% 3,214.1 0.2%Social Protection Programmes 11,432.8 1.1% 13,641.6 1.0% 16,277.1 1.2%

Grants to Welfare Institutions 3,124.6 0.3% 3,728.3 0.3% 4,448.6 0.3%Diets for Approved School & Remand Home 1,719.8 0.2% 2,052.1 0.2% 2,448.5 0.2%Social Development Activities 2,336.7 0.2% 2,788.2 0.2% 3,326.8 0.3%Programme for Disabled Persons - Disability Commission 2,891.8 0.3% 3,450.5 0.3% 4,117.1 0.3%Policy Development and Strategic Planning 1,359.9 0.1% 1,622.6 0.1% 1,936.1 0.1%

Gender and Children's Affairs 2,159.2 0.2% 2,576.4 0.2% 3,074.1 0.2%of which: Gender and Children's Programmes 1,439.4 0.1% 1,717.5 0.1% 2,049.4 0.2%

Children's Commission 2,344.4 0.2% 2,797.3 0.2% 3,337.7 0.3%of which: Child Orphans 1,804.5 0.2% 2,153.2 0.2% 2,569.1 0.2%

310 Ministry of Youth Affairs 4,394.6 0.4% 5,243.6 0.4% 6,256.7 0.5%Administrative and Operating Costs 2,739.3 0.3% 3,268.5 0.2% 3,899.9 0.3%Policy Coordination of Youth Programmes 1,655.3 0.2% 1,975.2 0.2% 2,356.7 0.2%

407 Ministry of Labour and Social Security 7,988.4 0.8% 9,372.8 0.7% 11,183.6 0.9%Administrative and Operating Costs 1,498.6 0.1% 1,788.1 0.1% 2,133.6 0.2%Strengthening the legal and Institutional Framework for Labour Administration 3,435.7 0.3% 4,099.5 0.3% 4,891.5 0.4%Social Protection Programmes 3,054.1 0.3% 3,485.2 0.3% 4,158.6 0.3%

o/w: Cash Transfers to the Aged and Vulnerable Persons 2,920.9 0.3% 3,485.2 0.3% 4,158.6 0.3%

4 PHYSICAL INFRASTRUCTURE AND ENERGY SECTOR 34,003.8 25.5% 44,531.9 22.6% 52,137.2 25.7%

404 Ministry of Transport and Aviation 12,759.2 1.2% 19,183.0 1.5% 21,891.0 1.7%Administrative and Operating Costs 1,314.2 0.1% 1,568.1 0.1% 1,914.3 0.1%Payment of outstanding Contracts on Procurement of Government Vehicles 10,977.2 1.1% 17,056.7 1.3% 19,310.7 1.5%Establish and opeationalise a Planning and Policy Unit 467.8 0.0% 558.2 0.0% 666.0 0.1%Meteorological Department 0.0 0.0% 0.0 0.0% 0.0 0.0%

406 Ministry of Energy 5,519.2 0.5% 6,585.4 0.5% 7,857.7 0.6%Administrative and Operating Expenses 4,141.7 0.4% 4,941.9 0.4% 5,896.7 0.4%

o/w Bumbuna Watershed Unit 1,065.0 80.6% 1,270.7 80.6% 1,516.2 96.2%Bare Foot Solar Tecnicians Training Center 1,377.4 0.1% 1,643.5 0.1% 1,961.1 0.1%

408 Ministry of Works, Housing and Infrastructure 13,333.9 1.3% 15,909.9 1.2% 18,983.7 1.4%Administrative and Operating Costs 1,430.8 0.1% 1,707.3 0.1% 2,037.1 0.2%Architectural, Design, Construction and Maint, Div. 4,358.2 0.4% 5,200.2 0.4% 6,204.8 0.5%

of which: Repairs and Maintenance of Government Buildings 3,878.5 0.4% 4,627.9 0.4% 5,521.9 0.4%Civil Engineering Works Division 599.6 0.1% 715.4 0.1% 853.6 0.1%Mechanical Division 559.6 0.1% 667.7 0.1% 796.7 0.1%Housing Division 5,838.6 0.6% 6,966.5 0.5% 8,312.5 0.6%

of which: Rent and Rates 5,107.4 0.5% 6,094.1 0.5% 7,271.4 0.6%Works Project Implementation and Monitoring Unit 547.1 0.1% 652.8 0.0% 778.9 0.1%

414 Ministry of Water Resources 2,391.5 1.4% 2,853.5 1.3% 3,404.8 1.6%Administrative and Operating Costs 1,341.5 0.1% 1,600.6 0.1% 1,909.9 0.1%Water Resources Management Unit 498.6 0.0% 595.0 0.0% 709.9 0.1%National Water Resources Management Agency 551.4 0.1% 657.9 0.1% 785.0 0.1%





xviii

5 GOVERNANCE, JUSTICE AND SECURITY SECTOR 131,636.1 29.4% 154,067.5 27.5% 171,503.7 32.1%

107 Ministry of Local Government & Rural Development 15,288.4 1.5% 15,242.0 1.2% 15,186.7 1.2%Administrative and Operating Costs 5,634.3 0.5% 3,722.8 0.3% 1,442.0 0.1%

o/w: Dealmagamation of Chiefdom Boundries (For 2018 this includesset-up of new Provincial and Districts Offices) 3,328.0 0.3% 0.0 0.0% 0.0 0.0%Southern Province, Bo 2,693.9 0.3% 3,214.3 0.2% 3,835.3 0.3%

o/w: District Offices (Moyamba, Pujehun, Bonthe) 2,060.6 0.2% 2,458.7 0.2% 2,933.8 0.2%Eastern Province, Kenema 2,326.3 0.2% 2,775.7 0.2% 3,312.0 0.3%

o/w: District Offices (Kono, Kailahun) 1,210.3 0.1% 1,444.1 0.1% 1,723.1 0.1%Northern Province, Makeni 2,644.2 0.3% 3,155.1 0.2% 3,764.7 0.3%

o/w: District Offices (Tonkolili, Koinadugu I, Koinadugu II) 2,011.2 0.2% 2,399.7 0.2% 2,863.3 0.2%North West Province, Port Loko 1,989.7 0.2% 2,374.1 0.2% 2,832.8 0.2%

o/w: District Offices (Kambia, Karene) 1,215.4 0.1% 1,450.2 0.1% 1,730.4 0.1%

124 Attorney General, Ministry of Justice 8,304.6 0.8% 9,909.1 0.8% 11,823.5 0.9%Office of the Solicitor General 7,278.8 0.7% 8,685.1 0.7% 10,363.0 0.8%Administrator and Registrar General 1,025.8 0.1% 1,224.0 0.1% 1,460.5 0.1%

201 Ministry of Defence 106,686.8 10.4% 127,298.1 9.7% 142,562.6 10.9%Rice for Officers and Other Ranks 25,069.0 2.4% 29,912.2 2.3% 35,691.1 2.7%Logistics and Other Operating Costs 81,617.8 8.0% 97,386.0 7.4% 106,871.5 8.2%

o/w: Outstanding Payment for on-going Contracts for Vehicles, Comm.Equipment, Security Hardware etc. 44,946.7 4.4% 53,630.2 4.1% 63,991.3 4.9%

Drugs and Medical Supplies 13,402.1 1.3% 15,991.3 1.2% 19,080.7 1.5%

205 Ministry of Internal Affairs 1,356.3 0.1% 1,618.3 0.1% 1,931.0 0.1%Administrative and Operating Costs 1,356.3 0.1% 1,618.3 0.1% 1,931.0 0.1%

B OTHER SECTOR MDAS AND SUBVENTED AGENCIES 940,339.7 20.4% 1,003,141.9 19.1% 1,242,013.7 21.8%1 PUBLIC ADMINISTRATION SECTOR 531,856.8 18.7% 536,647.2 17.7% 690,480.1 21.8%

106 Office of the Chief of Staff 7,840.1 0.8% 9,354.8 0.7% 11,162.1 0.9%Office of the Director of Administration and Finance 2,813.6 0.3% 3,357.2 0.3% 4,005.8 0.3%Strategy and Policy Unit 834.1 0.1% 995.2 0.1% 1,187.5 0.1%Millennium Challenge Compact Secretariat 903.0 0.1% 1,077.5 0.1% 1,285.7 0.1%Project Development/PPP Unit 610.7 0.1% 728.7 0.1% 869.5 0.1%Communications Unit 305.4 0.0% 364.3 0.0% 434.7 0.0%Extractive Industry Transparency Initiative Secretariat 729.9 0.1% 870.9 0.1% 1,039.1 0.1%Perfomance Management and Service Delivery Directorate 1,263.9 0.1% 1,508.1 0.1% 1,799.5 0.1%Citizens Stakeholders Committee Secretariat 379.5 0.0% 452.8 0.0% 540.2 0.0%

108 Sierra Leone Small Arms Commission 903.7 0.1% 1,078.3 0.1% 1,286.7 0.1%

110 Office of the President 34,609.7 3.4% 41,296.1 3.2% 49,274.3 3.8%Office of the Secretary to the President 20,028.9 2.0% 23,898.4 1.8% 28,515.4 2.2%

o/w: Open Government Initiative Secretariat 296.0 0.0% 353.2 0.0% 421.4 0.0%Gender Adviser's Unit 663.2 0.1% 791.3 0.1% 944.2 0.1%

Anti-Corruption Commission (ACC) 6,129.1 0.6% 7,313.3 0.6% 8,726.2 0.7%Independent Media Commission (IMC) 643.0 0.1% 767.2 0.1% 915.5 0.1%Political Parties Registration Commission (PPRC) 2,659.6 0.3% 3,173.5 0.2% 3,786.6 0.3%Law Reform Commission 1,069.3 0.1% 1,275.9 0.1% 1,522.4 0.1%Local Government Service Commission 252.4 0.0% 301.2 0.0% 359.4 0.0%Public Sector Reform Unit (PSRU) 1,147.9 0.1% 1,369.6 0.1% 1,634.3 0.1%Office of the Ombudsman 1,688.8 0.2% 2,015.0 0.2% 2,404.3 0.2%Sierra Leone Insurance Commission 990.6 0.1% 1,182.0 0.1% 1,410.3 0.1%





xix

112 Office of the Vice President 14,431.4 1.4% 17,219.5 1.3% 20,546.2 1.6%

116 Parliament 15,317.4 1.5% 18,276.7 1.4% 21,807.7 1.7%

117 Cabinet Secretariat 2,553.8 0.2% 3,047.2 0.2% 3,635.9 0.3%o/w: Cabinet Oversight and Monitoring Unit 695.5 0.1% 829.9 0.1% 990.2 0.1%

118 The Judiciary 13,874.9 1.4% 16,555.5 1.3% 19,753.9 1.5%

121 Audit Service Sierra Leone 7,297.3 0.7% 8,707.1 0.7% 10,389.3 0.8%

122 Human Resource Management Office 2,968.9 0.3% 3,542.5 0.3% 4,226.9 0.3%

123 Public Service Commission 2,550.1 0.2% 3,042.8 0.2% 3,630.6 0.3%

125 Local Courts 1,533.5 0.1% 1,829.8 0.1% 2,183.3 0.2%

126 Independent Police Complaints Board 1,065.0 0.1% 1,270.7 0.1% 1,516.2 0.1%

130 National Revenue Authority (NRA) 90,461.9 8.8% 107,938.7 8.2% 122,247.8 9.3%

131 Revenue Appellate Board 1,251.3 0.1% 1,493.0 0.1% 1,781.4 0.1%

132 Accountant General's Department 37,698.8 3.7% 7,933.0 0.6% 9,465.6 0.7%

134 National Electoral Commission (NEC) 123,862.2 12.1% 60,932.8 4.6% 124,909.6 9.5%

138 Statistics - Sierra Leone 7,707.1 0.8% 9,196.1 0.7% 10,972.7 0.8%

139 National Commission for Privatisation (NCP) 2,711.1 0.3% 3,234.9 0.2% 3,859.8 0.3%

140 Mass Media Services 260.7 0.0% 311.1 0.0% 371.2 0.0%

141 Government Printing Department 3,216.1 0.3% 3,837.4 0.3% 4,578.8 0.3%

142 National Public Procurement Authority (NPPA) 3,563.9 0.3% 4,252.4 0.3% 5,073.9 0.4%

143 Justice and Legal Service Commission 365.7 0.0% 436.3 0.0% 520.6 0.0%

144 Human Rights Commission Sierra Leone 2,520.8 0.2% 3,007.8 0.2% 3,588.9 0.3%

145 Rights to Access Information Commission 1,138.6 0.1% 1,358.6 0.1% 1,621.1 0.1%

409 Sierra Leone Standards Bureau 2,981.5 0.3% 3,557.5 0.3% 4,244.8 0.3%

501 Miscellaneous Services 221.3 0.0% 264.1 0.0% 300.1 0.0%501001 Miscellaneous Services - Secretary to the President 0.0 0.0% 0.0 0.0% 0.0 0.0%501002 Miscellaneous Services - General 0.0 0.0% 0.0 0.0% 0.0 0.0%501003 Miscellaneous Services - Accountant-General's Office 221.3 0.0% 264.1 0.0% 300.1 0.0%

610 CONTINGENCY EXPENDITURE 148,950.0 13.8% 203,672.6 15.5% 247,530.5 18.9%Contingency Fund 90,000.0 8.8% 101,836.3 7.8% 123,765.3 9.4%Special Presidential Warrants 45,000.0 4.4% 50,918.1 3.9% 61,882.6 4.7%Unallocated Expenditures 13,950.0 1.4% 50,918.1 3.9% 61,882.6 4.7%





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2 GROWTH SECTOR 18,187.4 1.7% 21,013.8 1.6% 25,893.7 2.0%

110 Petroleum Directorate 0.0 0.0% 0.0 0.0% 0.0 0.0%

203 National Civil Registration Authority 2,714.3 0.3% 3,238.6 0.2% 3,864.3 0.3%

403 Support to the National Minerals Agency 3,196.9 0.3% 3,814.6 0.3% 4,551.5 0.3%

405 National Tourist Board 6,345.4 0.6% 7,571.3 0.6% 9,034.0 0.7%o/w: Development and Implementation of Tourism Marketing Strategy 729.4 0.1% 870.4 0.1% 1,038.5 0.1%

National and Railway Museums 800.0 0.1% 954.6 0.1% 1,139.0 0.1%

409 Sierra Leone Investment and Export Promotion Agency 4,556.1 0.4% 5,436.3 0.4% 6,486.6 0.5%

409 Support to Sierra Leone Produce Marketing Company 576.0 0.1% 687.3 0.1% 820.1 0.1%

419 Local Content Agency 798.7 0.1% 953.0 0.1% 1,137.1 0.1%

3 SOCIAL SERVICES AND HUMAN DEVELOPMENT SECTOR 32,079.4 15.5% 38,277.0 8.0% 45,672.0 14.5%

211 Immigration Department 5,827.6 0.6% 6,953.4 0.5% 8,296.8 0.6%Administrative and Operating Costs 2,866.4 0.3% 3,420.2 0.3% 4,081.0 0.3%Manning of Various Border Immigration Posts 2,961.2 0.3% 3,533.2 0.3% 4,215.8 0.3%

307 National Medical Supplies Agency 1,185.9 0.1% 1,415.0 0.1% 1,688.4 0.1%Administrative and Operating Costs 1,185.9 0.1% 1,415.0 0.1% 1,688.4 0.1%

309 Dental and Medical Board 434.6 0.0% 518.6 0.0% 618.8 0.0%

308 National Commission for Social Action 1,791.4 0.2% 2,137.5 0.2% 2,550.4 0.2%

310 National Youth Commission 5,163.8 0.5% 6,161.5 0.5% 7,351.8 0.6%

311 Health Service Commission 1,223.2 0.1% 1,459.6 0.1% 1,741.5 0.1%

312 Teaching Service Commission 1,471.6 0.1% 1,755.9 0.1% 2,095.2 0.2%

313 National Youth Service 2,655.0 0.3% 3,167.9 0.2% 3,780.0 0.3%

314 National HIV and AIDS Commission 2,940.0 0.3% 3,508.0 0.3% 4,185.7 0.3%

315 Teaching Hospitals Complex Administration 3,040.0 0.3% 3,627.3 0.3% 4,328.1 0.3%

316 Civil Service Training College 800.0 0.1% 954.6 0.1% 1,139.0 0.1%

345 Pharmacy Board Services 5,346.3 0.5% 6,379.1 0.5% 7,611.6 0.6%

412 National Telecommunications Commission (NATCOM) 200.0 0.0% 238.6 0.0% 284.7 0.0%

4 PHYSICAL INFRASTRUCTURE AND ENERGY SECTOR 155,831.8 15.2% 165,719.9 12.6% 191,830.4 14.6%

110 National Assets and Government Property Commission 1,208.7 0.1% 1,442.2 0.1% 1,720.8 0.1%

410 National Protected Area Authority 2,155.6 0.2% 2,572.1 0.2% 3,069.0 0.2%o/w: Conservation Trust Fund Agency 773.4 0.1% 922.8 0.1% 1,101.1 0.1%





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411 Road Maintenance Fund 128,900.0 12.6% 133,585.0 10.2% 153,487.2 11.7%Road Maintenance Fund Administration 15,395.0 1.5% 18,612.1 1.4% 21,612.1 1.6%Sierra Leone Roads Authority 22,865.7 2.2% 27,644.0 2.1% 33,644.0 2.6%Road Maintenance Activities 90,639.3 8.8% 87,328.9 6.7% 98,231.1 7.5%

413 Sierra Leone Electricity and Water Regulatory Commission 1,367.1 0.1% 1,631.3 0.1% 1,946.4 0.1%

414 Water Directorate 12,336.2 1.2% 14,719.4 1.1% 17,563.2 1.3%o/w: Grants to SALWACO 9,344.5 0.9% 11,149.8 0.9% 13,303.8 1.0%o/w: Emergency Recovery Priority Programmes on Water 1,595.5 0.2% 1,903.8 0.1% 2,271.6 0.2%

416 Civil Aviation Authority 2,034.3 0.2% 2,427.3 0.2% 2,896.2 0.2%

417 Nuclear Safety and Radiation Protection Authority 2,104.8 0.2% 2,511.5 0.2% 2,996.7 0.2%

418 Sierra Leone Agricultural Research Institute (SLARI) 5,725.1 0.6% 6,831.1 0.5% 8,150.9 0.6%

5 GOVERNANCE, JUSTICE AND SECURITY SECTOR 202,384.3 121.5% 241,484.0 120.3% 288,137.6 138.3%

110 Corporate Affairs Commission 947.9 0.1% 1,131.1 0.1% 1,349.6 0.1%

124 Justice Sector Coordinating Office 1,215.6 0.1% 1,450.5 0.1% 1,730.7 0.1%

124 Legal Aid Board 5,345.9 0.5% 6,378.7 0.5% 7,611.1 0.6%

137 National Commission for Democracy 1,896.5 0.2% 2,262.9 0.2% 2,700.1 0.2%

206 Sierra Leone Police 97,469.6 9.5% 116,300.3 8.9% 138,769.0 10.6%Administrative and Operating Costs 29,281.0 2.9% 34,937.9 2.7% 41,687.7 3.2%

o/w Fuel and Spares 13,312.0 1.3% 15,883.8 1.2% 18,952.5 1.4%Rice for Officers and Other Ranks 44,595.1 4.4% 53,210.7 4.1% 63,490.7 4.8%Security Hardware and Other Logistics 23,593.6 2.3% 28,151.7 2.1% 33,590.5 2.6%

o/w: Outstanding payment for Peace Keeping Operations Contract 4,952.1 0.5% 5,908.8 0.5% 7,050.3 0.5%

207 Sierra Leone Correctional Services 58,188.6 5.7% 69,430.4 5.3% 82,844.0 6.3%o/w: Inmates Welfare (Diets, Toiletories, Drugs etc) 45,356.6 4.4% 54,119.3 4.1% 64,574.8 4.9%

Uniforms and Regalia for Correctional Officers 3,047.0 0.3% 3,635.7 0.3% 4,338.1 0.3%Rice for Officers and Other Ranks 5,830.4 0.6% 6,956.8 0.5% 8,300.8 0.6%

208 National Fire Authority 11,734.3 1.1% 14,001.4 1.1% 16,706.4 1.3%Administrative and Operating Costs 1,321.2 0.1% 1,576.4 0.1% 1,881.0 0.1%Improve Delivery of Fire Services 10,413.2 1.0% 12,425.0 0.9% 14,825.4 1.1%

o/w: Fire Engines 7,822.9 0.8% 9,334.2 0.7% 11,137.6 0.8%

209 Central Intelligence & Security Unit 6,975.1 0.7% 8,322.6 0.6% 9,930.5 0.8%

210 Office of National Security 9,433.5 0.9% 11,256.0 0.9% 13,430.6 1.0%Administrative and Operating Costs 4,221.7 0.4% 5,037.3 0.4% 6,010.4 0.5%Coordination of the Security Sector 5,211.9 0.5% 6,218.8 0.5% 7,420.2 0.6%

212 National Drugs Law Enforcement Agency 1,313.5 0.1% 1,567.2 0.1% 1,870.0 0.1%

415 Sierra Leone Maritime Administration (SLMA) 1,800.0 0.2% 2,147.8 0.2% 2,562.7 0.2%





xxii

420 Sierra Leone Environment Protection Agency (SLEPA) 400.0 0.0% 477.3 0.0% 569.5 0.0%

421 Small and Medium Enterprises Development Agency (SMEDA) 4,350.0 0.4% 5,190.4 0.4% 6,193.2 0.5%

422 Sierra Leone Meteorological Agency 1,313.7 0.1% 1,567.5 0.1% 1,870.3 0.1%

C LOCAL COUNCILS 139,906.5 13.0% 206,972.9 15.8% 273,078.0 20.8%

701 Grants for General Administrative Expenses 5,935.9 0.6% 7,920.2 0.6% 12,567.8 1.0%Local Government Grants 5,935.9 0.6% 7,920.2 0.6% 12,567.8 1.0%

Grants for Devolved Functions 133,970.6 13.1% 199,052.7 15.2% 260,510.2 19.9%Sensitisation on Fire Prevention Services 939.9 0.1% 1,254.1 0.1% 1,673.3 0.1%Education Services 62,200.2 6.1% 98,290.5 7.5% 117,736.1 9.0%

Administration 4,271.4 0.4% 5,699.3 0.4% 7,604.4 0.6%Pre-primary and Primary Education 37,115.8 3.6% 59,820.8 4.6% 70,077.9 5.3%

of which: Examination Fees to WAEC for NPSE 5,877.2 0.6% 7,841.9 0.6% 10,463.3 0.8%of which: Govt. and Govt. Assisted Schools 31,238.6 3.0% 51,978.9 4.0% 59,614.7 4.5%

School Fees Subsidy 23,647.6 2.3% 41,850.3 3.2% 42,100.3 3.2%Textbooks 4,303.6 0.4% 5,742.2 0.4% 7,661.8 0.6%Teaching and Learning Materials 3,287.4 0.3% 4,386.3 0.3% 9,852.6 0.8%

Secondary Education 13,265.0 1.3% 22,699.3 1.7% 26,615.9 2.0%of which: Examination Fees to WAEC for BECE 9,014.2 0.9% 17,027.5 1.3% 16,048.1 1.2%of which: Textbooks 2,769.9 0.3% 3,695.8 0.3% 7,931.3 0.6%of which: Science Equipments 1,480.9 0.1% 1,975.9 0.2% 2,636.5 0.2%

Government Libraries 3,144.6 0.3% 4,195.8 0.3% 5,598.4 0.4%Education Development 4,403.4 0.4% 5,875.4 0.4% 7,839.4 0.6%

Youths and Sports Services 2,083.3 0.2% 2,779.7 0.2% 3,708.9 0.3%Sports Equipment 1,216.9 0.1% 1,623.7 0.1% 2,166.5 0.2%Youths Division 866.4 0.1% 1,156.0 0.1% 1,542.5 0.1%

Solid Waste Management Services 6,849.0 0.7% 9,138.5 0.7% 12,193.4 0.9%Health Care Services 30,396.8 3.0% 45,558.0 3.5% 69,116.0 5.3%

District Peripheral Health Care Services (PHCs) 15,460.9 1.5% 20,629.3 1.6% 37,525.3 2.9%Secondary Health Services (District Hospitals except, Bo, Kenema & Makeni) 14,935.9 1.5% 24,928.8 1.9% 31,590.7 2.4%

Social Welfare, Gender and Children's Affairs 4,137.2 0.4% 5,520.2 0.4% 7,365.5 0.6%Social Welfare Division 1,850.7 0.2% 2,469.4 0.2% 3,294.8 0.3%Gender and Children's Affairs Division 2,286.5 0.2% 3,050.8 0.2% 4,070.7 0.3%

Agriculture and Food Security Services 23,668.6 2.3% 31,580.7 2.4% 42,137.6 3.2%Fisheries and Marine Resources 582.0 0.1% 776.6 0.1% 1,036.1 0.1%Water services 3,113.6 0.3% 4,154.4 0.3% 5,543.2 0.4%Rural Water Services 3,113.6 0.3% 4,154.4 0.3% 5,543.2 0.4%





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GRAND TOTAL 1,409,000 1,046,000 1,519,000 1,395,000 1,756,000 1,767,000

A SECTOR MINISTRIES 792,300 276,450 698,250 342,250 919,000 601,2001 PUBLIC ADMINISTRATION SECTOR 4,000 33,000 - 28,550 - 25,550

Ministry of Political and Public Affairs 105 - 100 - 150 - 200Strengthening Diaspora Engagement Programme 105 Nationwide GoSL Budget - 100 - 150 - 200

Ministry of Local Development & Rural Development 107 - 300 - 500 - 650Social Capital Approach to Rural Development Project 107 Nationwide GoSL Budget - 300 - 500 - 650

Ministry of Foreign Affairs and International Cooperation 128 - 15,000 - 2,500 - 2,000Rehabilitation of Foreign Missions 128 GoSL Budget - 15,000 - 2,500 - 2,000

Ministry of Finance and Economic Development: 129 4,000 14,100 - 18,900 - 16,000Support to West African Monetary Zone (WAMZ) 129 Western Area GoSL Budget - 800 - 1,900 - 1,900Support to West African Monetary Agency (WAMA) 129 7,500 7,500 5,000Support to Medium Term Expenditure Framework (MTEF) 129 Western Area GoSL Budget - 500 - 1,500 - 500Rehabilitation of the National Development Bank 129 Western Area GoSL Budget - 500 - 1,000 - 500Public Financial Management Improvement and Consolidated Project 129 Western Area IDA/ABD/DfID/

GoSL Grant 4,000 500 - 1,000 - 500Institutional Support to Public Investment 129 Western Area GoSL Budget - 800 - 1,000 - 800Support to IPAU 129 Western Area GoSL Budget - 1,000 - 1,000 - 2,000Public Expenditure Tracking Survey 129 Western Area GoSL Budget - 1,000 - 1,500 - 1,800Support to NGO Coordination Unit 129 Western Area GoSL Budget - 500 - 1,000 - 500Support to Public Finanacial Management Reform 129 Western Area GoSL Budget - 1,000 - 1,500 - 2,500

Ministry of Information and Communication 133 - 3,500 - 6,500 - 6,700West Africa Regional Communications Infrastructural Programme 133 Nationwide GoSL Budget - 500 - 1,000 - 1,200Enhancing the Dedicated Information Security System 133 Nationwide GoSL Budget - 1,000 - 2,500 - 2,000Government Unified Messaging and Collaboration System Project 133 Nationwide GoSL Budget - 1,000 - 1,000 - 500Expansion of eGovernment Platform 133 Nationwide GoSL Budget - 1,000 - 2,000 - 3,000

2 GROWTH SECTOR 187,750 17,300 206,750 14,700 294,000 24,100Ministry of Tourism and Cultural Affairs 303 750 3,800 - 5,800 - 5,500

Construction of Cultural Village 303 Northen Region GoSL Budget - 800 - 2,500 - 1,000Promotion and Reactivation of Domestic Tourism in Coastal Areas 303 GoSL Budget 1,200 1,500 1,500Sustainable Tourism Development Project 303 Nationwide IDA/GoSL Grant 750 500 - 1,000 - 2,000Construction of a Nationl Art Gallery 303 GoSL Budget - 1,300 - 800 - 1,000

Ministry of Lands Country Planning and the Environment 306 10,000 750 11,250 800 20,000 2,000National Land Policy Reform Project 306 Nationwide IDA/GoSL Budget 10,000 500 11,250 500 20,000 1,000Lands Registration Project 306 Nationwide GoSL Budget - 250 - 300 - 1,000

Ministry of Agriculture and Food Security 401 172,500 8,750 190,000 4,500 264,000 9,600 Increase the Production of Staple Crops for Food Security 122,500 2,600 150,000 2,400 204,000 5,200

Linking Small Holders Farmers to Market 401 Nationwide IDB/GoSL Loan 38,000 600 45,000 600 60,000 1,300Small Holder Commercialization Programme/Global Agriculture andFood Security Programme (GAFSP) 401 Nationwide IFAD/GoSL Grant 49,500 500 65,000 500 89,000 1,400Smallholder Commercialisation and AgribusinessDevelopment Project (SCADeP) 401 Nationwide IDA/DFID/GoSL Loan 35,000 1,000 40,000 500 55,000 1,100Seed Multiplication Programme 401 Kambia, Bombali GoSL Budget - 500 - 800 - 1,400

Promote and Increase Value Adding Activities for Agricultural Goods - 1,100 - 300 - 800West Africa Agricultural Productivity Programme (WAPP) 401 Nationwide IDA/JICA/GoSL Loan - 800 - - - -Integrating Adaptation to Climate Change into Agricultural

Productivity and Food Security in Sierra Leone 401 Nationwide GEF/IFAD/GoSL Grant - 300 - 300 - 800 Increase the Production and Export of Cash Crops: 25,000 3,500 - - - -

Palm Oil Production Project in Sierra Leone in the Framework ofCapacity Building (POPSLCB) 401 Bonthe IDB/GoSL Loan 25,000 3,500 - -

ANNEX 4–SIERRA LEONE PUBLIC INVESTMENT PROGRAMME FY 2018-2020In Millions of Leones

FY 2018 FY 2019 FY 2020

AfP Funding FundingPillar Location Agency Type Foreign Domestic Foreign Domestic Foreign DomesticVote (Indicative) (Indicative) (Indicative) (Indicative)

xxiv

Improve Access to Finance for Farmers 25,000 500 40,000 1,000 60,000 2,000Rural Finance and Community Improvement Project Phase 11 401 Nationwide IFAD/GoSL Loan 25,000 500 40,000 1,000 60,000 2,000

o/w Support to the Apex Bank 401 IFAD/GoSL Grant - 500 - 1,000 - 2,000Support to Sierra Leone Seed Certification Agency (SLeSCA) 401 Nationwide GoSL Budget - 600 - 800 - 1,600Sierra Leone Biodiversity Project 401 Nationwide GoSL Budget - 250 - - - -Sierra Leone Wetlands Conservation Project 401 Nationwide GoSL Budget - 200 - - - -

Ministry of Fisheries and Marine Resources 402 - 3,650 - 3,250 - 5,500 Increase the Supply of Fish for Domestic Market Nationwide - 2,200 - 2,500 - 4,000

Promote Inland Fisheries and Acquaculture 402 Nationwide GoSL Budget - 2,200 - 2,500 - 4,000Increase Fish Export by Focusing on Strategic High Value Markets - 1,000 - - - -European Fish Certification Project - PRECON 402 Nationwide GoSL Budget - 1,000 - - - -

Promote and Increase Value Adding Activities for Fishering Products - 250 - 500 - 1,500Fish Stock Assesment Project 402 Nationwide GoSL Budget - 250 - 500 - 1,500Protection of Marine and Fisheries Product - 200 - 250 - -Rehabilitation of Radar System 402 Nationwide GoSL Budget - 200 - 250 - -

Ministry of Mines and Mineral Resources 403 500 - 1,000 - - -Extractive Industries Technical Assistance Project-Phase II 403 Nationwide IDA Grant 500 - 1,000 - - -

Ministry of Trade and Industry 409 4,000 350 4,500 350 10,000 1,500Growth Centre Programme 409 Nationwide GoSL Budget - 250 - 250 - 1,000Private Sector Development Programme 409 Nationwide EU/GoSL Grant 3,000 100 4,500 100 10,000 500Technical Assistance to Implement the SEZ Law and Regulations 409 IDB Grant 1,000 - - -

3 SOCIAL SERVICES AND HUMAN DEVELOPMENT SECTOR 180,300 62,550 142,500 55,350 120,000 83,850Ministry of Eduction, Science and Technology 301 45,000 5,150 30,000 6,200 - 6,100

Making Education more Equitable and Accessible 301 45,000 4,700 30,000 5,550 - 5,200Rehabilitation of Fourah Bay College 301 Western Area BADEA/Saudi

Fund/GoSL Loan 45,000 3,500 30,000 3,500 - -Support to Ernest Bai Koroma University (Magburaka) 301 North GoSL Budget - 500 - 750 - 1,600Rehabilitation of Port Loko Teachers' College 301 Port Loko GoSL Budget - 250 - 350 - 800Rehabilitation of Seven (7) government boarding Schools 301 Nationwide GoSL Budget - 250 - 700 - 2,000Rehabilitation of three(3) Office Buildings 301 Nationwide GoSL Budget - 200 - 250 - 800

Tertiary Education and Tec/Voc Education and Training: 301 - 450 - 650 - 900Institutional and Capacity Building to Technical and Vocational Education301 Nationwide IDB/GoSL Budget - 250 - 350 - 100Revitalization of Education In Sierra Leone 301 Nationwide IDA/GoSL Budget - 200 - 300 - 800

Ministry of Health and Santitation 304 125,300 48,700 105,000 37,650 120,000 37,500Reducing High Infant, Under-five and Maternal Mortality 304 51,000 2,000 25,000 2,850 50,000 4,000

Reproductive Child Health Care Project II 304 Nationwide IDA/GoSL Grant 36,000 500 15,000 850 35,000 1,200Health Systems Strenthening Project(Save the Mothers Project) 304 Nationwide IDB/GoSL Grant 15,000 1,500 10,000 2,000 15,000 2,800

Preventing and Controlling Communicable and Non-Communicable Diseases: 304 21,300 5,500 18,000 8,000 35,000 15,000Global Fund Round 10 - Phase II Malaria 304 Nationwide Global Fund/GoSLGrant 14,800 3,500 10,000 5,000 20,000 10,000Global Fund Transistional Funding Mechanism Grants to TB 304 Nationwide Global Fund/GoSLGrant 6,500 2,000 8,000 3,000 15,000 5,000

Strengthening Infrastructural Development for Service Delivery: 304 53,000 41,200 62,000 26,800 35,000 18,500Refurbishment of Government Hospitals Project (Mortuaries) 304 Nationwide GoSL Budget - 1,200 - 1,500 - 1,700Strengthening of Three Tertiary Hospitals in Freetown 304 Nationwide Kuwait Fund/GoSLGrant 35,000 29,500 40,000 15,000 - 6,000Primary Health Care Support Project 304 Nationwide BADEA/GoSL Grant 18,000 500 22,000 300 35,000 800Support to Public Health Sierra Leone 304 Nationwide GoSL Budget - 10,000 - 10,000 - 10,000

Ministry of Social Welfare, gender and Children Affairs 10,000 - 7,500 - - -Post Ebola Recovery Social Investment Project 305 Nationwide ABD Grant 10,000 - 7,500 - - -

Ministry of Youth Affairs - 8,700 - 11,500 - 40,250National Youth Development, Empowerment and Enterpreneurship Project310 Nationwide GoSL Budget - 1,500 - 2,000 - 6,000National Youth Service Programme 310 Nationwide GoSL Budget - 3,000 - 4,000 - 10,000Support to National Youth Village Project 310 Nationwide GoSL Budget - 1,200 - 1,500 - 10,000Youth Farm Project 310 Nationwide GoSL Budget - 1,000 - 1,500 - 8,000Youth in Fisheries Project 310 Nationwide GoSL Budget - 2,000 - 2,500 - 6,250


FY 2018 FY 2019 FY 2020


xxv

4 PHYSICAL INFRASTRUCTURE & ENERGY SECTOR 420,250 158,150 349,000 237,850 505,000 461,000Ministry of Works, Housing and Infrastructure 408 - 10,000 - 10,000 - 25,000

Reconstruction/Rehabilitation of Government Buildings 408 GoSL - 10,000 - 10,000 - 25,000Ministry of Water Resources 414 5,000 250 3,000 200 - -

Water Sector Reform Projects 414 Nationwide MCC/GoSL Grant 5,000 250 3,000 200 - -Ministry of Transport and Aviation 404 35,000 11,500 20,000 14,600 45,000 31,000

National Transport Database System Project 404 Nationwide GoSL Budget - 300 - 400 - -Procurement of 100 Government Buses 405 Nationwide GoSL Budget - 5,000 - 6,500 - 15,000Freetown Sustainable Urban Transportation Project 404 Nationwide IDA/GoSL Loan 35,000 200 20,000 200 45,000 1,000Traffic Lights Project 404 GoSL Budget 4,500 - 5,000 - 10,000Freetown International Airport Project (Support to PIU) 404 Western Area GoSL Budget - 1,500 - 2,500 - 5,000

Ministry of Energy 380,250 136,400 304,000 213,050 415,000 405,000 Increase Electricity Generation: Energy Generation & Transmission 406 - 59,500 - 113,250 - 175,000

Rural Electrification Project(Generation) 406 Nationwide GoSL Budget - 25,000 - 37,500 - 85,000Rural Electrification (Solar Street Lights Projects) 406 Nationwide GoSL Budget - 33,750 - 75,000 - 90,000Construction of Bankasoka Mini Hydro (Compensation) 406 Port Loko GoSL Budget - 750 - 750 - -Enhancement of Existing Thermal Plants and Transmission: 406 158,000 16,700 105,000 21,000 135,000 67,000Lungi Thermal Plant 406 Lungi GoSL Budget - 1,000 - - - -Kono Thermal Plants 406 Kono GoSL Budget - 1,500 - 1,500 - 10,000Procurement of 30MW HFO Machine 406 GoSL Budget - 10,000 - 15,000 - 35,000Rehabilitation and Extention of Bo-Kenema Distibution System 406 Bo, Kenema AfDB/DFID/GoSLGrant/Loan 95,000 1,200 60,000 1,500 80,000 5,000Solar Park Project 406 Western Area Abu Dhabi Fund/GoSL 63,000 2,000 45,000 2,000 55,000 12,000Barefoot Women Solar Project 406 Nationwide GoSL Budget - 1,000 - 1,000 - 5,000

Rebuilding and Enhancing the Distribution Network and Energy Supply 406 208,250 60,200 183,000 78,800 250,000 163,000Rural Electrification Project (T&D) 406 Nationwide GoSL Budget - 33,500 - 40,000 - 60,000West African Power Pool Project 406 Nationwide EU/AfDB/IDA/GoSLLoan 80,000 5,000 45,000 7,500 60,000 15,000Re-enforcement and Expansion of the Medium and Low VoltageNetwork in the Western Area 406 Western Area IDB/GoSL Loan 10,500 10,000 8,000 15,000 15,000 25,000Extension of Electricity supply from Makeni to Magburaka andMatotoka (phase II and III) 406 North & East GoSL Budget - 5,000 - 7,500 - 20,000Rural Electrification Project - CLSG 406 Nationwide ADB/GoSL Grant 30,000 1,500 35,000 2,000 65,000 10,000Enhancing the National Grid 406 Nationwide GoSL Budget - 1,200 - 1,300 - 8,000Upgrade of Distribution Transformer from 5-8MVA at Bumbuna 406 Nationwide GoSL Budget - 1,500 - 2,000 - 10,000Supply and Installation of 225KV Double Circuit Transmision Line from Bumbuna II to Waterloo 406 Indian Exim Bank/GoSL Loan 87,750 2,500 95,000 3,500 110,000 15,000

Energy Sector Reform and Management 406 14,000 - 16,000 - 30,000 -Energy Sector Utility Reform Project (ESURP) 406 Nationwide IDA Loan 10,000 - 10,000 - 15,000 -Electricity Sector Reform Project 406 Western Area MCC Grant 4,000 - 6,000 - 15,000 -

5 GOVERNANCE, JUSTICE AND SECURITY SECTOR - 5,450 - 5,800 - 6,700Ministry of Internal Affairs 205 - 1,550 - 2,100 - 1,200

Machine Readable Passports Project 205 Western Area GoSL Budget - 1,000 - 1,500 - -Establishment of an Integrated Immigration Control System 205 Nationwide GoSL Budget - 550 - 600 - 1,200

Attorney General, Ministry of Justice 124 - 1,200 - 1,400 - -Restructuring, facelift and reorganisation of Law Officers Department 124 Western Area GoSL Budget - 1,200 - 1,400 - -

Ministry of Defense 201 - 2,700 - 2,300 - 5,500Support to Rehabilitation of Military BarracksRSLAF

(Tekoh Barracks, Daru Barracks and 34 Hospital) 201 Nationwide GoSL Grant - 1,800 - 1,400 - 2,500Construction of Housing units at Gondama and Wilberforce- Phase II 201 Wilberforce and

Gondama GoSL Grant - 900 - 900 - 3,000


FY 2018 FY 2019 FY 2020


xxvi

B OTHER SECTOR MDAs & SUBVENTED AGENCIES 616,700 719,450 820,750 1,022,650 837,000 1,135,7001 PUBLIC ADMINISTRATION SECTOR 15,000 16,200 4,500 17,450 15,000 20,600

Office of the Chief of State 106 1,500 1,000 4,500 1,350 15,000 4,200Support to the Energy and Water Regulatory Commission on theImplementation of the MCC 106 Nationwide MCC/GoSL Grant 1,500 500 4,500 750 15,000 2,000Support to Public Private Partnership Unit 106 Nationwide GoSL Budget - 250 - 300 - 1,000Support to Performance Management and Service Delivery Programme 106 Nationwide GoSL Budget - 250 - 300 - 1,200

Small Arms Commission 108 - 500 - 400 - 1,000National Survey of Local Artisans 108 Nationwide GoSL Budget - 500 - 400 - 1,000

Office of the President 110 6,000 4,150 - 3,400 - 6,100OGI/OGP Offices 110 - 1,200 - 1,500 - 2,000

Open Government Partnership & Open Governmnet Initiative 110 Nationwide GoSL Budget - 1,200 - 1,500 - 2,000Anti Corruption Commission 110 - 1,200 - 800 - 1,500

Construction of Anti-Corruption Building 110 Nationwide GoSL Budget - 1,200 - 800 - 1,500Law Reform Commission 110 2,500 250 - 300 - 800

Review and Amendments of Existing Laws 110 Nationwide GoSL Budget - 250 - 300 - 800Technical Assistance to Law Reform Commission 110 IDB Grant 2,500 - - - - -Modernisation of Revenue Administration System Project 130 Nationwide GoSL Grant - 500 - 200 - 800

Human Resources Management Offices(HRMO) 122 122 7,500 500 - 300 - 1,200Civil Service Reform Project 122 Nationwide EC/GoSL Grant 7,500 500 - 300 - 1,200

Support to the Civil Service Training College 316 Nationwide - 500 - 800 - 1,800Rehabilitation of Civil Service Training College 316 GoSL Budget - 500 - 800 - 1,800

Public Service Commission(PSC) 123 - 800 - 1,200 - -Construction of a Multi Storey Office Complex 123 Nationwide GoSL Budget - 800 - 1,200 - -

Statistics Sierra Leone(SSL) 138 - 4,250 - 3,100 - 1,000Agriculture Tracking Survey (ATS) 138 Nationwide GoSL Budget - 1,000 - 800 - -Demographic Health Survey (DHS) 138 Nationwide GoSL Budget - 800 500 -Labour Force Survey(LFS) 138 Nationwide GoSL Budget - 700 - 500 - -Sierra Leone Integrated Household Survey (SLIHS) 138 Nationwide GoSL Budget - 1,000 - 800 - -Census on Business Establishment 138 Nationwide GoSL Budget - 500 - 300 - -Rehabilitation of Statistics Sierra Leone Head Office Building 138 Nationwide GoSL Budget - 250 - 200 - 1,000

Audit Service Sierra Leone 121 - 2,000 - 4,000 - -Construction of Office Building 121 Nationwide GoSL Budget - 2,000 - 4,000 - -

2 GROWTH SECTOR 2,000 7,200 4,500 4,800 8,000 17,100Sierra Leone Investment and Export Promotion Agency(SLIEPA) 409 - 1,000 - 800 - 1,500

Institutional support to SLEIPA 409 Nationwide GoSL Budget - 1,000 - 800 - 1,500Sierra Leone Agricultural Research Institute 418 2,000 1,200 4,500 800 8,000 1,800

Support to Sierra Leone Agricultural Reseach Institute (SLARI) 418 Nationwide AGRA/AfricaRice/GoSL Grant 2,000 1,200 4,500 800 8,000 1,800

National Mineral Agency(NMA) 403 - 200 - 200 - 800Rehabilitation/Reconstruction of National MineralsAgency Regional Offices 403 Nationwide GoSL Budget - 200 - 200 - 800

National Tourist Board(NTB) 405 - 3,000 - 2,200 - 10,000Lumley Beach Development Project - Phase II 405 Western Area GoSL Budget - 1,500 - 800 - 2,500Peninsular Beaches Development Project 405 Western Rural GoSL Budget - 500 - 600 - 4,000Sustainable Tourism Development and Promotion Project 405 Nationwide GoSL Budget - 1,000 - 800 - 3,500

Monuments and Relics Commission 405 - 1,800 - 800 - 3,000Monument and Relics Development Project 405 Nationwide GoSL Budget - 1,000 - 800 - 3,000Rehabilitation/Rehabilitation of Museums 405 Nationwide GoSL Budget - 800 - - - -

3 SOCIAL SERVICES AND HUMAN DEVELOPMENT SECTOR 22,600 52,100 35,000 4,200 75,000 22,000National Commission for Social Action(NaCSA) 308 21,600 51,500 35,000 3,600 75,000 19,000

Social Action Support Project 308 Nationwide GoSL Budget - 500 - 500 - 2,500Sierra Leone Commmunity Driven Development Project (SLCDD) 2 308 Nationwide IDB/GoSL Loan 12,600 1,500 15,000 1,500 30,000 5,000


FY 2018 FY 2019 FY 2020


xxvii

Relief and Resettlement 308 W/A; South & East UNHCR/GoSL Grant 5,000 100 10,000 100 20,000 500Growth for Peace Consolidation 11 (GPC2) 308 North & East KfW/GoSL Grant 4,000 500 10,000 500 25,000 5,000National Social Safety Nets Programme 308 Nationwide GoSL Budget - 37,500 - - - -Support to Reparation Programme 308 Nationwide GoSL Budget - 11,400 - 1,000 - 6,000

National HIV/AIDS Commission 314 1,000 600 - 600 - 3,000Simple Application Process (SAP) Project 314 Nationwide GoSL 1,000 600 - 600 - 3,000

4 PHYSICAL INFRASTRUCTURE & ENERGY SECTOR 576,100 543,050 775,250 833,800 737,500 946,150Sierra Leone Water Company(SALWACO) 414 115,000 102,100 118,000 82,600 170,000 208,000

Three (3) Towns - Bo, Kenema and Makeni - Water Supply System Project Phase II 414 Bo, Kenema &

Makeni OPEC/GoSL Loan 60,000 10,000 68,000 18,000 80,000 30,000Kabala Water Supply System Project Phase 11 414 Kabala GoSL Loan - 3,000 - 2,000 - 10,000Rural Water Supply and Sanitation Project 414 Nationwide ADB/GEF/

RWSSTF/GoSL Loan 35,000 4,000 35,000 4,000 55,000 16,000Drilling of Wells and Rural Development 414 Saudi Fund Grant 20,000 - 15,000 - 35,000 -Construction of Waterloo Gravity Scheme 414 Western Rural GoSL Budget - 5,000 - 3,500 - 10,000Improvement of Mile 91/Yonibana Water Supply Source (Phase 11) 414 Mile 91 GoSL Budget - 2,500 - 2,500 - 8,000Rehabilitation of Eight(8) Small towns Water Supply Project 414 Nationwide GoSL Budget - 3,000 - 6,000 - 16,000Reconstruction of Blama and Bandawor and Six Villages Water

Supply System 414 Blama GoSL Budget - 4,500 - 2,000 - 10,000Construction of Water Supply Systems in Bonthe City (Island) & Mattru 414 Bonthe GoSL Budget - 4,000 - 2,500 - 12,000Construction of Water Supply Systems in Taiama & Njala 414 Bonthe GoSL Budget - 6,100 - 6,100 - 18,000Lungi Water Supply (Extension of Distribution Network) 414 Lungi GoSL Budget - 25,000 - 18,000 - 28,000Procurement of Chemical Re-agent, labaoratory materials and equipments 414 Nationwide GoSL Budget - 15,000 - 8,000 - 20,000Procurement and Installation of Meters ,Billing Software and Laboratory

Equipment 414 Nationwide GoSL Budget - 20,000 - 10,000 - 30,000Guma Valley Water Company(GVWC) - 11,700 - 20,000 - 40,000

Improve Access of Portable Water in the Western Urban 414 - 11,700 - 20,000 - 40,000Freetowm Water Supply Rehabilitation Project 414 Western Area GoSL Budget - 11,700 - 20,000 - 40,000

Sierra Leone Roads Authority(SLRA) 408 460,100 426,000 657,250 726,950 567,500 694,900Construction/Rehabilitation of Trunk Roads 408 362,000 266,500 572,000 418,950 490,000 494,400

o/w Rehabilitation of the Makeni -Kamakwe -Madina Oula Road 408 Bombali GoSL Budget - 25,000 - 40,000 - 55,000Rehabilitation of Makeni-Kabala Road Phase 11 408 Makeni, Kabala GoSL Budget - 20,000 - 34,000 - 40,000Upgrading Mange - Mambolo and Rokupr Spur Road 408 Kambia GoSL Budget - 15,000 - 30,000 - 35,000Rehabilitation of Bandajuma - Pujehun Road 408 Pujehun GoSL Budget - 10,000 - 25,000 - 38,000Rahabilitation of Taiama Junction - N'jala University Road 408 Moyamba GoSL Budget - 15,000 - 25,000 - 35,000Reconstruction of Bo-Bandajuma Road 408 Bo, Bandajuma ABD/OFID/GosL Loan 80,000 11,000 40,000 25,000 65,000 35,000Bo -Mattru Jong, Moyamba - Shenge, & Pujehun - Gbondapie 408 GoSL Budget - 16,500 - 30,000 - 40,000Targrin - Lungi - Konakridee (Targrin - Lungi: Dual Carriageway 14Km x 2)and (Lungi - Konakridee (14Km) +Lungi Township Roads 408 GoSL Budget - 25,000 - 31,000 - 25,000Reconstruction of Makakura - Yifin - Alkalia - Kumala - Sumbaria -Masingbi (142.1Km) Phase I (Segment 1: 38Km) 408 GoSL Budget - 25,000 - 45,000 - 50,000Rehabilitation of Kabala - Krubonla - Kono 408 GoSL Budget - 10,000 - 30,000 - 15,000Reconstruction of Kambia-Tamporie-Kamakwie Road 408 IDB/CFD/GoSL Loan 70,000 15,000 375,000 15,000 210,000 25,000Rehabilitation of Kenema-Pendembu Road 408 Kenema IDB/KFAED/

Saudi Fund/GoSL Loan 40,000 14,000 - 20,000 - 28,000Rehabilitation of Pendembu - Kailahun Road 408 Kenema IDB/GoSL Loan 30,000 15,000 28,000 10,000 35,000 15,000Rehabilitation of Matotoka - Sefadu Road (Matotoka-Yiye Section) 408 Tonkolili, Kono ADB/OFID/GoSL Loan 20,000 20,000 10,000 10,000 20,000 15,000Rehabilitation of Matotoka - Sefadu Road (Yiye- Sefadu Section) 408 Tonkolili, Kono KFAED/GoSL Loan 37,000 25,000 34,000 33,400 40,000 33,400Reconstruction of Bandajuma - MRU Bridges and 3 Bridges 408 South EU/GoSL Grant 45,000 - 45,000 - 55,000 -Magbele, Mabang, Kpangbama, Moyamba Bridges - Moyamba Junction408 North,South EU/GoSL Grant 40,000 5,000 40,000 15,550 65,000 10,000


FY 2018 FY 2019 FY 2020


xxviii

Rehabilitation of Streets and Roads in Western Area 408 98,100 97,500 85,250 209,500 77,500 126,500o/wConstruction of Hill Side By Pass Road Phase 11 408 Western Area KFAED/GoSL Loan 54,100 5,000 35,250 35,000 32,500 19,000

Widening Wilkinson Road Project including BottomMango,Signal Hill, King street 408 Western Area GoSL Budget - 5,000 - 25,000 - 10,000Rehabilitation of Spur Road 408 Western Area GoSL Budget - 2,500 - 8,500 - 2,500Waterloo Township Roads Project 408 Western Area GoSL Budget - 20,000 - 8,000 - -Freetown City streets 408 Western Area GoSL Budget - 15,000 - 38,000 - 20,000Pademba Rd. - Jomo Kenyatta Rd. - Hillcot Rd. - Choitram - OAU Village 408 Western Area GoSL Budget - 35,000 - 55,000 - 40,000Rehabilitation of Tokeh-Lumely (Peninsular) Road 408 Western Area OFID/KFAED/

Abu Dhabi /GoSL Loan 44,000 15,000 50,000 40,000 45,000 35,000Rehabilitation of Roads in Rokel community (John Thorpe,Martin Salia and Kondolor Roads) Western Area GoSL Budget - - - - - -

Rehabilitation of Streets in Districts Headquarter towns and Selected Towns 408 - 62,000 - 98,500 - 74,000o/wRehabilitation/Reconstruction of Roads in Bo, Kenema, Makeni and

Magburaka Phases 1 and 11 408 Nationwide GoSL Budget - 15,000 - 35,000 - 30,000Rehabilitation/Reconstruction of Roads in Port Loko, Lunsar and Kambia408 P/Loko,Kambia,

Lunsar GoSL Budget - 12,000 - 14,000 - 8,000Rehabilitation/Reconstruction of Roads in Kono and Kabala 408 Kono,Kabala GoSL Budget - 15,000 - 15,000 - 15,000Kailahun Township Roads Project 408 Kailahun GoSL Budget - 10,000 - 4,500 - 1,000Rehabilitation/Reconstruction of Roads in Moyamba, Pujehun,Mattru Jong and Bonthe 408 South GoSL Budget - 10,000 - 30,000 - 20,000

National Protective Area Authority 410 1,000 1,750 - 1,750 - 1,750Sierra Leone Housing Cooperation(SALHOC) 408 - 1,500 - 2,500 - 1,500

Promoting the production of local building materials and youth economic empowerment in Sierra Leone 408 Nationwide GoSL Budget - 1,500 - 2,500 - 1,500

5 GOVERNANCE, JUSTICE AND SECURITY SECTOR 1,000 100,900 1,500 162,400 1,500 129,850Sierra Leone Correctional Service(SLCS) 207 - 2,600 - 2,600 - 2,600

Rehabilitation/Reconstruction of Correctional Services Buildings 207 Nationwide GoSL Budget - 2,600 - 2,600 - 2,600National Civil Registration Authority (NCRA) 203 - 95,300 - 150,000 - 120,000

Intergrated National Civil Registration System Project 203 Nationwide GoSL Budget - 95,300 - 150,000 - 120,000Sierra Leone Police(SLP) 206 - 2,200 - 9,000 - 6,450

Construction of Administrative Building(Police Academy) 206 Western Area GoSL Budget - 600 - 1,500 - 1,000Construction of Ross Road Regional HQ 206 Western Area GoSL Budget - 200 - 1,000 - 1,200Construction of Laboratory/Workshop& Academic Buiding 206 western Area GoSL Budget - 400 - 1,200 - 800Construction of APOTS, Samu 206 North GoSL Budget - 400 - 1,000 - 1,000Construction of Aberdeen Divisional HQ 206 Western Area GoSL Budget - 100 - 800 - 1,200Construction of Wilberforce Police Station 206 Western Area GoSL Budget - 200 - 2,000 - 500Construction of Bamoi Luma Police Station 206 Nationwide GoSL Budget - 100 - 1,000 - 500Construction of Jimmy Gbagbo Police Station 206 Nationwide GoSL Budget - 200 - 500 - 250

National Drug Law Enforcement Agency 212 - 200 - 200 - 200Support to National Drug Law Enforcement Agency 212 Nationwide GoSL Budget - 200 - 200 - 200

Law Officers Department 124 1,000 600 1,500 600 1,500 600Support to Access to Security and Justice Programme 124 Nationwide GoSL Budget - 200 - 200 - 200OARG Modernisation Project 124 Nationwide GoSL Budget - 200 - 200 - 200Technical Grant Capacity Building for the Law Reform Commission 124 Nationwide IDB/GoSL Grant 500 100 500 100 500 100The Establishment of a Legal framework for Alternative dispute Resolution in Sierra Leone 124 Nationwide IDB/GoSL Grant 500 100 1,000 100 1,000 100

C Funds and Grants Provisions - 50,100 - 30,100 - 30,100Local Government Development Grant Transfers 701 Nationwide GoSL Budget - 15,000 - 10,000 - 10,000Infrastructural Development Fund 129 Nationwide GoSL Budget - 10,000 - - - -Project Preparation Fund (PPF) 129 Nationwide GoSL Budget - 15,000 - 10,000 - 10,000Constituency Development Fund (CDF) 116 Nationwide GoSL Budget - 10,100 - 10,100 - 10,100

GRAND TOTAL 1,409,000 1,046,000 1,519,000 1,395,000 1,756,000 1,767,000


FY 2018 FY 2019 FY 2020


xxix

ANNEX 5a -FY2018–2020 PAYROLL BUDGET SUMMARY BY CATEGORY (Including Employer’s Contribution to Social Security)In Millions of Leones

FY2018 FY2019 FY2020Particulars Budget Indicative Indicative

Civil Service 735,464 855,651 988,301o/w:

Judiciary 13,428 15,622 18,044Finance and Economic Development 59,570 69,304 80,049Correctional Services 24,220 28,177 32,546Education Staff 8,500 9,889 11,422Health Workers 183,826 213,866 247,022Agriculture 16,232 18,885 21,812Works, Housing and Infrastructure 2,685 3,124 3,608Others 427,004 496,783 573,798

Charged Emoluments 86,433 100,557 116,146Teachers 565,021 657,354 759,263Police 155,140 180,493 208,474Military - Joint Force Command 126,653 147,350 170,194Foreign Missions 137,282 159,716 184,477Subvented Institutions 124,310 144,624 167,045

o/w:Audit Service Sierra Leone 19,691 22,908 26,460Anti-Corruption Commission 30,369 35,332 40,810National Electoral Commission 11,917 13,864 16,014Others 62,333 72,520 83,762

Local Councils 13,124 15,268 17,635Pensions, Gratuities and Other Retirement Benefits 107,530 125,102 144,497Wages Arrears 1,908 2,001 3,001Unallocated Personnel Emoluments 16,843 19,596 22,634

Grand Total 2,069,708 2,407,713 2,781,667

Wages and Salaries - (In Budget Profile) 2,067,800 2,405,712 2,778,666

xxx

101 Charged Emolument 228 - - 228 6,732 86,433 29.52 - - - - 86,433105 Ministry of Political and Public Affairs 82 6 - 88 275 3,528 3.12 - - 120 - 3,648106 Office of the Chief of Staff 107 - - 107 1,392 17,873 13.01 - - - - 17,873107 Ministry of Local Government & Rural Development 404 27 16 415 1,455 18,686 3.51 - - 608 673 18,621108 Sierra Leone Small Arms Commission 15 - - 15 206 2,639 13.70 - - - - 2,639110 Office of the Secretary to the President 361 11 1 371 1,154 14,823 3.11 44,022 - 220 37 59,028112 Office of the Secretary to the Vice President 55 8 - 63 282 3,622 4.48 - - 230 - 3,852116 Parliamentary Service Commission 123 - - 123 2,441 31,344 19.85 - - - - 31,344117 Cabinet Secretariat 25 10 - 35 188 2,413 5.37 - - 345 - 2,758118 Supreme Court 3 - 1 2 3 37 1.46 - - - 17 20119 Court of Appeal 15 - 1 14 13 172 0.96 - - - 11 161

120 High Court 243 23 2 264 995 12,781 3.77 - - 557 90 13,247121 Audit Service Sierra Leone - - - - - - - 19,691 - - - 19,691122 Human Resource Management Office 156 15 2 169 717 9,211 4.24 - - 409 102 9,518123 Public Service Commission 35 - - 35360 4,619 10.28 - - - - 4,619124 Law Officers’ Department 219 10 1 228 1,643 21,099 7.21 5,115 - 463 86 26,590125 Local Courts - 14 - 14 56 719 4.00 - - 360 - 1,079126 Independent Police Complaints Board 11 7 - 18 92 1,176 5.09 - - 229 - 1,405128 Ministry of Foreign Affairs & International

Co-operation 120 10 - 130 696 8,939 5.36 - 137,282 344 - 146,565129 Ministry of Finance and Economic Development 447 20 6 461 3,391 43,535 7.35 15,620 - 944 530 59,570130 National Revenue Authority - - - - - - - - - - - -131 Revenue Appellate Board 12 - - 12 190 2,440 15.84 - - - - 2,440

132 Accountant General’s Department 211 15 4 222 1,069 13,732 4.82 - - 464 231 13,964133 Ministry of Information and Communications 264 5 1 268 1,599 20,532 5.97 - - 192 72 20,652134 National Electoral Commission of Sierra Leone - - - - - - - 11,917 - - - 11,917137 National Commission for Democracy 56 - - 56 407 5,231 7.28 - - - - 5,231138 Statistics Sierra Leone 317 - - 317 971 12,467 3.06 - - - - 12,467139 National Commission for Privatisation 26 - - 26 253 3,247 9.73 - - - - 3,247140 Mass Media Services (SLBC Staff) 257 - - 257 786 10,098 3.06 - - - - 10,098141 Government Printing Department 81 9 - 90 62 796 0.69 - - 40 - 836142 National Public Procurement Authority 47 - - 47 254 3,265 5.41 - - - - 3,265143 Justice and Legal Service Commission - 10 - 10 30 385 3.00 - - 193 - 578144 National Commission for Human Rights 61 - - 61 648 8,323 10.63 - - - - 8,323145 Rights to Access Information Commission 16 - - 16 185 2,379 11.58 - - - - 2,379201 Ministry of Defence: 7,963 600 98 8,465 9,266 118,979 1.18 - - 9,057 1,383 126,653

Civil Servants 583 - - 583 - - - - - - - -Military 7,380 600 98 7,882 9,266 118,979 1.18 - - 9,057 1,383 126,653

203 National Civil Registration Authority - 329 - 329 1,747 22,431 - - - - - 22,431205 Ministry of Internal Affairs 112 18 - 130 109 1,396 0.84 - - 97 - 1,493206 Sierra Leone Police 11,115 1,000 88 12,027 11,226 144,141 0.93 - - 11,985 986 155,140207 Sierra Leone Correctional Services 1,361 582 8 1,935 1,454 18,675 0.75 - - 5,617 72 24,220208 National Fire Authority 294 200 1 493 343 4,400 0.70 - - 1,785 8 6,177209 Central Intelligence and Security Unit 77 - - 77 587 7,537 7.62 - - - - 7,537210 Office of National Security 159 - - 159 1,011 12,977 6.36 - - - - 12,977211 Immigration Department 230 40 1 269 175 2,251 0.65 - - 167 8 2,410

ANNEX 5b - FY2018 PAYROLL BUDGET SUMMARY BY MDA (Including Social Security Contributions)In Millions of Leones

No. of Projected Projected Projected Average Average Average Salary Other Provision Reduct- TotalCode Ministry/Department/ Workforce Number of Number of Workforce Monthly Annual Monthly Grants Allowa- for Increase ion

Agency as @ Recruit- Wastages for Gross Pay Gross Pay Gross Pay nces Numbers Due toAug.- ment FY2018 Per Worker Wastages

2017/1

xxxi

212 National Drugs Law Enforcement Agency 26 - - 26 88 1,135 3.40 - - - - 1,135301 301Ministry of Education, Science and

Technology 32,126 1,890 1,424 32,592 35,377 454,245 2.33 - - 137,789 18,513 573,521Education Staff 402 90 4 488 610 7,838 1.25 - - 723 60 8,500Teachers 31,724 1,800 1,420 32,104 34,767 446,408 1.08 - - 137,067 18,453 565,021

302 Ministry of Sports 122 4 - 126 279 3,585 2.22 - - 57 - 3,642303 Ministry of Tourism and Cultural Affairs 44 19 - 63 33 425 0.53 - - 64 - 489304 Ministry of Health and Sanitation 9,566 1,200 59 10,707 12,574 161,450 1.17 - - 23,207 831 183,826305 Ministry of Social Welfare, Gender &

Children’s Affairs 265 - 4 261 590 7,578 2.26 - - - 109 7,469306 Ministry of Lands, Country Planning

and the Environment 239 6 2 243 234 3,009 0.96 - - 37 23 3,023307 National Medical Supplies Agency - 8 - 8 40 514 5.00 - - 257 - 770308 National Commission for Social Action 85 - - 85 425 5,462 5.00 - - - - 5,462309 Dental and Medical Board - - - - - - - - - - - -310 Ministry of Youth Affairs 31 7 - 38 223 2,862 5.87 - - 264 - 3,126311 Health Service Commission 9 - - 9 120 1,542 13.34 - - 1,542312 Teaching Service Commission - - - - 311 4,000 - - - 4,000313 National Youth Service - 12 - 12 48 616 4.00 308 - 924314 National HIV and AIDS Commission - 20 20 140 1,798 - - - 1,798315 Teaching Hospitals Complex Administration - 30 30 150 1,926 - - - 1,926316 Civil Service Training College - 28 28 100 1,284 - - - 1,284341 Pensions, Gratuities and Retirement Benefits - - - - 11,599 107,530 - - - - - 107,530342 Government’s Contribution to Social Security - - - - 11,342 - - - - - - -345 Pharmacy Board Services 63 - - 63 508 6,523 8.06 - - 1,917 - 8,440401 Ministry of Agriculture, Forestry and Food Security 1,077 50 22 1,105 1,259 16,166 1.14 - - 367 301 16,232402 Ministry of Fisheries and Marine Resources 79 27 1 105 82 1,051 0.78 - - 135 9 1,177403 Ministry of Mines and Mineral Resources 237 8 1 244 133 1,702 0.54 21,660 - 28 7 23,384404 Ministry of Transport and Aviation 109 3 - 112 283 3,634 2.53 2,535 - 49 - 6,218405 Ministry of Tourism and Cultural Affairs

(National Tourist Board and Relics Commission) 183 - - 183 480 6,166 2.62 942 - - - 7,108406 Ministry of Energy 130 15 - 145 269 3,452 1.85 - - 3,356 - 6,808407 Ministry of Employment Labour and Social Security 101 19 1 119 326 4,182 2.74 - - 334 33 4,482408 Ministry of Works, Housing and Infrastructure 286 32 3 315 201 2,577 0.64 - - 131 23 2,685409 Ministry of Trade and Industry 285 17 3 299 594 7,623 1.99 2,808 - 217 71 10,577410 National Protected Area Authority 323 - - 323 772 9,907 2.39 - - - 9,907411 Road Maintenance Fund Administration

(SLRA Staff) 505 - - 505 2,238 28,738 4.43 - - - - 28,738412 National Telecommunications Commission - - - - - - - - - - - -413 Sierra Leone Electricity and Water Regulatory

Commission 15 - - 15 161 2,065 10.72 - 1,655 - 3,720414 Ministry of Water Resources 186 10 - 196 699 8,979 3.57 - - 229 - 9,208415 Sierra Leone Maritime Administration - - - - - - - - - - - -416 Civil Aviation Authority 46 - - 46 607 7,794 13.20 - - - - 7,794417 Nuclear Safety and Radiation Protection Authority 34 - - 34 136 1,743 3.99 - - 1,297 - 3,040




2017/1

xxxii

418 Sierra Leone Agricultural Research Institute 550 - - 550 1,440 18,490 2.62 - - - - 18,490420 Sierra Leone Environment Protection Agency - - - - - - - - - - - -421 Small and Medium Enterprises Development Agency

(SMEDA) - 40 - 40 320 4,109 - - - 4,109422 Sierra Leone Meteorological Agency 15 15 90 1,156 - - - 1,156501 Unallocated Personnel Emoluments 1 - - 1 113 1,454 113.27 - - 15,389 - 16,843701 Transfers to Local Councils - 60 - 60 851 10,932 5.69 - - 2,192 - 13,124

Grand Total 72,031 6,490 1,751 76,770 139,702 1,606,736 474.32 124,310 137,282 223,700 24,228 2,067,800

Civil Service, Subvented Institutions and Others 21,812 3,090 145 24,757 84,443 897,209 471.13 124,310 137,282 65,592 3,406 1,220,986Military 7,380 600 98 7,882 9,266 118,979 1.18 - - 9,057 1,383 126,653Teachers 31,724 1,800 1,420 32,104 34,767 446,408 1.08 - - 137,067 18,453 565,021Police 11,115 1,000 88 12,027 11,226 144,141 0.93 - - 11,985 986 155,140

Total 72,031 6,490 1,751 76,770 139,702 1,606,736 474.32 124,310 137,282 223,700 24,228 2,067,800




2017/1

xxxiii

ANNEX 5C–FY2018 BUDGET PAYROLL SUMMARY BY FOREIGN MISSION

In Millions of Leones

Gross Average Monthly Pay FY 2018 FY 2019 FY 2020Budget Indicative Indicative

Missions Account Description £ $ € Le Le LeCode

1. LONDON 111 Salaries 72,490 9,905 9,905 9,905

72,490 - - 9,905 9,905 9,905

2. NEW YORK 111 Salaries 139,766 7,722 7,722 7,722

- 139,766 - 7,722 7,722 7,722

3. ABUJA 111 Salaries 51,231 4,050 4,050 4,050

- 51,231 - 4,050 4,050 4,050

4. MONROVIA 111 Salaries 53,693 4,808 4,808 4,808

- 53,693 - 4,808 4,808 4,808

5. CONAKRY 111 Salaries 26,758 4,040 4,040 4,040

- 26,758 - 4,040 4,040 4,040

6. WASHINGTON 111 Salaries 119,620 10,566 10,566 10,566

- 119,620 - 10,566 10,566 10,566

7. MOSCOW 111 Salaries 49,180 4,545 4,545 4,545

- 49,180 - 4,545 4,545 4,545

8. ADDIS ABABA 111 Salaries 64,087 7,351 7,351 7,351

- 64,087 - 7,351 7,351 7,351

9. BEIJING 111 Salaries 70,389 7,350 7,350 7,350

- 70,389 - 7,350 7,350 7,350

10. BANJUL 111 Salaries 32,358 10,668 10,668 10,668

- 32,358 - 10,668 10,668 10,668

11. BRUSSELS 111 Salaries 73,447 7,834 7,834 7,834

- - 73,447 7,834 7,834 7,834

12. SAUDI ARABIA 111 Salaries 71,225 6,457 6,457 6,457

- 71,225 - 6,457 6,457 6,457

xxxiv

13. BERLIN 111 Salaries 57,108 8,076 8,076 8,076

- - 57,108 8,076 8,076 8,076

14. IRAN 111 Salaries 37,150 3,368 3,368 3,368

- 37,150 - 3,368 3,368 3,368

15. ACCRA 111 Salaries 44,258 5,981 5,981 5,981

- 44,258 - 5,981 5,981 5,981

16. LIBYA 111 Salaries 38,156 2,570 2,570 2,570

- 38,156 - 2,570 2,570 2,570

17. KUWAIT 111 Salaries 36,619 4,061 4,061 4,061

- 36,619 - 4,061 4,061 4,061

18. DAKAR 111 Salaries 30,942 3,134 3,134 3,134

- 30,942 - 3,134 3,134 3,134

19. GENEVA 111 Salaries 38,997 11,320 11,320 11,320

- 38,997 - 11,320 11,320 11,320

20. SEOUL (new) 111 Salaries 55,940 5,345 5,345 5,345

- 55,940 - 5,345 5,345 5,345

21. DUBAI (new) 111 Salaries 49,708 8,130 8,130 8,130

- 49,708 - 8,130 8,130 8,130

GRAND TOTAL 72,490 1,010,077 130,555 137,282 137,282 137,282

ANNEX 5C–FY2018 BUDGET PAYROLL SUMMARY BY FOREIGN MISSION


Gross Average Monthly Pay FY 2018 FY 2019 FY 2020Budget Indicative Indicative

Missions Account Description £ $ € Le Le LeCode

xxxv

NNEX 5d -FY2018 PAYROLL BUDGET SUMMARY BY SUBVENTED AGENCY


Average Monthly FY2018 FY2019 FY2020Institution Dept. Code Way Bill Budget Indicative Indicative

Nos.

9 ANTI CORRUPTION COMMISSION 110 2,531 30,369 30,369 30,369

10 CORPORATE AFFAIRS COMMISSION 110 119 1,423 1,423 1,423 11 INDEPENDENT MEDIA COMMISSION 110 78 933 933 933 12 LAW REFORM COMMISSION 110 363 4,351 4,351 4,351 13 NATIONAL ASSETS COMMISSION 110 15 185 185 185 14 OFFICE OF THE OMBUDSMAN 110 277 3,326 3,326 3,326 17 PUBLIC SECTOR REFORM UNIT 110 146 1,753 1,753 1,753 18 SIERRA LEONE INSURANCE COMMISSION 110 140 1,682 1,682 1,682 21 AUDIT SERVICE SIERRA LEONE 121 1,641 19,691 19,691 19,691 24 LEGAL AID BOARD 124 426 5,115 5,115 5,115 28 FINANCIAL INTELLIGENCE UNIT 129 622 7,465 7,465 7,465 29 FISCAL DECENTRALIZATION LOCAL GOVT FINANCE (Decentralization Staff) 129 358 4,292 4,292 4,292 32 NATIONAL AUTHORISING OFFICE 129 322 3,863 3,863 3,863 36 NATIONAL ELECTORAL COMMISSION 134 993 11,917 11,917 11,917 62 NATIONAL MINERALS AGENCY 403 1,805 21,660 21,660 21,660 63 TRANSPORT INFRASTRUCTURAL DEVELOPMENT UNIT 404 211 2,535 2,535 2,535 64 MONUMENTS AND RELICS COMMISSION (Including Railway Museum) 405 78 942 942 942 69 SIERRA LEONE INVESTMENT & EXPORT PROMOTION AGENCY 409 159 1,904 1,904 1,904 70 SIERRA LEONE STANDARDS BUREAU 409 75 904 904 904

GRAND TOTAL 10,359 124,310 124,310 124,310

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Transfers to Local Councils 154,906.5 Transfers to LocalCouncils 131,858.9

Direct Transfers to Local Councils 129,654.2 Direct Transfers toLocal Councils 10,165.7 3,144.4 23,668.5 15,461.1 14,935.9 2,194.3 3,113.5 4,137.1 581.9 14,608.9 1,200.0 93,211.3

1 Administrative Grant 1,200.0 Bo District 639.6 - 1,554.9 841.7 - 143.3 203.3 221.5 - 761.8 79.4 4,445.5Support to Ward Committees 1,200.0 Bo City 436.4 171.2 452.1 417.2 - - - 127.4 - 533.4 9.2 2,146.9

2 Block Education Grant 10,155.7 Bombali District 671.5 - 1,844.4 960.9 - 242.1 343.5 266.9 - 849.7 82.4 5,261.4Administration 4,271.4 Makeni City 338.8 135.3 482.8 369.6 - - - 122.1 - 433.2 9.2 1,891.0Education Dev Grant 4,403.4 Bonthe District 312.3 107.4 947.9 623.8 - 100.0 141.9 138.5 105.9 437.9 55.0 2,970.6Science Equipments 1,480.9 Bonthe Municipal 169.9 68.3 385.0 264.0 826.4 - - 48.9 39.4 211.1 9.2 2,022.2

3 Library Services 3,144.6 Freetown 1,050.0 757.9 603.2 1,289.4 4,397.0 - - 509.4 53.2 2,292.9 149.6 11,102.64 School Fees Subsidy 23,647.6 o/w: Rokupa Hospital - - - - 1,306.8 - - - - - 1,306.85 Unconditional Block Grant 15,190.1 Lumley Hospital - - - - 906.4 - - - - - 906.4

Solid Waste Management 6,849.0 King Harman Road - - - - 1,475.2 - - - - - 1,475.2Fire Prevention 939.9 Macauley Street - - - - 708.6 - - - - - 708.6Youths and Sports 2,083.3 Kailahun District 556.6 226.5 1,707.6 1,289.8 1,132.3 178.9 253.8 288.5 - 968.6 88.5 6,691.1Fisheries and Marine Resources 582.0 Kambia District 530.8 169.9 1,346.9 928.2 944.9 172.0 244.0 209.7 61.5 665.1 76.3 5,349.3Other Recurrent Administrative Expenses 4,735.9 Kenema District 483.8 - 1,648.1 855.5 - 146.9 208.4 234.5 - 791.5 88.5 4,457.2

6 Social Welfare, Gender and Children's Affairs 4,137.2 Kenema City 409.4 172.1 487.7 443.5 - - - 144.8 - 584.6 9.2 2,251.37 Health Care Services 30,396.8 Koinadugu District 553.5 146.3 2,379.5 1,056.4 1,318.6 178.9 253.8 216.2 - 744.6 73.3 6,921.0

Primary Health Care services (PHC) 15,460.9 Kono District 503.0 - 1,566.2 995.9 - 162.9 231.1 211.3 - 735.2 73.3 4,478.8Secondary Health Services

( District Hospitals) 14,935.9 Koidu New Sembehun 366.0 115.2 453.1 371.6 1,265.8 - - 97.1 - 450.9 9.2 3,128.98 Agriculture and Food Security 23,668.6 Moyamba District 561.1 165.0 1,617.4 718.9 1,058.3 134.0 190.1 200.4 78.3 623.0 73.3 5,419.79 Rural Water Services 3,113.6 Port Loko District 836.8 254.1 2,062.2 1,160.8 1,804.0 254.1 360.6 353.1 69.9 1,045.8 103.8 8,305.3

10 Local Government Development Grant 15,000.0 Pujehun District 442.1 150.3 1,255.8 932.0 801.4 129.6 183.9 223.6 92.6 665.1 67.2 4,943.6Tonkolili District 699.8 217.9 1,940.6 1,036.5 1,387.2 199.6 283.2 285.1 - 931.8 82.4 7,064.1Western Area District 604.3 287.0 933.1 905.4 - 152.2 215.9 238.1 81.1 882.7 61.1 4,360.8In-Kind (Indirect)Transfers to Local Councils 25,252.3 In-Kind (Indirect)

Transfers to Local Councils 38,647.62.1 Education 25,252.3 School Fees Subsidy 23,647.6

Primary Education 13,468.2 Local Gov't Dev't Grant 15,000.0Text Books 4,303.6Teach & Learning Materials 3,287.4Examination Fees to WAEC-NPSE 5,877.2

Secondary Education 11,784.1Text Books 2,769.9Examination Fees to WAEC-BECE 9,014.2

ANNEX 6: FY 2018 TRANSFERS TO LOCAL COUNCILSIn Millions of Leones

Unconditional Support to Local Council FY2018 Local Library Primary Secondary Total Rural Social Block Ward

No. Grant Type Budget Council Council Education Services Agriculture Health Health Health Water Welfare Grant committees Transfers

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ANNEX 7a -PROJECTED EXTERNAL DEBT STOCK, 2017 TO 2022In Millions of Leones

Jun- 17 2018 2019 2020 2021 2022In Millions of US$

Total External Debt 1,469.46 1,671.52 1,758.82 1,751.73 1,733.57 1,679.87

Multilateral 1,095.76 1,265.39 1,324.16 1,295.42 1,266.35 1,217.17World Bank 244.52 285.78 304.30 311.06 307.67 301.32IMF 367.10 418.00 426.36 383.72 376.05 361.01ADB 131.22 146.75 155.02 161.11 159.56 157.85IFAD 42.29 42.55 42.64 42.13 40.71 39.28IDB 114.95 141.73 152.43 153.91 147.32 136.68EEC/EIB 44.12 65.46 78.55 82.48 83.31 81.64BADEA 49.77 58.45 60.02 60.95 59.64 57.77OFID 49.65 64.14 65.87 64.71 60.38 53.56EBID 52.15 42.53 38.96 35.33 31.70 28.07

Bilaterals 174.85 219.91 255.94 285.09 303.50 306.48China 13.81 4.72 4.42 4.13 3.54 2.95Exim Bank of China 38.97 34.68 31.80 28.72 25.64 22.57Kuwait Fund 49.21 56.70 62.85 64.22 62.59 58.95Saudi Fund 19.30 35.57 45.98 56.28 60.91 59.92Exim Bank of India 38.21 57.59 70.26 82.92 95.59 100.45Exim Bank of Korea 10.75 21.81 29.18 36.55 43.93 51.30Abu Dhabi 4.62 8.84 11.45 12.26 11.30 10.34

Comme rc ial 198.85 186.22 178.72 171.22 163.72 156.22

Domestic Debt (in Billion Le) /1 4,328.00 4,760.80 5,379.70 5,971.47 6,628.33 7,158.60

1/ These are marketable Treasury bills and Non-marketable Treasury bonds held by the Bank of Sierra Leone

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ANNEX 7b - GUARANTEES ISSUED BY GOVERNMENT AS AT 30 SEPTEMBER 2017In Millions of Leones

Name of SOEs Year of Guarantee Amount

Njala University College 2016 2,500Sierra Leone State Lottery 2016 1,000Sierra Leone Postal Services Ltd(SALPOST) 2015 884Guma Valley Water Company 2013 2,164National Hajj Committee/1 2016 15,000Road Maintenance Fund Administration 2016 50,000Energy Sector/2 2016 30,750

Total 102,298

Note:

1/ US$2.0 million loan was granted by SLCB to support 2016 Hajj Scholarship activities2/ Under the Western Area Power Generation Project, funded by DFIs, Government guaranteed to provide budget support to fill financing gap annually

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ANNEX 7c - PROJECTED EXTERNAL DEBT SERVICE PAYMENTS, 2017 TO 2021

(In Thousand of USD)Creditors/International Financial Institutions

2017 2018 2019 2020 2021PR INT PR INT PR INT PR INT PR INT

IDA 1,980.5 1,755.2 2,044.7 1,944.9 2,272.0 2,166.8 3,034.4 2,301.5 3,867.4 2,330.9IMF 12,999.6 60.3 19,115.0 75.4 20,315.6 23.5 31,556.2 0.1 47,116.1 -ADB 743.1 1,252.8 910.9 1,064.3 959.4 1,133.1 1,579.9 1,196.8 1,579.9 1,240.9IFAD 1,074.0 479.8 1,095.0 347.5 1,095.1 346.8 1,095.1 346.2 1,418.6 338.3IDB 4,919.3 1,265.5 8,015.7 1,863.9 9,178.3 1,757.4 13,095.4 1,614.1 13,095.4 1,482.8EIB 653.0 33.3 653.0 902.1 1,192.3 872.2 2,384.6 839.2 2,384.6 789.8BADEA 682.5 127.0 947.2 87.8 951.1 145.7 1,062.0 168.1 1,301.9 182.6OFID 4,483.9 1,295.8 6,160.6 912.9 6,160.7 1,123.4 6,160.7 1,191.1 6,827.3 1,172.3EBID 2,609.2 1,566.9 3,629.8 1,252.9 3,629.7 1,159.2 3,629.7 1,060.5 3,629.7 958.3Multilateral Total 30,145.0 7,836.6 42,571.9 8,451.7 45,754.2 8,728.1 63,598.0 8,717.6 81,220.9 8,495.9

- -China EXIM Bank 3,141.2 824.0 3,077.6 744.9 3,077.6 687.8 3,077.6 630.5 3,077.6 566.4Govt. of China 602.8 - 910.7 - 1,218.5 - 1,821.4 -India EXIM Bank 1,967.7 687.6 2,935.4 774.2 2,935.5 962.2 2,935.5 1,150.5 2,935.5 1,332.5Korea EXIM Bank - 0.9 - 1.6 - 2.4 - 3.1 - 3.9Kuwait Fund 2,004.5 641.9 2,688.4 860.1 2,688.4 968.3 2,688.4 1,038.8 3,678.3 1,063.3Saudi Fund 454.0 233.6 657.1 276.2 912.2 382.4 952.1 487.5 992.1 588.6Abu Dhabi Fund 666.7 376.6 362.6 104.4 662.3 162.5 962.0 212.3 962.0 241.5

Bilateral Total 8,234.1 2,764.6 10,323.9 2,761.4 11,186.7 3,165.6 11,834.1 3,522.7 13,466.9 3,796.2

Commerc ial 7,225.0 - 7,500.0 - 7,500.0 - 7,500.0 - 7,500.0 -

Grand Total 45,604.1 10,601.2 60,395.8 11,213.1 64,440.9 11,893.7 82,932.1 12,240.3 102,187.8 12,292.1Grand Total (Excluding IMF Prin.) 32,604.6 10,540.9 41,280.8 11,137.7 44,125.3 11,870.2 51,375.9 12,240.2 55,071.7 12,292.1

TABLE OF CONTENTS

I. INTRODUCTIONII. FISCAL STRATEGY AND OBJECTIVESIII. RECENT ECONOMIC TRENDS AND OUTLOOK3.1 Global Economic Developments, Outlook and Risks3.2 Domestic Macroeconomic Developments, 2015-20173.3 Medium-term Macroeconomic Forecasts (2018 - 2020)3.3.1 Gross Domestic Product3.3.2 Inflation3.3.3 Money Supply3.3.4 Exchange rate3.3.5 Exports3.3.6 Imports3.3.7 Current Account3.3.8 Balance of Payments3.4 Comparison Between 2017 Outturns and ProjectionsIV. FISCAL POLICY4.1 Fiscal Developments: 2015-20164.1.1 Domestic Revenue Performance4.1.2 Grants4.1.3 Government Expenditures4.1.4 Budget Deficit and Financing4.2 Fiscal Developments in 20174.3 Medium-Term Fiscal Forecasts, 2018- 20204.3.1 Domestic Revenue projections4.3.2 Grants4.2.3 Domestic Revenue Mobilisation Measures: 2018-20204.3.4 Expenditure Projections: 2018-20204.4 Expenditure Management and Control Measures4.3.1 Recurrent Expenditure

V.MEDIUM-TERM EXPENDITURE FRAMEWORK (MTEF) CEILINGS AND EXPENDITUREPRIORITIES

5.1 Non-Salary, Non-Interest (NSNI) Recurrent Expenditure5.2 Domestic Capital Expenditure: 2018-20205.3 2017 Fiscal Outturns versus Projections

VI. FISCAL RISKS STATEMENT 476.1 Broad Classification of Fiscal Risks6.2. Types of Fiscal Risks6.2.1 General Macroeconomic Risks6.2.2 Specific Fiscal Risks6.2.3 Institutional Capacity Risks6.3 Risk Analysis6.4 Risk Mitigating Measures

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I. INTRODUCTION.

1.The preparation of the 2018 Fiscal Strategy Statement (FSS) is in compliance withSection 23(1) of the PFM Act, 2016. As in the case of the 2017 FSS, the 2018 FSS providesa detailed description of Government's fiscal objectives as well as an assessment offiscal risks for the next three years. The macro-fiscal forecasts contained in the FSSare based on forecasts produced by the Macro-Fiscal Working Group of the Governmentand agreed with the International Monetary Fund (IMF) Country Team during thenegotiations for the new Extended Credit Facility (ECF) arrangement with the IMF inApril 2017.

2.The rest of the paper is organized as follows. Section 2 presents the Government'sfiscal strategy and objectives; Section 3 provides an overview of recent economicdevelopments as well as outlook for the global and domestic economy; Section 4 outlinesGovernment's fiscal policy, including a review of fiscal developments during 2015-2017;This section also discusses the medium-term fiscal forecasts; as well as expendituremanagement and control measures. Section 5 presents the Medium-Term ExpenditureFramework; detailing expenditure ceilings, both for recurrent and domestic capital forthe medium-term. Finally, section 6 assesses the impact of fiscal risks, includingmacroeconomic and specific fiscal risks and their mitigating measures.

II. FISCAL STRATEGY AND OBJECTIVES

3. The key objective of fiscal policy in the medium-term is to maintainmacroeconomic stability by focusing on the consolidation of public finances throughenhanced domestic revenue collection and rationalization of expenditures. Higherdomestic revenue collection will allow Government to continue to address infrastructurebottlenecks, promote economic diversification, and expand existing social protectionprogrammes to achieve inclusive growth and poverty reduction. This is consistent withthe principles of Responsible Financial Management as articulated in Section 20(2) ofthe Public Financial Management (PFM) Act, 2016.

4. In this regard, Government will seek to reduce the overall budget deficit,including grants, from 7.0 percent of GDP in 2017 to 6.5 percent in 2018 and furtherdown to an average of 5.6 percent in 2019-2020. To achieve this objective, domesticrevenue collection will improve from 12.0 percent of GDP in 2017 to 13.2 percent ofGDP in 2018, 14.6 percent of GDP in 2019 and further up to 15.4 percent in 2020.Consequently, the actions and measures to achieve these are articulated in theDomestic Revenue Mobilization Strategy (RMS).

5. Total expenditure and net lending will amount to 21.6 percent of GDP in 2018from 21.3 percent during 2017. A key feature of public expenditure management is tomaintain a clean Government payroll. The aim is to keep the wage bill at a sustainablelevel of 6 percent of GDP from 2018 onwards, from 6.3 percent of GDP in 2017. Thus,in nominal terms, the Government Wage bill will increase from Le1.83 trillion in 2017to Le 2.1 trillion during 2018, consistent with an increase in nominal GDP. Thedomestic primary deficit will be reduced from 4.5 percent of GDP in 2017 to 4.0 percentin 2018 and further down to 2.1 percent of GDP in 2020.

3

6. To maintain debt sustainability consistent with our obligations under theECOWAS macroeconomic convergence criteria for the monetary union, public debt willnot exceed the debt sustainability threshold of 40 percent of GDP in present value (PV)terms and 70 percent of GDP in nominal terms.

III. RECENT ECONOMIC TRENDS AND OUTLOOK3.1 Global Economic Developments, Outlook and Risks

7. The global economy experienced several challenges in 2016, including weakgrowth in advanced economies, especially the United States, the United KingdomBrexit vote to leave the European Union, lingering impact of the fall in commodity pricesand China's shift from investment and exports to consumption and services as wellas geopolitical uncertainty. Despite this, the global economy is estimated to have grownby 3.1 percent in 2016 compared to 3.2 percent in 2015.

8. World inflation remained low in 2016 supported by low commodity prices.Inflation remained subdued in Advanced, Emerging markets and developing economiesin 2016 due to weak demand. In Sub-Saharan Africa, inflationary pressures remainedhigh due to the sharp depreciation of domestic currencies across the region.

9. The global outlook improved in 2017 but uncertainty remains high. The globaleconomy is estimated to grow by 3.5 percent in 2017 and further by 3.6 percent in 2018due to the recovery in Emerging market economies as financial sentiments towardsthese economies improve. China's growth is expected to remain reliably high in themedium-term, with a growth forecast of 6.7 percent in 2017, and averaging 6.4 percentover 2018-20. Growth in India continued to be resilient at 6.8 percent in 2016. India'seconomy is benefitting from a large improvement in terms of trade, effective policyactions and stronger external buffers.

10. In Sub-Saharan Africa, growth fell across the board in 2016 with an averagegrowth rate of 1.4 percent, as about two-thirds of the countries in the regionexperienced a slowdown. A range of external conditions, including a drop in commodityprices, deterioration in terms of trade, and severe climatic conditions causing droughtand famine as well as difficult domestic political conditions prompted the decline ingrowth.

11. In 2017, prospects are expected to improve as average growth in the region isestimated projected at 2.6 percent. This modest growth rebound is mainly driven bythree large countries: recovery in oil production in Nigeria, higher public spendingahead of the elections in Angola, and the fading of drought effects in South Africa.

12. The encouraging outlook as described above for the global economy is maskedwith significant risks. For advanced economies, low productivity growth, high incomeinequality and populist sentiments will continue to increase likelihood of protectionistand nationalistic policies which could threaten the global economic cooperation,reducing cross-border trade and investment. In emerging and developing economies,persistent structural issues may challenge growth. Geopolitical tensions, domesticpolitical dissent, increased risks of severe climate incidents as well as terrorismconcerns will also contribute to the uncertainty of the outlook.

4

3.2 Domestic Macroeconomic Developments, 2015-2017

13. The twin shocks of the Ebola epidemic and the collapse of iron ore prices,adversely affected the performance of the economy during 2015. The economycontracted by 20.5 percent after slowing down to 4.6 percent in 2014 from 20.7 percentin 2013. Despite this contraction, the economy proved resilient and recovered stronglyin 2016. It grew by 6.1 percent following the resumption of iron ore mining combinedwith the implementation of sound economic policies. Excluding iron ore, the economygrew by 4.3 percent in 2016 attributed largely to an increase in economic activities,the return to normal activities in the agriculture, construction, trade, manufacturing,and services sectors, including transport and tourism supported by improved electricitygeneration and distribution. Overall, GDP is projected to grow further by 5.6 percentin 2017 with non-iron ore GDP growing by 3.5 percent.

14. After remaining at single digits throughout 2015 and the first half of 2016,inflation jumped to double digit in July 2016. For the first quarter of 2017, it peakedat 20.2 percent in March 2017 from 8.4 percent in December 2015. The increase ininflation largely reflects the sharp depreciation of the exchange rate during the periodand the one-off increase in domestic pump prices of fuel products in November 2016.Inflationary pressures moderated during the second quarter of 2017 and furtherdeclined to 18.1 percent in August and 17.8 percent in September, 2017 as theexchange rate stabilizes and the impact of the fuel price increase fades away. The tightmonetary policy stance adopted by the Bank of Sierra Leone (BSL) during the first halfof 2017 also contributed to the decline in inflation. The BSL increased the monetarypolicy rate to 11 percent in March 2017 and further to 13 percent in June 2017 from9.5 percent during the first half of 2016.

13. Domestic revenue collection was adversely affected by the contractionaryeffects of the twin shocks on the economy during 2014 and 2015. Domestic revenuecollected decreased to 10.8 percent of GDP in 2014 and remained at the same levelin 2015.

14. However, for 2016, domestic revenue collection increased to 12.1 percent ofGDP in 2016, largely due to a one-off revenues collection in the form of capital gainstax from the sale of Airtel, the take-over of Sierra Rutile by Aluka, and the removalof fuel subsidies in November 2016. Excluding the capital gains tax received, domesticrevenue was estimated at 11.1 percent of GDP in 2016. Government also implementedvarious revenue enhancing measures during the period including the introduction ofGoods and Services Tax (GST) on electricity; higher import duty on water, sugary andjuice drinks, cigarette and other tobacco products. The presumptive tax rates forcommercial vehicles and motor bikes were also revised. Total expenditure increasedto 20.8 percent of GDP in 2015 from 19.5 percent of GDP in 2014 and further to 23.2percent of GDP in 2016.

15. Consequently, the overall budget deficit, including grants, increased to 4.6percent of GDP in 2015, and further to 8.1 percent of GDP in 2016 from 4.0 percent ofGDP in 2014.

5

Domestic revenue is also estimated at 12.1 percent of GDP in 2017. Total expendituresare estimated to moderate to 21.2 percent of GDP in 2017 as Government adoptsmeasures to consolidate its fiscal position, including aggressive domestic revenuemobilization and expenditure rationalisation, measures. The overall budget deficitincluding grants is estimated at 6.5 percent of GDP in 2017.

16. Broad money grew by 17.9 percent in 2016 compared to a growth rate of 4.9percent in 2015 and is projected to slow down to 11.3 percent by end 2017. Similarly,Reserve Money grew strongly by 23.9 percent in 2016 compared to 8.3 percent in 2015and is projected to moderate to 11.3 percent at end 2017.

17. Bank credit to the private sector continued to grow during the review periodby 9.1 percent in 2015, 16.7 percent in 2016 and is projected to moderate to 12.0 percentby end 2017. As a percentage of GDP, credit to the private sector remains relativelylow at an average of 5.3 percent compared to Sub-Saharan African average of 20 percent.

18. To support Government's economic recovery following the slump in 2015, themonetary policy stance of the BSL was initially kept neutral during the first half of 2016with the Monetary Policy Rate (MPR) maintained at 9.5 percent. In the second half of2016, monetary policy was challenged by the rise in inflation triggered by exchangerate depreciation and reinforced by the excess liquidity in the banking system. Inresponse to the heightening inflationary pressures, monetary policy was tightenedduring the second half of 2016.The MPR was raised to 10.5 percent in the third quarterand further to 11 percent in the fourth quarter of 2016.

19. The value of exports plummeted by 55.4 percent to US$581 million in 2015relative to US$1.3 billion in 2014, following the closure of the two iron ore miningprojects. The resumption of iron ore mining in February 2016 resulted in the recoveryof exports by 15.2 percent during 2016 as the value of exports increased to US$670million.

20.Total exports amounted to US$467 million for the first half of 2017 compared to theUS$ 291 million for the same period in 2016. Of this, iron ore exports amounted to US$99million; diamond, US$ 50.4 million; rutile, US$ 37 million; bauxite, US$ 29.5 millionand fish and shrimps, US$113.4 million.

21. The value of total imports (fob) decreased by 31 percent from US$1.6 billion in2014 to US$1.3 billion in 2015 and remained at that level in 2016. This was mainlydriven by the reduction in the value of petroleum imports from US$311 million in 2014to US$157 million in 2015. It slightly rose to US$187 million in 2016 due to bothreduction in volumes as iron ore mining ceased in 2015 and the fall in internationaloil prices. The importation of mining related machinery and transport equipment alsodecreased by 38 percent, from US$334.8 million in 2015 to US$206.9 million in 2016.Food imports amounted to US$298.7 million, a significant decrease compared toUS$528 million in 2015. Rice imports amounted to US$95.9 million in 2016.

6

22. Total imports amounted to US$ 737.4 million during the first half of 2017, about31 percent higher than imports for the same period in 2016. Food import amounted toUS$ 248 million, of which rice import was US$ 108.3 million; machinery and transportequipment; US$175 million and manufactured goods import, US$78.7 million. Totalimports are projected to reach US$ 1.4 billion by end of 2017.

23. The trade deficit widened to US$765 million in 2015 from US$333.9 million in2014, reflecting the 55.4 percent drop in exports (mostly iron ore), which more thanoffset the 18 percent drop in imports during the year. It however, improved slightly toUS$646 million in 2016 following the resumption of iron ore exports. Despite thisimprovement in the trade deficit, the current account deficit widened to 19.7 percentof GDP in 2016 due to the sharp drop in official transfers, including Ebola-relatedinflows from US$350 million in 2015 to US$208 million in 2016. The current accountis projected to deteriorate to 21.5 percent of GDP during 2017.

24. Gross foreign reserves of the Bank of Sierra Leone decreased from US$633million (4.1 months of imports) in 2014, to US$ 580 million (3.8 months of imports) in2015. In 2016, gross foreign reserves decreased further to US$503 million in 2016 (3.1months of imports). The decrease in reserves in 2016 was mainly due to an excess ofoutflows which more than outweighed the inflows during the year. The main sourcesof foreign inflows in 2016 were receipts from mineral exports as well as disbursementsof project and programme loans and grants by development partners. Significantoutflows were in respect of payments for various Government infrastructure projects,support to the private sector through the BSL weekly auction and debt service paymentto various creditors.

25. The exchange rate of the Leone to the US Dollar came under pressure during2015 to 2016. The fall in export earnings, coupled with the decline in Ebola-relateddonor inflows, reduced the supply of foreign exchange in the economy. The speculativebehaviour of market participants also contributed in putting further pressure on theexchange rate. Consequently, the end period exchange rate of the Leone to the USdollar depreciated by 27.6 percent to Le7,239.2 in December 2016 from Le5,639.1 inDecember 2015. The exchange rate of the Leone to the US Dollar has remainedrelatively stable during the first 9 months of 2017, depreciating by about 3.0 percent.

26. The stock of public and publicly guaranteed external debt amounted to US$1.36billion (37.2 percent of GDP) at end-2016 compared to US$1.24 billion (29.4 percent ofGDP) at end 2015. The increase was mainly driven by net inflows from multilateralcreditors particularly the International Monetary Fund (IMF) and the Islamic DevelopmentBank to support post-Ebola recovery as well as for building infrastructure. Debt owedto Multilateral, bilateral and commercial creditors amounted to US$ 974.3 million,US$173.7 million and US$200.7 million, respectively. The stock of domestic debt stoodat Le3.48 trillion representing 14.6 percent of GDP in 2014; comprising of Le2.84 trillionof marketable securities and Le648.25 billion of non-marketable treasury securities,compared to Le2.81 trillion at end 2015. The ratio of domestic debt to total debt hasbeen generally stable in recent years, with the portfolio concentrated in treasurysecurities, which accounts for about 80 percent of total domestic debt at end-2016.The remaining domestic debt comprised of the Government's overdraft facility (Ways

7

and Means Advances) at the Bank of Sierra Leone, verified domestic payments arrears,and non-negotiable, non-interest-bearing securities held by the BSL to meet statutorycapital requirements.

27. Total interest paid on domestic treasury securities increased to Le140.75billion in 2016 from Le134.85 billion in 2015 but was below the projected amount ofLe189.18 billion. The slight increase in 2016 was due to additional sale of securitiescombined with rise in interest rates on Treasury Bills, especially on the 364-daysecurities.

28. The stock of external debt is projected at US$1.5 billion end 2017, moving fromUS$1.3 billion end 2016. Domestic debt is projected to reach Le4.1 trillion by end of2017, an indicative increase of 14 percent, from a stock of Le3.6 trillion end 2016. Totalinterest payments in 2017 are estimated at Le 611.5 billion, rising from Le201.8 billionin 2016. The dramatic increase was influenced by the combination of rising domesticinterest rates and new borrowings in the domestic debt markets.

3.3Medium-term Macroeconomic Forecasts (2018 - 2020)

29. The key macroeconomic objectives over the medium term are: i) to safeguardmacroeconomic stability by reigning in inflation; improving foreign reserves position;and maintaining debt sustainability, (ii) promoting sustainable and inclusive growthby diversifying the economy through investments in agriculture, tourism, fisheries,and scaling up investment in infrastructure (roads, energy and water supply); (iii)increase social spending including on social safety nets to promote human development;iv) enhance domestic revenue mobilization.

3.3.1 Gross Domestic Product

30. Real GDP growth is projected to grow by 5.0 percent in 2018, to 6.2 percent in2019 and 6.8 percent in 2020. Excluding iron ore, growth will increase from 3.5 percentin during 2017 to 5.0 percent in 2018; 5.9 percent in 2019; and 6.6 percent in 2020.31.The sectoral GDP growth rates for the medium-term are provided in Table 3.1below:

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Table 3.1: Sectoral GDP Growth rates: 2015 to 2020

Annual percentage ChangeAgriculture, Forestry and Fishing 3.5 3.8 4.8 5.0 5.4 6.3

Crops 4.1 4.4 5.5 5.0 6.0 7.0 Livestock 1.9 2.9 3.5 5.0 4.5 5.0 Forestry 2.1 2.2 3.5 5.0 3.5 4.5 Fishery 2.1 2.7 2.8 5.0 4.0 4.5 Industry -77.3 27.4 16.1 8.3 10.6 10.8 Mining and Quarrying -88.0 52.5 24.9 11.2 13.4 12.8 Iron ore -99.9 7131.4 126. 7 5.6 15.8 18.2 Other Minerals -5.6 7.8 -18.2 17.9 10.9 7.0 Manufacturing and Handicraft 0.4 4.6 4.9 4.0 6.5 7.5 Electricity and Water Supply 5.9 4.4 5.9 4.0 6.0 7.5 Construction 5.1 6.7 5.1 4.0 6.0 7.0 Services 3.7 5.0 3.8 2.9 6.1 6.91 Trade and Tourism -0.8 4.8 5.0 2.0 6.0 7.0 Transport, Storage and Communications 1.7 5.3 2.2 2.0 6.0 7.0 Finance, Insurance and Real Estate 3.8 3.7 4.6 4.0 5.0 6.0 Government Services 10.3 6.8 4.5 4.5 8.0 9.0 Other Services 5.4 4.6 5.0 3.0 5.5 6.0 Imputed Financial Charges 2.1 3.1 2.6 2.0 5.0 5.0 Indirect Taxes 3.2 4.5 4.9 2.0 5.5 5.5Source: Sierra Leonean Authorities and Fund Staff Estimates and Projections

32. On the demand side, domestic demand including private and Governmentconsumption as well as capital formation (private and public investments) will continueto account for greater proportion of Gross Domestic Product. Net exports (exports minusimports) will be negative over the projection period as imports are projected to continueto exceed exports in the medium-term.

Table 3.2: National Accounts-Expenditure Side (2015-2020)

Percent of GDP 2015 2016 2017 2018 2019 2020 Average

Private consumption 100.9 102.1 93.9 91.2 90.4 99.4 96.3 Government consumption 10.2 11.2 9.6 9.4 8.9 9.0 9.7 Gross capital formation 15.5 15.4 15.4 15.3 (17 15.2 15.1 15.3 Exports 15.2 17.2 18.6 19.8 17.8 16.6 17.5 Imports 35.2 34.1 31.4 29.8 28.9 29.6 31.5 National savings -4.1 8.5 0.4 3.2 4.2 -0.5 2.0 Government - - - - - - Domestic -12.6 -13.3 -3.5 -0.7 0.8 -8.3 -6.3

Source: SSL Estimates and Forecasts from SLIM Model

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3.3.2 Inflation

33. Inflationary pressures are projected to moderate over the medium term. Theyear on year end period inflation is expected to decline to 11.0 percent by end 2018 and8.5 percent by 2020.

3.3.3 Money Supply

34. Broad Money is projected to grow by 13.4 percent in 2018, 14.9 percent in 2019and 16.2 percent at end 2020. Reserve Money will also grow at the same rate over themedium term. The BSL will continue to intervene through the use of availableinstruments in the secondary market to manage aggregate money supply.

3.3.4 Exchange rate

35. The exchange rate will continue to be market determined. Interventions by theBSL in the foreign exchange market will be limited to containing temporary excessivevolatility. BSL will aim to become a net buyer of foreign exchange over the medium termto build reserves.

3.3.5 Exports

36. The growth in exports is projected to average 14.3 percent in the medium term,moderating from 20.1 percent in 2018 to 7.2 percent by 2020, as iron ore productionreaches the maximum capacity. Exports are projected to continue to be dominated byminerals but will be boosted by the production of palm oil and other cash crops, suchas cocoa, as recent investments in this sub-sector reach production stage.

Table 3.3 Export of Goods (fob)

2014 2015 2016 2017 2018 2019 2020

Exports (FOB) 1,304 581 670 784 941 1,169 1,289o/w Diamonds 213 160 164 102 146 175 200o/w Iron Ore 742 77 142 225 244 296 333

3.3.6 Imports

37. Imports are projected to grow by 7.7 percent in 2018, 8.1 percent in 2019 and9.0 percent in 2020 in line with the expansion in economic activity. Oil imports willincrease in line with expansion in economic activity and the transport sector growth.

3.3.7 Current Account

38. The current account deficit is projected to moderate to 18.1 percent of GDP in2018 from 21.0 percent of GDP in 2017. The current account deficit will increase to18.6 percent of GDP in 2019 and 19.0 percent of GDP in 2020 in line with movementsin the trade balance and reduction in transfers.

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3.3.8 Balance of Payments

39. The overall Balance of Payments position is projected to be in a surplus of US$20million (0.5 percent of GDP) in 2018 and remain positive throughout the medium-termfrom a negative position of US$95 million (2.5 percent of GDP) in 2017. This will be drivenmainly by improvement in Foreign Direct Investment and inflows from bilateral andmultilateral donors.

40. Gross foreign reserves are projected to increase from US$551 million (2.8months of imports) in 2018 to US$695 million (3.0 months) of imports in 2020.

The medium-term macroeconomic projections are provided in Table 3.4 below:

Table 3.4: Medium Term Macroeconomic Projections

2015 2016 2017 2018 2019 2020 Annual percentage change unless otherwise stated

Real SectorReal GDP -20.5 6.1 5.6 5.0 6.2 7.0Excluding Iron Ore 3.2 4.3 3.5 5.0 5.9 6.6Consumer Prices (EOP) 10.1 17.4 18.6 13.6 9.0 8.5Consumer prices (average) 9.0 11.5 15 12.5 9.7 8.7External SectorExports of goods 55.4 15.2 16.8 20.1 16.0 7.7Imports of goods -18.1 -2.3 7.7 3.0 8.1 9.0Gross InternationalReserves (US$ millions) 580 503 486 551 653 695Months of Imports 3.8 3.1 2.8 2.8 3.0 3.0Months of Imports(excl. iron) ore) 4.7 4.3 3.6 3.1 4.3 4.2Iron Ore Output(millions) metric tons) 0.77 6.0 9.0 9.5 15.0 15.0Money and CreditBroad Money (M3) 4.9 17.9 11.3 14.6 14.9 16.2Reserve Money 8.3 23.9 11.3 14.6 14.9 16.2Credit to the Private Sector 9.1 16.7 9.1 -36.0 16.7 17.4Treasury Bills Rate(91 Days) 2.1 … … … … …Velocity (GDP/M3) 4.3 4.2 4.7 … …Current AccountBalance Percent of non-ore GDP, unless otherwise indicated(incl. grants) -17.5 -19.9 -21.0 -18.1 -18.6 -19.0(excl. grants) -25.7 -25.6 25.2 -21.7 -21.1 -21.5External Public Debt 29.4 37.2 42.5 42.5 49.9 59.6Overall Balance ofPayments -4.3 -4.1 -2.5 0.4 2 1

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Memorandum Items

GDP at Market Prices (billions of Leones) 21,582 23848 30,114 35,187 38648 44242 Excluding Iron Ore 21,549 23,605 29,191 34,464 38,004 43,828Excluding IronOre (millions of US$) 4,245 3,678 3,799 4,017 4,316 4,663Per capita GDP (US$)

Source: Sierra Leonean Authorities and Fund Staff Estimates and Projections

Box 3.1: Medium-Term Macroeconomic Assumptions

Economic growth during the medium term will be driven by i) ramping up of iron oreproduction; ii) investments in other mining activities; iii) Government and privatesector investments in the agriculture sector; iv) enhanced spending on infrastructureincluding roads, energy and agricultural projects; v) structural reforms to improve thebusiness environment.

Inflation: The stabilization of the exchange rate combined with proactive stance ofmonetary policy complemented by fiscal consolidation will contribute to dampeninginflationary pressures. In addition, the projected increase in agricultural production,especially food crops will also contribute to lower consumer prices.

External Trade: The expansion of mineral exports especially iron ore as well asincreased exports by agribusinesses with higher value addition will assist in narrowingthe trade deficit and current account deficit. Imports will grow largely in accordancewith economic activities. The improvement in business environment will increaseprivate sector investments and hence improve capital and financial accounts.

Money Supply: The Bank of Sierra Leone will intervene in the secondary market formanaging aggregate money supply using monetary aggregates as operating instruments.

Exchange rate: The exchange rate will continue to remain market determined withthe BSL intervention limited only to smoothing excessive volatility in the exchangerate.

Gross foreign exchange reserves: Increased exports combined with the interventionof the BSL only as net buyer of foreign exchange in the market will improve the grossforeign reserves position.

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3.4 Comparison between 2017 Outturns and Projections

41. Real GDP growth was revised upward to 5.6 percent compared to the earlierprojection of 5.4 percent. This growth reflects higher-than-anticipated growth inmining, especially iron ore. Hence, growth of the mining and quarrying sub-sector wasalso revised upward to 34.8 percent from 22.2 percent. In the 2017 FSS end periodInflation was forecasted at 10.5 percent for 2017. However, owing to the higherinflationary pressures observed during the first half of the year due mainly to thedepreciation of the exchange rate, the forecast for end of period inflation was revisedto 18.6 percent for 2017. Annual average inflation forecast was also revised upward to15 percent compared to earlier projection of 10.5 percent. Inflation for June 2017 was19.1 percent compared to the end year target of 18.6 percent.

Table 3.5 2017 Macroeconomic Outturns Versus Projections

2016 FSS2017 REVISED 2017 Actual, as at, 2017Annual percentage change

Real SectorReal GDP 6.1 5.4 5.6Excluding Iron Ore 4.3 4.1 3.5Consumer Prices(end of period) 17.4 10.5 15.6 18.0 (Augustt)Consumer prices(average) 11.5 10.5 19.0 17.47(August)External SectorExports of goods 15.2 16.8 17.0 54(June)Imports of goods -2.3 1.3 7.7 61.6 (Septl)Gross International Reserves (US$ m) 500 608 486 438.26 (April)Months of Imports 3.0 5.0 2.8 3.1 (April)32AprilMonths of Imports (excl. iron ore) 4.3 …. 3.9Iron Ore Output(millions metric tons) 6.0 9.0 9.0 5.2 m MT Sept)

Money and CreditBroad Money (M3) 17.9 11.1 11.3 4.54 (June)Reserve Money 23.9 11.1 11.3 -2.36 (June)Credit to thePrivate Sector 16.7 8.3 6.5 8.46 (June)Treasury Bills Rate (91 Days … … …

Velocity (GDP/M3) 4.2 4.5 4.5Percent of GDP

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Current Account Balance(incl. grants) -19.9 -17.8 -21.0Current Account Balance(excl. grants) -25.6 -21.6 -25.2External Public Debt 37.2 34.4 42.5Overall Balance of Payments -4.1 - 1.2 -2.1Memorandum ItemsGDP at Market Prices(billions of Leones) 23,848 30,640 30,114 Excluding Iron Ore 23,605 30,411 29,191Excluding Iron Ore(millions of US$) 3,678 4,255 3,799Per capita GDP (US$) 6,417 621 597

Source: Sierra Leonean Authorities and Fund Staff Estimates and Projections

42. Growth in export of goods was revised to 17.0 percent from the earlier projectionof 16.8 percent largely on account of an upward revision of mineral output and pricesforecasts. Total exports for the first quarter of 2017 amounted to US$151.1 millioncompared to the forecast of US$784 million for the whole year 2017, representing ananualized growth rate of 13.7 percent.

43. Projected import growth was revised to 7.7 percent in April 2017 compared tothe earlier projection of 1.3 percent projected in November 2016. As at April 2017, totalimports amounted to US$537 million compared to the revised projection of US$1.44billion.

44. The projection for gross foreign reserves was revised downwards from US$608million (5.0 months of imports) in the 2017 FSS to US$447 million (2.6 months ofimports) in September 2017, largely due to the projected decline in donor inflows. Grossforeign reserves amounted to US$464.46 million as at end June 2017.

IV.FISCAL POLICY

4.1 Fiscal Developments: 2015-2016

4.1.1 Domestic Revenue Performance

Domestic revenue dropped to 10.8 percent of GDP in 2015 reflecting the disruptionsto economic activities following the twin shocks. For 2016, domestic revenue collectedincreased to Le2.9 trillion (12.1 percent of GDP). As indicated earlier, this improvedperformance is attributed largely to one-off revenue, in the form of capital gains tax,removal of fuel subsidies and strengthened enforcement.

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Table 4.0 Government Revenue and Grants, 2015 - 2016

In billions ofLeones Actual % of Non- Actual % of Non- Projection % of NonOre GDP 2015 Iron Ore 2016 Iron Ore 2017 Iron Ore

GPD GDP (September)Total Revenueand Grants 3495 16.2 3615 15.3 4,300 14.8DomesticRevenue 2330 10.8 2889 12.2 3,528 13.312.1Income Taxes 902 4.2 1269 5.3 1,262 4.3 4.4GST 593 2.8 666 2.8 826 2.8 2.8Customs andExcise 546 2.5 570 2.4 985 3.4 3.3MinesDepartment 87 0.4 156 0.7 146 0.5 0.5OtherDepartments 108 0.5 139 0.5 191 0.7 0.3Road User Charge 5 0.4 89 0.5 115 0.4Grants 1165 5.4 727 3.1 772 2.1 2.3Programme(including budgetsupport) 656 3 201 0.8 310 0.9 0.6Projects 508 2.4 505 2.3 369 1.3 1.7Source: Government of Sierra Leone

4.1.2 Grants

45. Total grants received amounted to Le1.2 trillion (5.4 percent of GDP) in 2015,of which budget support amounted to Le 656 billion and project grants, Le 508 billion.Grants received dropped to Le 727 billion (3.1 percent of GDP) in 2016, of which budgetsupport amounted to only Le193 billion. The decrease in budget support reflected thegeneral decline in Ebola-related donor support from the scaled-up levels in 2014 and2015. In addition, the late disbursement of World Bank budget support, and the lowerthan expected disbursements from DFID resulted in the decline in grants. Projectgrants amounted to Le 525 billion (2.3 percent of GDP) in 2016.

4.1.3 Government Expenditures

46. Total expenditure and net lending amounted to Le4.5 trillion (20.8 percent ofGDP) in 2015. Of this, recurrent expenditure amounted to Le2.8 trillion (13.0 percentof GDP) and capital expenditure, Le1.6 trillion (7.5 percent of GDP). Domestic capitalexpenditure amounted to Le653 billion in 2015 (3.0 percent of GDP). Total expendituresand net lending increased to Le5.5 trillion (23.4 percent of GDP) in 2016. As a resultof this, recurrent expenditures increased to Le3.6 trillion (15.1 percent of GDP) andcapital expenditures to Le2.0 trillion (8.6 percent of GDP). Domestic capital expendituresalso increased to Le1.0 trillion (4.3 percent of GDP).

47. In 2016, the wage bill accounted for about 62.7 percent of domestic revenue or7.8 percent of GDP in 2016.

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Table 4.1 Government Expenditure and Net Lending, 2015 - 2016

Actual % of % of % of

2015 Non-Iron Budget Non-Iron Actual Non-Iron

Item Ore GDP 2016 Ore GDP 2016 Ore GDP

Total Expenditure

& Net Lending 4,419 20.8 4,639 18.9 5,519 23.4

Recurrent Expenditure 2,803 13.0 3,121 12.7 3,553 15.1

Wages and Salaries 1,587 7.4 1,651 6.7 1,818 7.7

Goods and Services 670 3.2 795 3.2 1,139 4.8

Subsidies & Transfers 342 1.6 376 1.5 395 1.7

Interest Payments 175 0.8 300 1.2 202 0.9

Capital Expenditure &

Net Lending 1,616 7.5 1,517 6.2 2,039 8.6

Foreign Financed 963 4.5 904 3.7 1,034 4.4

Domestic Financed 653 3.0 613 2.5 1,005 4.3

Net Lending - - - - (151) (0.6)

4.1.4 Budget Deficit and Financing

48. The overall budget deficit, including grants increased from 4.6 percent of GDPin 2015 to 8.1 percent of GDP in 2016 and it is projected to decrease to 7.6 percent ofGDP in 2017. Excluding grants, the deficit increased from 10.0 percent of GDP in 2015to 11.0 percent of GDP in 2016 and is expected to narrow down to 9.9 percent of GDPin 2017. The domestic primary budget deficit increased from 5.3 percent of GDP in 2015to 6.6 percent of GDP in 2016 and is projected to decline to 5.1 percent of GDP in 2017.

49. The deficit was financed largely by domestic borrowing. Domestic bankfinancing is estimated at 4.2 percent of GDP in 2016 with foreign financing averaging1.7 percent of GDP during 2015 and 2016.

4.2 Fiscal Developments in 2017

54. Total domestic revenue collection amounted to Le1.668 trillion for the first halfof 2017 compared to a target of Le1.667 trillion, resulting in an excess above the targetof about Le1.3 billion. Collection from income taxes was Le 569.6 billion exceeding thetarget by Le14.6 billion. Goods and Services Tax was below target by Le10.6 billion withtotal collections of Le371 billion. Customs and Excise collections amounted to Le 496billion compared to a target of Le 461 billion. Mines Department collections amountedto Le 79.3 billion, recording a shortfall in target of Le 23 billion. Revenues collectedfrom Other Departments were Le 46 billion below target with collections amountingto Le 93.9 billion. Road User Charges and Vehicle Licenses amounted to Le 58.8 billioncompared to the target of Le 28 billion, recording an excess of Le 30.8 billion.

55. Total revenues are projected to reach Le 3.5 trillion or 12.0 percent of GDP byend 2017 compared to an earlier projection of Le 3.7 trillion. Personal Income Taxesare projected at Le 889 billion for 2017, the same as earlier

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projected; Corporate income tax projection is now projected at Le 368 billion comparedto the previous projection of Le 379 billion., with a variance of Le 11 billion. DomesticGST is estimated to amount to Le 388 billion while import GST is estimated at Le 438billion, compared to an earlier projection of Le 451 billion projected in April. Import dutyis projected to decline to Le 491 billion compared to Le 514 billion estimated earlier.Mining royalties and licenses are estimated to reach Le 146 billion relative to an earlierestimate of Le 256 billion. At the same time, Non-tax revenues are projected at Le 237billion for 2017 compared to Le 281 billion earlier forecasted.

56. The downward revision of the projected domestic revenues relative to the Aprilprojections is attributed to the incomplete or less than full implementation of threekey revenue measures agreed in April 2017 in lieu of the postponement of the fullliberalisation of retail petroleum pump prices under the new programme with the IMF.These measures are i) the elimination of all duty and GST exemptions, except thosecovered by international multilateral or bilateral agreements; ii) application of royaltyrates on minerals to international market prices, rather than company-quoted salesprices; and iii) Collecting dividends from State-Owned Enterprises.

Grants

57. Total grants received as at end June 2017 amounted to Le 79.6 billion, comparedto a target of Le 285.8 billion. No budget support was received during the first half ofthe year. Project grants amounted to Le 74 billion. The main reason for the shortfallwas the delayed disbursement of the programmed EU budget support of about US$ 16.6million. Grants are projected to amount to Le 772 billion or 2.7 percent of GDP during2017; of which budget support will amount to Le 495 billion. The planned disbursementof 10 million Pound Sterling was cancelled by DfID.

Expenditures

58. Total expenditures and net lending amounted to Le 2.95 trillion for the first halfof 2017 and are projected to reach Le 6.2 trillion or 21.2 percent of GDP by end of 2017,compared to Le6.28 trillion budgeted earlier. The overrun of Le148 billion for the firsthalf is accounted for by higher-than budgeted spending on domestic interest payments(Le16 billion), subsidies and transfers (Le7 billion), Goods and Services (Le75 billionto cover expenditures related to mudslides funded by the World Bank), and domesticcapital expenditure (Le47 billion). As a result, recurrent expenditure is revisedupwards to Le 4.83 trillion or 14.0 percent of GDP for 2017 compared to the earlierbudget of Le 4.15 trillion. Recurrent expenditure amounted to Le2.1 trillion during thefirst half of 2017. The wage bill amounted to Le 932 billion and is projected to remainwithin the yearly budget of Le1.83. Goods and Services expenditure amounted toLe592.9billion and is projected to increase to Le 900.3 trillion for the year.

50. The overall budget deficit, including grants, is estimated at Le1.88 to for end2017.

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59. Foreign financing of the deficit in the form of project and programme loans isprojected at Le1.02 trillion. The repayment of principal on loans is estimated at Le257billion, giving net foreign financing of Le760 billion.

60. Domestic financing of the budget for the first half of 2017 was Le796.3 billioncompared to a target of Le797 billion. Of this, Bank financing amounted to Le779.3billion (Central Bank Le 621.3 billion and Commercial Banks Le 158 billion).Borrowing from Non-bank financial institutions amounted to Le 17 billion. For the yearas whole, domestic financing of the deficit is projected to amount to Le 1.24 trillion;of which, bank financing, Le1.18 trillion. Borrowing from the Bank of Sierra Leonethrough Ways and Means and secondary market operations will amount to Le 357billion. Borrowing from commercial banks will amount to Le 601 billion. Borrowing fromthe non-bank sector will amount to Le 50.4 billion.

4.3 Medium-Term Fiscal Forecasts, 2018- 2020

61. The overall objective of fiscal policy in the medium-term is to consolidate publicfinances by aggressively enhancing domestic revenue collection and rationalisingpublic expenditure through controlling the Government wage bill; rationalisingexpenditure on goods and services while scaling up expenditures on capital projectsand the growth and social sectors. The overall budget deficit, including grants, willdecline to 6.5 percent of GDP in 2018 and further to 5.6 percent in 2020 from 7.6 percentin 2017.

4.3.1 Domestic Revenue projections

62. Domestic revenue is projected to increase to Le4.56 trillion (13.3 percent of GDP)in 2018 from Le 3.5 trillion (12.1 percent of GDP) in 2017. It is projected to increaseto Le 5.6 trillion (14.8 percent of GDP) in 2019 and further to Le 6.7 trillion (15.4 percentof GDP) in 2020. The projected increase in revenues is based not only on the projectedexpansion in economic activities, but also on further implementation of keyadministrative measures, public financial management and tax policy reforms asarticulated in the medium-term Revenue Mobilisation Strategy.

Box 4.1: Medium-Term Revenue Mobilisation Assumptions

The Mobilisation Revenue Strategy, prepared jointly by Government and the IMF, willinform the mobilisation of domestic revenues in the short to medium term and will focuson: enhancing tax administration systems and basic processes to ensure revenue lawsare adequately administered and leakages minimized; introducing Public FinancialManagement (PFM) reforms to consolidate off-budget revenues into the ConsolidatedRevenue Fund, implying a significant reduction in the amount of revenues beingretained by MDAs; and formulating tax policy primarily geared towards revenuemobilization, without having negative impact on economic activity.

Consistent with the above, revenue generation will specifically focus on:

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(i) Administrative measures: directed towards the introduction of automatedand integrated revenue administration systems and improvement of the core revenueadministration processes relating to revenue administration cycle: registration, filing,payment, recording and accounting, compliance audit and risk management, appeal,reporting. These steps will be supported by automation and introduction of systems.

(ii) Public Financial Management reforms including (a) the establishment andoperationalization of the Treasury Single Account (TSA); and (b) the enactment of theFiscal Management and Control Bill.

(iii) Policy Reforms: including a) Rationalisation of Duty Exemptions andInvestment Incentives; (b) Review of Mining Agreements, (c) alignment and orharmonisation of ECOWAS Common External Tariff (CET).

See more details in section 4.3.3 below.

63. Personal income tax is projected to increase to Le1.1 trillion (3.3 percent ofGDP) during 2018, from Le889 billion (3.1 percent of GDP) in 2017. It will also increasefurther to Le1.3 trillion (3.5 percent of GDP) and Le1.6 trillion (3.8 percent of GDP) in2019 and 2020, respectively.

64. Corporate income tax is projected to increase from Le 375 billion (1.1 percentof GDP) in 2018 to Le 683 billion (1.6 percent of GDP) in 2020, mainly on account ofincreased economic activities across all sectors of the economy.

65. Goods and services tax is projected to increase from Le 1.09 trillion (3.2 percentof GDP) in 2018 to Le1.75 trillion (4.0 percent of GDP) in 2020. The increase in GSTrevenues will come from the effective implementation of administrative measuresinstead of increasing the tax rates, as well as the elimination of all import GST andduty exemptions.

66. Excise duty is projected at Le 321 billion (0.8 percent of GDP) in 2018, and isexpected to increase gradually to Le346 billion (0.8 percent of GDP) in 2020. A keyreason for the projected increase in excise revenue is the planned liberalization of fuelprices in the second quarter of 2018, which will entirely eliminate fuel subsidies. Theintroduction of a 20 percent excise duty on all luxury vehicles with CIF values in excessof US$ 25,000, excise duty on jewellery, cosmetics and perfumes is expected to boostexcise revenues.

67. Import duties are projected to amount to Le 794 billion (2.3 percent of GDP) in2018, and further increasing to Le1.1 trillion (2.5 percent of GDP) in 2020.

68. Mining royalties and licenses are projected to increase slightly, from Le 241billion (0.7 percent of GDP) in 2018 to Le 540 billion (1.2 percent of GDP) in 2020. Thisincrease will be on account of expansion of production by the major mining companies,coupled with a further review of all mining agreements and licenses that fall due.Revenues from Road User Charges and Vehicle Licenses are projected to increase fromLe129 billion or 0.4 percent of GDP in 2018 to Le 153 billion in 2020.

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Projected Domestic Revenue for 2018 (% of GDP) by source

4.3.2 Grants

69. Grants are projected to increase from Le658 billion (2.3 percent of GDP) in 2018to Le838 billion (1.9 percent of GDP) in 2020. Budget support will amount to Le 264 billionduring 2018 and increase to Le487 billion in 2020, averaging 1.1 percent of GDP duringthe projection period. Project grants are expected to decrease from Le 394 billion (1.1percent of GDP) in 2018 to Le351 billion in 2020.

Table 4.2 Medium term fiscal forecasts (billions of Leones)

2017 (est) 2018 (proj) 2019 (proj) 2020 (proj)

Total revenue and grants 4,300 6,214 6,321 7,566Domestic Revenue 3,528 4,556 5,550 6,728 Personal income tax 889 1,137 1,342 1,648 Corporate tax 368 375 526 683 GST 826 1,087 1,453 1,748 Excise 478 523 321 346 Import duties 491 794 880 1,074 Mines department 149 241 458 540 Other Taxes 191 245 425 500 RUC 115 128 133 153Grants 772 658 771 838 Budget Support 274 264 401 487 Projects 369 386 369 351Expenditure & net lending 6,178 7,284 8,489 10,039Recurrent expenditure 4,097 4,829 5,575 6,516 Wages and salaries 1,825 2,067 2,405 2,778 Goods and services 900 1,203 1,398 1,624 Interest payments 612 952 1,110 1,311 Domestic interest 535 854 938 1,056 Foreign interest 78 98 172 255Capital expenditure 2,080 2,455 2,914 3,523 Foreign financed 1,217 1,409 1,519 1,519 Domestic financed 863 1,046 1,395 1,767Domestic primary balance (1,276) (1,362) (1,451) (1,547) Overall balance incl grants (1,878) (2,070) (2,168 ) (2,473)

Overall balance excl grants (2,650) (2,728) (2,938) (3,311)

Source: Government of Sierra Leone

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4.3.3 Domestic Revenue Mobilisation Measures: 2018-2020

70. As part of the negotiations under the new ECF, the government of Sierra Leoneundertook several bold policy initiatives to increase domestic revenue in the short-term, with also medium-term consequences. These include the elimination of allimport GST and duty exemptions except those by which the government is boundthrough domestic tax law, agreements ratified by Parliament, international treatiesand bilateral obligations, the application of mineral royalties at market prices and newrevenue raising measures, including an excise duty on luxury vehicles, excise dutyon tobacco products, a royalty on telecommunications services and lotteries andgaming, and adjustments to tariff rates on beverages and wheat, ahead of the migrationto ECOWAS Common External Tariff. These measures are expected to yield about 1.0percent of GDP in revenues in 2017.

71. Additional reforms in revenue administration have also been adopted during2017, and are expected to have a positive impact on revenue collection, includingimproved processes and monitoring of debt management, disputes, complaints,registration and account cleaning as well as programmed audit selections andreporting on performance. In addition, a Revenue Administration Bill has been draftedwhich, when enacted, will harmonize administration of revenue laws enforced by theNRA.

72. Against this background, a key objective of the new Extended Credit Facility(ECF) agreed with the IMF is to mobilize significant domestic revenue, specifically 3.0percentage points of GDP over the span of the program from 2017 to 2019. The goal isto reach 15.1 percent of GDP by the end of the programme in 2019 and further to 15.8percent of GDP in 2020. To meet this target, and consistent with the RevenueMobilisation Strategy prepared jointly by Government and the IMF, the mobilisation ofdomestic revenues in the short to medium term will focus on the following:

* Laying the emphasis on enhancing tax administration basic processes toensure that Revenue Laws are adequately administered;

* Introducing Public Financial Management (PFM) reforms to consolidate off-budget revenues into the Consolidated Revenue Fund; implying a significantreduction in the amount of revenues being retained by MDAs;

* Formulating a tax policy primarily geared towards revenue mobilization,without harming economic activity;

73. Consistent with the three measures described in the previous paragraph, the2018 to 2020 revenue enhancing measures are classified into three categories namely:(i) administrative measures; (ii) public financial management reforms; and (iii) policyreforms.

4.3.3.1 Tax Administration Measures74. The Tax Administration Diagnostic Assessment Tool (TADAT) conducted in

September 2016 identified challenges in tax administration, many of which wereconfirmed and analysed in more depth during an IMF scoping mission in April 2017.Challenges that emerged include:

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(i) Lack of an integrated tax administration system-multiple IT systems, softwareand high use of manual systems that contribute to disorganized processes andunreliable data;

(ii) Ineffective and cumbersome filing, assessment/audit policy, and paymentprocesses that discourage compliance;

(iii) Lack of a risk compliance plan to identify, register, and enforce unregisteredand other non-compliant taxpayers;

(iv) Lack of a centralized and realistic reform strategy. There are multiple ongoingand anticipated reforms that are fractured across the organization, lackingownership and accountability.

75. Revenue administration measures in the medium term will therefore be directedtowards the improvement of the core revenue administration processes, as per therevenue administration cycle: registration, filing, payment, recording and accounting,compliance audit and risk management, appeal and reporting; all of these steps to besupported by automation and introduction of systems.

(a) Registration of Tax Payers

51. In order to develop an accurate and reliable taxpayer database, the NRA willreview, clean and update the existing taxpayer database and develop a registrationstrategy supported by an integrated taxpayer registration system. To ensure increasedregistration rate, taxpayer/business surveys will be periodically conducted. A registrationcampaign with a focus on small and micro taxpayers will be conducted to ensure thatinformal businesses are duly informed on the small and micro taxpayer regime andregister with the NRA. Given the low number of GST-registered businesses, a GSTregistration campaign will be undertaken and the GST registration and TIN registrationdata will be reconciled.

76. The Block Management System (BMS) project designed to use existing internaland external information (i.e. business registration, customs, SSL and other governmentdepartments) will focus on sections or blocks, within Freetown. This will involve-gathering relevant data and then physically canvass businesses to determinecompliance. A full reporting and follow-through will be key for sustainable complianceand measuring success.

(b) Filing Tax Returns

77. To reduce the time and cost spent on filing by taxpayers, electronic filing willbe introduced. Given the low number of businesses filing for GST, and consistent withthe emphasis on GST registration, emphasis will be laid on GST filing. Documentationrequirements relating to related-party transactions will be enforced.

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(c) Assessment and Valuation of Taxes

78. Customs valuation and classification and recording of origin of goods. Toascertain correct valuation of imported goods will be improved, the Monitoring,Research and Planning (MRP) Department of the NRA will report to the Ministry ofFinance and Economic Development (MoFED) on collected imported duty and importGST by Classification Valuation Certificates (CVC).

(d) Payment of Taxes

79. To facilitate and fasten the payment of tax due, additional electronic paymentmethods will be introduced. All processes and forms will be reviewed, simplified andmade accessible.

(e) Recording and Accounting

80. An adequate revenue accounting system will be introduced to better record revenuecollections.

Tax Compliance and Risk Management

81. Appropriate risk criteria will be developed for audit purposes to identify, assess,prioritise and quantify compliance risk. Third party data relating to liability-generatingevents, including data collected by Government agencies, will be collected andcompared with NRA data. NRA will gather data from other government agencies tocapture liability-generating events, including but not limited to Ministry of Labour,NASSIT, OARG, Ministry of Lands, National Tourist Board and Local Councils. To thisend, NRA will enter into Memoranda of Understanding (MoUs) with several MDAsincluding NASSIT, NMA, NATCOM, National Tourist Board, EPA, PRA, OARG, SLRSA,SLCAA, Ministry of Labour and the Local councils.

82. To ensure that high-revenue professions sufficiently contribute to the revenuemobilization effort, the NRA will engage professional associations such as theAssociation of Chartered Accountants, Sierra Leone Bar Association, the Medical andDental Association, and the Institute of Engineers to gather information on liability-generating events and encourage them to request their respective membership to betax compliant. The NRA will ensure that all professionals participating in contract bidsfor public procurement submit a tax clearance certificate as part of the bid in additionto the business's tax clearance certificate.

83. To combat cross-border smuggling, the NRA will intensify collaboration withstakeholders at border posts. A centralised debt management system will be implementedto track and follow up on all debt due to the NRA. Given the importance of the extractivesector for state revenues, a Mineral Tax Audit System will be developed by the ExtractiveIndustries Revenue Unit (EIRU) of the NRA, supported by a mining revenue risk analysistool. The NRA will conduct aggressive field audits to address non-compliance with 10percent withholding requirement on rental payments and purchase of real property,and update its database on rental income tax. With the support of external auditors,the NRA will conduct specialized audits in sectors requiring specialized capabilities,such as international shipping, transport and communications, insurance, banking,and mining.

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Automation of Domestic Tax Assessment and Collection Processes

84. In addition to improving the core processes described above, major processes willbe automated including; registration, tracking of arrears, internal reporting, processingof payment documents and declaration, among others. The introduction of anIntegrated Tax Administration System (ITAS) does not only provide automation of anumber of domestic tax administration processes, but also facilitates better datamanagement, internal reporting, processing of payment documents and declaration,among others. The system automates and integrates income tax and GST administrationin an effective and efficient way that meets operational and strategic needs of thedomestic tax administration, and this will eventually increase domestic revenue.

Tax Appeals

85. A robust “Objections and Appeals” process, as provided in the RevenueAdministration Bill, will be implemented.

86. The Fiscal Affairs Department (FAD) of the IMF will support medium-termreforms through an approved project under the Revenue Mobilization Trust Fund (RM-TF), currently scoped from 2017/2018-2019/2020. The project sets three objectivesconsistent with NRA's medium term priorities: (i) help build a phased revenue reformstrategy; (ii) further strengthen tax administration core processes, specifically in theareas of filing, assessment and payment, and in dispute resolution; and (iii) furtherfine-tune the compliance risk management framework. DfID is providing support incleaning up the registration database, providing support in targeted enforcement,testing electronic filing, and mapping out the business processes for the migration intothe new ITAS. The World Bank through the Public Financial Management Improvementand Consolidation Project will procure the Integrated Tax Administration System (ITAS)

4.3.3.2 Public Financial Management (PFM) Reforms

87. Two PFM reform measures that will assist in enhancing domestic revenuemobilisation include (i) the establishment and operationalization of the TreasurySingle Account (TSA); and (ii) the enactment of the Fiscal Management and ControlBill.

88. The establishment of a functioning TSA will help in the consolidation ofGovernment revenue, some of which is currently held in bank accounts outside thetreasury main accounts or the Consolidated Revenue Fund (CRF). Currently, there aredelays in the transfer of revenue in NRA transit accounts at commercial banks to theConsolidated Revenue Fund at the Bank of Sierra Leone. Under the TSA, the NRAtransit accounts will become sub-accounts of the TSA main account at the BSL andtherefore form part of the Government cash balances at any point in time.

89. Furthermore, a number of MDAs collect significant revenues, which are keptin commercial bank accounts and therefore not part of the Consolidated Revenue Fund.These revenues are retained by the MDAs while the government faces acute cashmanagement challenges. A consolidated Treasury account will help increase

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transparency, and bring these resources under one umbrella with potential for usageby Government. Under the TSA, these accounts will be identified and converted intosub-accounts of the TSA main account, and hence, form part of the Government cashbalances in the Consolidated Revenue Fund. The program envisages a finalization ofa working TSA by the end of 2017. A concept note is currently being finalized, andprogress is underway on the incorporation of the NRA transit accounts to the TSA.

90. The passage of the Fiscal Management and Control Act will, henceforth preventMDAs from retaining Government revenues by compelling them to deposit all collectedrevenues into the Consolidated Revenue Fund.

4.3.3.3 Policy Reforms

(i) Rationalisation of Duty Exemptions and Investment Incentives

91. In order to increase the revenue-to-GDP ratio, no new tax exemptions that arenot in the existing revenue laws will be granted. Requests for such exemptions in theform of agreements will not be submitted to Parliament for ratification. Exemptionscontained in revenue laws with expiry date will not be renewed once they expire.Exemptions without expiry date contained in revenue laws will be reviewed and anyamendment shall not make them more generous.

(iii) Review of Mining Agreements

92. Mining Lease Agreements (MLA) will be reviewed to ensure consistency withthe provisions of the Extractive Industries Revenue Bill (EIRB). The EIRB been finalisedand will be submitted to Parliament soon after approval by Cabinet.

(iv) ECOWAS Common External Tariff (CET)

93. The alignment and/or harmonisation of import duty rates in Sierra Leone withthose of the other ECOWAS member countries under the ECOWAS CET in compliancewith the ECOWAS trade related protocols is expected to have a positive impact ondomestic revenue collection. The process is expected to be finalized in December 2017.

4.3.4 Expenditure Projections: 2018-2020

Box 4.2: Medium-Term Expenditure Framework

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Recurrent Expenditure

Wage Bill: Government will maintain the Wage Bill at 6.0 percent of GDP over theMedium Term through a number of measures including: i) incorporating sub-ventedagencies payroll into the computerised Government payroll; (ii) collecting NASSITNumbers for all the staff on the Government payroll; (iii) paying teachers' salariesthrough bank accounts; (iv) tackling duplicate assignments with assignments foraffected staff being stopped; (v) harmonising rent allowances and leave allowances ofsub-vented agencies with the wider civil service; vi) completing the teacher verificationwith the findings implemented; vi) introducing Man-Power planning and a budgetformulation processes aligned to ensure a realistic wage bill; viii) introducing astandardized process and set of procedures for seeking approval for new recruitment;and ix) a system upgrade to help reduce ghost employees.

In addition, Government with assistance from Development Partners, will develop apayroll strategy to include capacitating the internal audit unit at MOFED to analysethe wage bill to tackle dual employment.

Capital ExpenditureCapital expenditure priorities will be driven by the following: (i) project alignment withthe Agenda for Prosperity; (ii) domestic capital budgetary allocation; (iii) projectscritical to the statutory function of MDAs; (iv) projects which will enhance theperformance/output/utilization of existing programmes and services; and (v) Projectsat or near completion stage for the budget year under consideration.

Joint monitoring of the implementation of capital projects by various institutions,including MOFED, Strategy and Policy Unit (SPU) at State House and line MDAs. AtMOFED, the Office of the Development Secretary, CPM&E, PIMU, and LGFD willevaluate projects to ascertain progress on work done by contractors or implementingagencies to effect payments to contractors. For donor funded projects, MPD, DACO andPIMU will carry out this function in conjunction with appraisal mission from donoragencies. SPU will also coordinate and provide national strategic oversight, monitoringand evaluation of public projects.

Policy guidelines on the management of the Public Investment Programme (PIP) willbe issued with clear roles and responsibilities on project identification, design,appraisal, monitoring and evaluation.

Expenditure and Contract Management Committee (ECMC) will be made operationalto ensure value for money in public procurement transactions including developing andimplementing procedures for reviewing and reporting of certificates by the ECMC.

Automation: To improve budget credibility, the budget execution process will beautomated and allotment controls rationalised.

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Table 4.3 Expenditure projections: 2018-2020

2018 % of GDP 2019 % of GDP 2020 % of GDP

Total Expenditures and Net Lending 7,284 21.2 8,489 22.3 10,039 22.9 current expenditures 4,829 14.0 5,575 14.7 6,516 14.9 wages and salaries 2,067 6.0 2,406 6.3 2,779 6.3 Goods and Services 1,203 3.5 1,398 3.7 1,623 3.7 Subsidies and transfers 607 1.8 661 1.8 803 1.9 Ebola Transfers - - - - - Interest 952 2.8 1110 2.9 1311 3.0 Domestic 854 2.5 938 2.5 1056 2.4 Foreign 98 0.3 172 0.5 255 0.6Capital Expenditure 2,465 7.1 2,914 7.7 3524 8.0 Foreign financed 1,409 4.1 1519 4.0 1756 4.0 Domestic financed 1,046 3.0 1,395 3.7 1767 4.0Net Lending 0 0.0 0 0.0 0.00 0.0Contingent expenditures (149) (0.4) (204) (0.5) (247) (0.6)

94. In line with Government's objective of consolidating public finances, totalexpenditures will average 22.1 percent of GDP, with recurrent expendituresaveraging14.5 percent over the medium-term. Capital expenditures, especiallydomestically financed, will increase significantly to average 7.6 percent over the periodin an effort to address the infrastructure deficit.

95. Total expenditure and net lending is projected to increase from Le 7.3 trillion(21.2 percent of GDP) in 2018 to Le8.5 trillion (22.3 percent of GDP) in 2019 and Le 10.0trillion (22.9 percent of GDP) in 2020.

4.3.4.1 Recurrent expenditure

96. Recurrent expenditure is programmed to increase from Le4.8 trillion (14.0percent of GDP) in 2018 to Le5.6 trillion (14.7 percent of GDP) in 2019 and further toLe6.5 trillion (14.9 percent of GDP) in 2020.

Wages and Salaries

97. Within recurrent expenditures, the Government wage bill will increasenominally from Le 2.1 trillion in 2018 to Le2.4 trillion in 2019 and further to Le2.8trillion in 2020. As a percentage of GDP, the wage bill will average 6 percent of GDPduring the medium-term from 7.6 percent and 6.3 percent of GDP in 2016 and 2017,respectively. This is consistent with Government's Medium Term Wage Policy ofkeeping the wage bill at the sustainable level of 6 percent of GDP. This implies thatthe growth of the wage bill in any given year is now linked to the growth in nominalGDP to ensure that the wage bill is fiscally sustainable. In other words, Governmentcan fund the wage bill without accumulating arrears or crowding out other priorityexpenditures. To ensure this, Government has been implementing a number ofmeasures and will continue to do so in the medium-term (see section on expendituremanagement and control in the medium-term).

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Interest Payments

98. Total interest payments are projected to move from Le 612 billion (2.1 percent ofGDP) in 2017 to Le952 billion (2.8 percent of GDP) in 2018, Le1.1 trillion (2.9 percentof GDP) in 2019, and further to Le1.3 trillion (3.0 percent of GDP) in 2020. This will belargely driven by domestic interest payments, which are projected to increase fromLe536 billion in 2017 (1.8 percent of GDP) to Le854 billion (2.5 percent of GDP) in 2018,Le938 billion (2.5 percent of GDP) in 2019, and further to Le1.1 trillion (2.4 percent ofGDP) in 2020. The projected increase in domestic debt service payments is mainly onaccount of the existing high stock of domestic debt and higher Treasury Bill interestrates. Domestic financing of the budget deficit is projected to decline in the medium-term. Foreign interest payments are also projected to increase from Le98 billion in 2018(0.3 percent of GDP) to Le255 billion (0.6 percent of GDP) in 2020 as external debtattracts relatively low interest rates.

Goods and Services

100. Goods and Services expenditure is projected to increase from Le1.2 trillion (3.5percent of GDP) in 2018 to Le1.4 trillion (3.7 percent of GDP) in 2019, and further toLe1.6 trillion (3.7 percent of GDP) in 2020Subsidies and Transfers

101. Subsidies and Transfers include transfers to National Electoral Commission,Tertiary Educational Institutions, Local Councils and the Road Maintenance FundAdministration. Total subsidies and transfers will increase from Le607 billion (1.8percent of GDP) in 2018 to Le661 billion (1.8 percent of GDP) in 2019 and to Le803 billion(1.9 percent of GDP) in 2020.

4.3.4.2 Capital expenditure102. Capital expenditure is projected to increase from Le2.5 trillion (7.1 percent of

GDP) in 2018 to Le2.9 trillion (7.7 percent of GDP) in 2019, rising to Le3.52 trillion (8.0percent of GDP) in 2020. Of this, foreign financed capital expenditures will amount toLe1.4 trillion (4.1percent of GDP) in 2018; Le1.5 trillion (4.0 percent of GDP) in 2019and Le1.8 trillion (4.0 percent of GDP) in 2010. Domestically financed capitalexpenditure is projected to increase significantly from Le1.0 trillion (3.0 percent ofGDP) in 2018 to Le1.4 trillion (3.7percent of GDP) in 2019 and Le1.8 trillion (4.0 percentof GDP) in 2020.

103. Contingency expenditure is budgeted at Le148 billion for 2018 to covercontingent expenditure (Contingent fund, Le90 billion; Presidential Warrants, Le45billion and MDA unallocated expenditure of Le 14 billion to be approved by the Ministerof Finance. It will increase to Le 203 billion and Le 247 billion during 2019 and 2020,respectively.

4.3.4.3 Budget Deficit and Financing: 2018-2020

104. The overall budget deficit, including grants is projected to decline from 6.5 percentof GDP in 2017 to 6.0 percent in 2018, and further down to 5.6 percent in 2020. Excludinggrants, the overall deficit will narrow down from 9.1 percent of GDP in 2017 to 7.9percent of GDP in 2018 and further down to 7.6 percent of GDP in 2020.

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105. The deficit will be financed by external borrowing in the form of project andprogramme loans averaging 2.6 percent of GDP over the medium term. Domesticfinancing is programmed to decline from 5.0 percent of GDP in 2018 to 3.5 percent ofGDP in 2019 and 2020, respectively consistent with the IMF programme.

4.4 Expenditure Management and Control Measures4.3.1 Recurrent Expenditure106. Wages and Salaries are a crucial component of government expenditure - and

the Government has committed to maintaining this at 6 percent of non-iron ore GDP,in line with our fiscal framework. A number of measures are being implemented toclean the payroll. These include: (i) moving the subvented agencies on to thecomputerised Government payroll, in order to exercise overall control over the wagebill; (ii) collecting NASSIT numbers for all staff in central payroll; (iii) paying teachersthrough their bank accounts; (iv) tackling duplicate assignments and stoppingassignments for affected staff; and (v) harmonizing rent and leave allowances of sub-vented agencies with the wider civil service.

107. The on-going teacher verification exercise will be completed by the end of July2017 and the findings will be implemented. Manpower planning and budget formulationprocesses have been aligned in order to ensure a realistic wage bill budget, and for thefirst time in this budget a request for more detailed manpower information will be sentto MDAs. The MOFED will also introduce a standardized process and set of proceduresfor seeking approval for new recruitment. The cleaning of the payroll will continue inpreparation for the system upgrade, which will help reduce ghost employees.

108. Going forward, with assistance from Development Partners, Government willdevelop a payroll strategy. Some of the activities in the strategy will includecapacitating the internal audit to analyse the wage bill and tackling dual employment,among others. Payroll will continue in preparation for the system upgrade, which willhelp reduce ghost employees.

109. To ensure value for money, the Expenditure and Contract ManagementCommittee (ECMC) will continue to be strengthened to ensure value for money in publicprocurement transactions. This will include but not limited to developing andimplementing procedures for the award of certificates that are received, reviewed andreported on by the ECMC.

110. To improve budget credibility, the budget execution process and allotmentcontrols will be automated and rationalised by the use electronic PETS form 1.

4.4.2 Capital Expenditure111. The monitoring of the implementation of capital projects is jointly undertakenby several institutions, including MoFED, other line MDAs, the Strategy and Policy Unitat State House. MDAs will undertake frontline or routine monitoring and evaluationexercise for projects under their purview. At MOFED, the Office of the DevelopmentSecretary, CPM&E, PIMU, and LGFD will evaluate projects to ascertain progress onwork done by contractors or implementing agencies to effect payments to contractors.For donor funded projects, this function is carried out by the MPD, DACO and PIMU inconjunction with appraisal missions of donor agencies.

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112. The Strategy and Policy Unit under the office of the President will alsocoordinate and provide national strategic oversight, monitoring and evaluation of publicprojects to keep track of milestones on project implementation and check whetherplanned activities are consistent with timeframes/schedules. Reports from these arecompiled and submitted for the attention of His Excellency the President, who chairsPresidential stock takes conducted on a sectoral basis to review progress on key priorityprojects.

113. Furthermore, to strengthen implementation and monitoring of capitalexpenditure, policy guidelines on the management of the Public Investment Programmeare issued, spelling out clear roles and responsibilities in relating to projectidentification, design, appraisal, budgeting, monitoring and evaluation. A new PIPpolicy has been drafted, and an operational manual prepared for the implementationof Public Investment Programme.

V.MEDIUM-TERM EXPENDITURE FRAMEWORK (MTEF) CEILINGS ANDEXPENDITURE PRIORITIES

114. Government expenditure priorities in the medium-term include scaling upexpenditures on infrastructure (roads, energy, water supply) to address the infrastructuredeficit; promote the diversification of the economy through increased spending onagriculture, fisheries and tourism to promote sustainable economic growth as well asexpand social spending (health, education and social protection).

5.1 Non-Salary, Non-Interest (NSNI) Recurrent Expenditure

115. Total non-salary, non-interest recurrent expenditures is projected to increasefrom Le1.8 trillion in 2018 to Le2.1 trillion in 2019 and further to Le2.4 trillion in 2020.

116. The table below shows the indicative budget ceilings for MDAs based on theavailable resources, both domestic and external.

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Table 5.0 Medium-Term Expenditure Framework 2018 - 2020

Details FY2017 % of FY2018 % of FY2019 % of FY2020 % ofBudget Total Budget Total Indicative Total Indicative Total(Le, m) Non Ceilings Non (Le, m) Non (Le, m) Non

Int/Sal (Le, m) Int/Sal Int/Sal Int/Sal Recurr Recurr Recurr Recurr

Exp Exp Exp Exp1 GENERAL

SERVICES 501,007 32.2% 526619 27% 502,303 22.2% 632006 27.9%

105 Ministry of Political

and Public Affairs 1,845 0.1% 2,457 0.1% 2,931 0.1% 3,497 0.1%

106 Office of the Chief

of Staff 5,890 0.4% 7,840 0.4% 9,355 0.4% 11,162 0.4%

107 Ministry of Local

Government & Rural

Development 9,314 0.6% 15,288 0.8% 15,242 0.7% 15,187 0.6%

108 Sierra Leone Small

Arms Commission 679 0.0% 904 0.0% 1,078 0.0% 1,287 0.1%

110 Office of the President 29,121 1.9% 36,766 1.9% 43,869 2.0% 52,345 2.0%

112 Office of the Vice

President 10,841 0.7% 14,431 0.7% 17,219 0.8% 20,546 0.8%

116 Parliament 7,750 0.5% 15,317 0.8% 18,277 0.8% 21,808 0.9%

117 Cabinet Secretariat 1,918 0.1% 2,554 0.1% 3,047 0.1% 3,636 0.1%

118 The Judiciary 10,423 0.7% 13,8759 0.7% 16,555 0.8% 19,754 0.8%

121 Audit Service

Sierra Leone 5,482 0.4% 7,297 0.4% 8,707 0.4% 10,389 0.4%

122 Human Resource

Management Office 2,230 0.1% 2,969 0.2% 3,543 0.2% 4,227 0.2%

123 Public Service

Commission 1,916 0.1% 2,550 0.1% 3,043 0.1% 3,631 0.1%

124 Law Officers'

Department 10,867 0.7% 14,866 0.8% 17,738 0.8% 21,165 0.8%

125 Local Courts 1,152 0.1% 1,534 0.1% 1,830 0.1% 2,183 0.1%

126 Independent Police

Complaints Board 800 0.1% 1,065 0.1% 1,271 0.1% 1,516 0.1%

128 Ministry of Foreign

Affairs & International

Co-operation 29,025 1.9% 38,638 2.0% 46,103 2.1% 55,010 2.1%

129 Ministry of Finance

and Economic

Development 51,200 3.3% 67,107 3.4% 80,923 3.7% 86,556 3.4%

130 National Revenue

Authority (NRA) 79,291 5.1% 90,462 4.6% 107,939 5.0% 127,860 5.0%

131 Revenue Appellate

Board 940 0.1% 1,251 0.1% 1,493 0.1% 1,781 0.1%

132 Accountant General's

Department 4,995 0.3% 37,699 0.3% 7,933 0.4% 9,466 0.4%

133 Ministry of Information

and Communication 3,385 0.2% 4,506 0.2% 5,377 0.2% 6,415 0.3%

134 National Electoral

Commission (NEC) 209,534 13.5% 123,862 6.3% 60,933 2.8% 124,910 4.9%

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137 National Commission

for Democracy 2,401 0.2% 1,897 0.1% 2,263 0.1% 2,700 0.1%

138 Statistics - Sierra Leone 8,794 0.6% 7,707 0.4% 9,196 0.4% 10,973 0.4%


for Privatisation (NCP) 2,037 0.1% 2,711 0.1% 3,235 0.1% 3,860 0.2%

140 Mass Media Services 196 0.0% 261 0.0% 311 0.0% 371 0.0%

141 Government Printing

Department 2,416 0.2% 3,216 0.2% 3,837 0.2% 4,579 0.2%

142 National Public

Procurement Authority

(NPPA) 2,677 0.2% 3,564 0.2% 4,252 0.2% 5,074 0.2%

143 Justice and Legal

Service Commission 275 0.0% 366 0.0% 436 0.0% 521 0.0%

144 Human Rights

Commission Sierra Leone 1,894 0.1% 2,521 0.1% 3,008 0.1% 3,589 0.1%

145 Rights to Access

Information Commission 1,719 0.1% 1,139 0.1% 1,359 0.1% 1,621 0.1%

2 SECURITY

SERVICES 243,912 15.7% 301,699 15.5% 359,986 16.6% 420,205 16.4%

201 Ministry of Defence 90,357 5.8% 106,687 5.5% 127,298 5.9% 142,563 5.6%

203 National Civil

Registration Authority 3,842 0.2% 2,714 0.1% 3,239 0.1% 3,864 0.2%

205 Ministry of Internal

Affairs1,019 0.1% 1,356 0.1% 1,618 0.1% 1,931 0.1%

206 Sierra Leone Police 87,868 5.6% 97,470 5.0% 116,300 5.4% 138,769 5.4%

207 Sierra Leone

Correctional Services 34,321 2.2% 58,189 3.0% 69,430 3.2% 82,844 3.2%

208 National Fire Authority 8,815 0.6% 11,734 0.6% 14,001 0.6% 16,706 0.7%

209 Central Intelligence

& Security Unit 5,240 0.3% 6,975 0.4% 8,323 0.4% 9,931 0.4%

210 Office of National

Security 7,086 0.5% 9,434 0.5% 11,256 0.5% 13,431 0.5%

211 Immigration Department 4,378 0.3% 5,828 0.3% 6,953 0.3% 8,297 0.3%

212 National Drugs Law

Enforcement Agency 987 0.1% 1,313 0.1% 1,567 0.1% 1,870 0.1%

3 SOCIAL SERVICES 389,241 25.0% 541,942 27.8% 658,578 30.4% 722,710 28.2%

301 Ministry of Education,

Science and

Technology 257,305 16.5% 369,574 18.9% 452,909 20.9% 482,307 18.8%

302 Ministry of Sports 6,004 0.4% 7,992 0.4% 9,536 0.4% 11,379 0.4%

303 Ministry of Tourism

and Cultural Affairs 3,171 0.2% 4,221 0.2% 5,036 0.2% 6,009 0.2%



Exp Exp Exp Exp

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Exp Exp Exp Exp

304 Ministry of Health

and Sanitation 94,937 6.1% 107,430 5.5% 128,185 5.9% 147,949 5.8%

305 Ministry of Social

Welfare, Gender &

Children's Affairs 9,160 0.6% 18,194 0.9% 21,709 1.0% 25,903 1.0%

306 Ministry of Lands,

Country Planning

and the Environment 3,069 0.2% 4,085 0.2% 4,875 0.2% 5,816 0.2%

307 National Medical

Supplies Agency 703 0.0% 1,186 0.1% 1,415 0.1% 1,688 0.1%


for Social Action 1,346 0.1% 1,791 0.1% 2,137 0.1% 2,550 0.1%

309 Dental and Medical

Board 326 0.0% 435 0.0% 519 0.0% 619 0.0%

310 Ministry of Youth

Affairs 7,180 0.5% 9,558 0.5% 11,405 0.5% 13,609 0.5%

311 Health Service

Commission 919 0.1% 1,223 0.1% 1,460 0.1% 1,742 0.1%

312 Teaching Service

Commission 1,105 0.1% 1,472 0.1% 1,756 0.1% 2,095 0.1%

313 National Youth Service - - 2,655 0.1% 3,168 0.1% 3,780 0.1%

314 National HIV and

AIDS Commission - - 2,940 0.2% 3,508 0.2% 4,186 0.2%

315 Teaching Hospitals

Complex Administration - - 3,040 0.2% 3,627 0.2% 4,328 0.2%

316 Civil Service Training

College - - 800 0.0% 955 0.0% 1,139 0.0%

345 Pharmacy Board

Services 4,016 0.3% 5,346 0.3% 6,379 0.3% 7,612 0.3%

4 ECONOMIC

SERVICES 275,615 17.7% 291,661 14.9% 331,591 15.3% 378,706 14.8%

401 Ministry of Agriculture,

Forestry and Food

Security 63,265 4.1% 53,992 2.8% 64,423 3.0% 66,869 2.6%

402 Ministry of Fisheries

and Marine Resources 3,023 0.2% 4,024 0.2% 4,801 0.2% 5,729 0.2%

403 Ministry of Mines and

Mineral Resources 6,745 0.4% 6,079 0.3% 7,254 0.3% 8,655 0.3%

404 Ministry of Transport

and Aviation 11,197 0.7% 12,790 0.7% 19,219 0.9% 21,891 0.9%

405 Ministry of Tourism

and Cultural Affairs 5,715 0.4% 8,408 0.4% 10,032 0.5% 11,970 0.5%

406 Ministry of Energy 4,146 0.3% 5,519 0.3% 6,585 0.3% 7,858 0.3%

407 Ministry of Labour and

Social Security 6,001 0.4% 7,988 0.4% 9,373 0.4% 11,184 0.4%

33



Exp Exp Exp Exp408 Ministry of Works,

Housing and

Infrastructure 10,016 0.6% 13,334 0.7% 15,910 0.7% 18,984 0.7%

409 Ministry of Trade and

Industry 10,904 0.7% 13,650 0.7% 16,288 0.8% 19,434 0.8%

410 National Protected Area

Authority 4,665 0.3% 2,156 0.1% 2,572 0.1% 3,069 0.1%

411 Road Maintenance

Fund 128,101 8.2% 128,900 6.6% 133,585 6.2% 153,487 6.0%

412 National Tele

communications

Commission (NATCOM) 0 0.0% 200 0.0% 239 0.0% 285 0.0%

413 Sierra Leone Electricity

and Water Regulatory

Commission 1,027 0.1% 1,367 0.1% 1,631 0.1% 1,946 0.1%

414 Ministry of Water

Resources 11,815 0.8% 14,728 0.8% 17,573 0.8% 20,968 0.8%

415 Sierra Leone

Maritime

Administration (SLMA) 0 0.0% 1,800 0.1% 2,148 0.1% 2,563 0.1%

416 Civil Aviation Authority 1,528 0.1% 2,034 0.1% 2,427 0.1% 2,896 0.1%

417 Nuclear Safety and

Radiation Protection

Authority 1,581 0.1% 2,105 0.1% 2,511 0.1% 2,997 0.1%

418 Sierra Leone

Agricultural Research

Institute (SLARI) 5,285 0.3% 5,725 0.3% 6,831 0.3% 8,151 0.3%

419 Local Content Agency 600 0.0% 799 0.0% 953 0.0% 1,137 0.0%

420 Sierra Leone

Environment

Protection Agency (SLEPA) 0 0.0% 400 0.0% 477 0.0% 569 0.0%

421 Small and Medium

Enterprises

Development Agency

(SMEDA) 0 0.0% 4,350 0.2% 5,190 0.2% 6,193 0.2%

422 Sierra Leone

Meteorological Agency 0.0% 1,314 0.1% 1,568 0.1% 1,870 0.1%

5 MISCELLANEOUS

SERVICES 881 0.1% 221 0.0% 264 0.0% 300 0.0%

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6 CONTINGENCY

EXPENDITURE 50,030 3.2% 180,000 9.2% 212,339 9.8% 256,942 10.0%

Contingency Fund 50,030 3.2% 90,000 4.6% 106,169 4.9% 128,471 5.0%

Special Presidential

Warrants 0 0.0% 45,000 2.3% 53,085 2.5% 64,236 2.5%

Unallocated

Expenditures 0 0.0% 45,000 2.3% 53,085 2.5% 64,236 2.5%

7 TRANSFERS TO

LOCAL COUNCILS 96,236 6.2% 139,907 7.2% 206,973 9.6% 273,078 10.7%

Total Non-Salary,

Non-Interest

Recurrent

Expenditure

Provisions 1,556,922 100% 1,951,000 100% 2,165,865 100% 2,561,089 100%

Domestic Capital Expenditure: 2018-2020

118. The preparation of the PIP is carried out within the Medium-Term Expenditure

Framework (MTEF). Capital expenditure priorities are driven by the following: (i) project

alignment with the Agenda for Prosperity; (ii) domestic capital budgetary allocation;

(iii) projects critical to the statutory function of the MDAs; (iv) projects which will

enhance the performance/output/utilization of existing programmes and (v) projects

at or near completion stage for the budget year under consideration.



Exp Exp Exp Exp

35

36

119. In line with Government priorities, Infrastructure and Energy accounts for thebulk of domestic capital expenditures amounting to Le701 billion in 2018, increasingto Le 1.1 trillion in 2019 and Le 1.4 trillion during 2020. This is followed by SocialServices and Human Development, with a budget of Le114.7 billion for 2018, Le 60billion in 2019 and Le 106 billion in 2020. The National Civil Registration Authority(NCRA) is allocated a budget of Le 95.3 billion in 2018; increasing to Le 150 billion in2019 Le 120 billion in 2020.

120. The agriculture sector will receive Le 8.7 billion from th Capital budget in 2018Le 4.5 billion in 2019 and Le9.5 billion in 2020.

5.3 2017 Fiscal Outturns versus Projections

121. Total Revenue was projected at Le3.596 (12.6 percent of GDP) in the 2017 FSS.The revenue projection was revised downwards to Le3.506 trillion (12.0 percent ofGDP), in view of the recent developments in the economy.

122. Total expenditure was projected at Le 5.44 trillion in the 2017 FSS. This hasbeen revised to Le6.2 trillion in September 2017 under the new ECF. Total expenditureas at June 2017 is estimated at Le2.95 trillion (10.3 percent of GDP). Wages andsalaries amounted to Le932 billion in June 2017 compared to the FSS projection ofLe1.81trillion; Goods and services expenditure amounted to Le592 billion in Junecompared to Le 941 billion projected in the 2017 FSS. Subsidies and transfers, Le 270.2billion and interest payments Le 268.2 billion as at June 2017.

123. Capital expenditures amounted to Le 851 billion, of which domestic fundedcapital expenditures amounted to Le565 billion compared to the projection of Le 565billion projected for the 2017 in the FSS for 2017.

VI. FISCAL RISKS STATEMENT124. Fiscal risks are factors, often outside the control of Government that can cause

a country's fiscal aggregates or economic performance to deviate from the macro-fiscalforecasts, resulting in most cases to lower revenues, higher expenditures and thuswider budget deficits. These variances can be large, and may result from a variety ofshocks; for example, shocks to economic growth, interest rates, exchange rate, andthe terms of trade; natural disasters; calls on Government Guarantees, also frominstitutional weaknesses. The commodity price shock of 2015 and 2016 and itsaftermath illustrated that the occurrence of fiscal risks can lead to significant fiscalchallenges.

125. This section assesses fiscal risks in Sierra Leone over the medium-term. First,it identifies and classify the different sources of fiscal risks; Second, it presents thevarious types of fiscal risks; and third, it assesses the sensitivity of the fiscal aggregates(revenue, expenditure and budget deficit) to the macroeconomic risks; and finally, itproposes measures to mitigate the impact of the fiscal risks on Government budgetand the economy as a whole.

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6.1 Broad Classification of Fiscal Risks126. Fiscal risks are generated from three main sources

(a) General Economic Risks-are fiscal risks that are generated from macroeconomicshocks such as shocks to GDP growth, exchange rates, interest rates andinflation. Shocks to these macroeconomic variables can affect Governmentexpenditures, revenues and the stock of public debt.

(b) Specific Fiscal Risks: These types of risks are usually unrelated to generaleconomic forecasting parameters. They give rise or contribute to uncertaintyabout specific fiscal outcomes and may include contingent liabilities and otherrisks.

(c) Structural or Institutional Risks: These risks relate to the limited capacity inGovernment to identify and manage fiscal risks due to weak institutions. Suchrisks when they exist can exacerbate a country's exposure to existing fiscalrisks.

6.2. Types of Fiscal Risks6.2.1 General Macroeconomic Risks

127. Like most low income, small open economies that are also commoditydependent, Sierra Leone is vulnerable to macroeconomic shocks. The 2008 and 2009global financial crisis clearly illustrates this assertion in light of the following.

* Shock to GDP Growth: An example of this shock was the case of the Ebolaepidemic and the fall in the price of iron ore, which culminated in the closureof the two iron ore mining companies. Shocks to GDP growth adversely affecttedthe revenue side of the budget as the tax base contracted. In general, a declinein GDP usually leads to lower domestic revenues as income taxes, GST, petroleumtaxes and import duties will decline, resulting in higher budget deficit.

* Commodity Price Shocks: Commodity price shocks often give rise to adverseterms of trade. Sierra Leone is an oil importer. Petroleum products comprisethe second highest import value in the country. Furthermore, petroleumconsumption is subsidized in the retail market. Therefore, a rise in theinternational oil prices will increase the amount of subsidy paid by Government,either in the form of implicit subsidies (loss in excise duties) or explicit (directpayments from the budget). In either case, Government expenditures willincrease and revenues decrease, leading to higher budget deficit.

* On the other hand, a fall in the price of one of Sierra Leone's major exportcommodities such as iron ore will lead to drop in GDP, domestic revenues andexchange rate depreciation with adverse budgetary implications.

* Slow Growth of the Chinese Economy: Related to the above is the fiscal riskassociated with a slowdown of the growth in the Chinese economy. It will impactSierra Leone as it reduces demand for the country's iron ore exports. Hence,revenue from this sub-sector of the economy will decline. The adverseconsequences on domestic revenue and foreign exchange earnings, both ofwhich are important components of budget execution cannot be overemphasized.

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* Shocks to Exchange Rate: Sierra Leone has a substantial stock of foreign debt.Foreign debt service payments are denominated in foreign currencies. Adepreciation of the exchange rate will increase debt service payments, includingboth interest and principal repayments.

* Interest Rates Shock: Sierra Leone also has a substantial stock of domesticdebt in the form of marketable and non-marketable Government securities. Inrecent years, debt service payments on domestic debt account for a significantproportion of recurrent expenditures. Domestic interest payments have beenincreasing in recent years, reflecting increased Government borrowing andrising Treasury bill rates. Therefore, further rises in Treasury bill rates willincrease Government expenditures, leading to higher budget deficit.

* Inflation: is currently in double digits in Sierra Leone although consumer priceshave started to decline. Year on year inflation was higher than usual at 19.1percent as at June 2017. Further rises in inflation will lead to higherexpenditures, thereby increasing the budget deficit.

6.2.2 Specific Fiscal Risks

128. Contingent Liabilities: Fiscal risks in Sierra Leone can arise from contingentliabilities when they materialise. This area examines the impact on the budget of therealization of all Government loan guarantees and contingent liabilities from the twostate-owned banks.

* Guarantees: The Government provides guarantees against bank loans contractedby state-owned or public enterprises and local councils. Total guarantees amountto Le115.72 billion as at August 2017. In the event public enterprises or localcouncils fail to pay the loan in time, the guarantees would be invoked and theliabilities for payment will be passed on to Government. Consequently, theguarantees would eventually become debt to Government. An examination ofthe stock of current guarantees indicates that risks emanating from guaranteesare minimal at the moment. Should they materialize, the impact on public debtwould be small.

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Fiscal Operations of State Owned Enterprises

129. Fiscal Operations of State Owned Enterprises- There are a number of risks emanating from the operations ofState Owned enterprises that impact on the Budget during the cause of the year. While there is no consolidateddata available across these entities, they often emanate from tax defaults, subsidies to cover non-market pricerevenue shocks (such as fuel support to Road Transport Corporation for the 100 buses, fuel to EGTC/EDSA);payment of passenger levies in respect of Securiport, recapitalization and capital investments. To mitigate theserisks and under the PFM Act 2016, an SOE Unit will be established in the Ministry of Finance and EconomicDevelopment charged with the responsibility for identifying, monitoring, analyzing and reporting of fiscal risksand its impact on the Budget.

* Public-Private Partnerships (PPPs): Public Private Partnership's arrangements are also contingentliabilities. A failure of the contracting party to honour the obligations, such as the refusal of the public to pay thetoll fees on the Wellington-Masiaka Toll Road or pay reduced fees would imply that Government takes over theliability. The implementation of PPPs should therefore be closely monitored to avoid unexpected budgetaryexpenditures. The following PPPs have been signed by Government as at August 2017: (i) Wellington-MasiakaToll Road million); CEC Western Area Energy Project (US$133 million) with projected annual payments of US$74-84 million for 25 years; and Bumbuna II Hydro project of US$651 million with annual projected payments ofUS$120 million for 25 years. Earlier the Government signed a one berth port expansion of the Queen Elizabeth IIQuay with Freetown Terminal Limited (Bolloré for US$ 120 million).

40

130. State-Owned Commercial Banks: Sierra Leone has two state-owned banks inits portfolio of public enterprises. Unfortunately, the balance sheets of these two banksare weak and this represents a significant fiscal risk to the Government budget. Thebanks account for 13 percent and 19 percent of the total banking system assets. Whilethey have been under serious financial conditions due to the impact of Ebola oneconomic activities on the one hand, they also face high competition in the market,with weak internal governance, including poor risk management. They account for amajority of the outstanding non-performing loans (NPLs). The capital of the two bankshas been severely eroded. The cost of recapitalizing the banks is estimated at Le200billion and Government is developing a strategy to address the situation.

131. Other Risks: Other risks include the impact of major events or one-off eventswhich can impact the macro-fiscal situation. These include:

* Natural Disasters: The scale and timing of the occurrence of natural disasterscannot be easily predicted. They can cause untold suffering on affected peopleand the economy as a whole through destruction of property, loss of lives anddisplacement of the persons. Recovery often requires substantial financialresources that are in most cases not budgeted for to address immediate needsof the affected persons including rehabilitating and reconstructing damagedinfrastructure. The mudslides and flooding from the heavy downpour thatoccurred in Freetown on August 14, 2017 is a good example. The re-emergenceof Ebola is another risk. The associated disruptive impact on economic activitiesresulting from any re-emergence of the Ebola viral disease would have severeconsequences on domestic revenue mobilization and at the same time createundue expenditure pressures. This can derail budget implementation withresources diverted from other priority areas and shifted to fighting the spreadof the disease;

* 2018 General Elections: Finally, the upcoming elections pose a fiscal risk, asspending pressures could build up, resulting in expenditure overruns. The usualwait and see attitude adopted by businesses especially importers in the periodrunning up to the elections will adversely affect domestic revenue collection.In either case, the result would be a higher than planned budget deficit

6.2.3 Institutional Capacity Risks

132. Limited or weak capacity to implement Government policies and programmesis also another source of fiscal risk. This section focuses on a number of such risks.

* Budget Planning and Execution: Budget credibility has been identified by severalPEFA analyses as a major challenge in fiscal management in Sierra Leone.Revenues are usually below projections while expenditures have mostly exceededbudget limits. Government is working hard to improve budget credibility throughthe automation of budget execution process as well as strengthening the capacityfor macro-fiscal forecasting;

* Public Debt Management: Effective public debt management is critical toensuring debt sustainability given the vulnerability of external debt tomacroeconomic shocks such as exchange rate and interest rate movements.Government is taking steps to improve debt management through annual conductof Debt Sustainability Analysis and the preparation and implementation of thedebt management strategy;

41

* Non-Implementation of the Revenue Mobilisation Strategy: The non-implementation of the Revenue Mobilisation Strategy is the greatest risk tobudget implementation in the medium-term. The current domestic revenueprojections are far above what economic fundamentals and the present taxadministration capacity could generate. Given the fact that our revenue to GDPratio is one of the lowest in the sub-region and even among post conflictcountries, a Revenue Mobilisation Strategy has been prepared jointly with staffof the International Monetary Fund. The implementation of the revenueenhancing measures articulated in the strategy is critical in fundingGovernment's infrastructure and expanding social programmes. If the revenuemeasures are not implemented or do not bring the desired yields, given thelimited availability of domestic financing and the limited scope to cut spending,the government would likely accrue domestic arrears. With arrears, privatesector confidence in the government could deteriorate, leading to the disruptionof ongoing projects with negative feedback for growth and stability;

* Poor Implementation of Reforms related to the Disbursement of Budget Support:Budget Support is mainly provided by four development partners, the AfricanDevelopment Bank (ADB), European Union (EU), United Kingdom Departmentfor International Development (DFID) and the World Bank (WB) and forms asignificant proportion of the Government budget. Each of the partners basedthe disbursement of budget support on the implementation of certain reformsby the Government of Sierra Leone. Recently, representatives of these variousinstitutions have informed Government of a move away from direct budget supporttowards other lines of support in the medium-term. The greatest risk concernsfunding from DFID as the previous funding agreement comes to an end in 2017,and there might be significant difficulties in securing funds from DFID in 2018.Funding from the World Bank does not constitute a large risk. Given the growingreluctance of donors to provide budget support, it is even more critical forGovernment to implement reforms related to disbursement in order to boostdonor confidence. Moreover, the weak implementation of the reforms often resultsin the late or non-disbursement of budget support. This in turn will lead to cutsin expenditures or an increase in domestic borrowing with adverse consequenceson macroeconomic stability and economic growth. It can also lead to theaccumulation of arrears to suppliers and contractors, which will negativelyaffect the credibility of Government.

6.3 Risk Analysis

133. The risk analysis section sets out the key risks faced by Sierra Leone, and theanalysis supporting these risk assessments. It contains a risk assessment table(below) and analysis of the scale of impact of some macroeconomic shocks on fiscalvariables.

42

43

Impact of Negative and Positive Shocks on Macro Estimates

134. The macro-economic estimates are used as the basis for the forecasts ofrevenue and other key indicators. However, there is uncertainty over the scale ofgrowth, inflation and other indicators in the economy. This uncertainty comes fromthe difficulties in estimating these indicators given the short span of data, and theimpact of one off events on growth, among others.

135. The charts below show the impact of a simple one standard deviation shock bothpositive and negative to the growth rates of macroeconomic variables in 2018, and theresults on revenue, expenditure and the deficit.

Assumptions

* The charts below represent 1 standard deviation shocks, with some effects onmajor outcome variables (revenue, expenditure and deficits).

* Interactions between shocks and feedback effects are not modelled.

* Low responsiveness on expenditures reflects the changes in the automaticcosts (e.g. interest costs will go up with a worsening exchange rate); however,it does not reflect cost pressures leading to policy changes (e.g. if inflationincreases salary demand would increase).

* Revenue growth assumptions include some effect from new policy, and efficiency(i.e. introducing or increasing taxes, and getting better at collecting taxes).The scale of these impacts for simplicity is assumed to not be directly impactedby the macro-environment.

Shocks to Indicators

44

Results136. The shocks to these macro variables feed through into the below fiscal

outcomes, using the relationships set out in Sierra Leone Integrated Macro Model(SLIMM). The positive scenario, shown in green, shows the impact of a 1 standarddeviation increase in growth, exports and imports, and nominal GDP; and a onestandard deviation decrease in the exchange rate and inflation. The negative scenarioshows the opposite. The negative scenario shows the deficit widening to 8 percent ofGDP (after a negative shock to all the relevant macro variables in 2018); the positivescenario shows a closing of the gap to 3 percent of GDP. In the positive scenario, revenueincreases to Le 7.5 trillion by 2020; in the negative scenario it falls to Le 6.4 trillion.Expenditure pressures on the other hand rise to Le 10.2 trillion by 2020 in the negativescenario, and fall to Le 9.6 trillion in the positive scenario.

45

Uncertainty and Specific Shocks

137. The chart below shows the uncertainty of revenue under the macro-economicassumptions. If we are inaccurate, by a reasonable margin, in our economicprojections, the revenue for 2018 could vary from between Le 4.0 trillion, and Le 3.6trillion. This does not take into account non-macroeconomic uncertainty (like thedifficulties in improving tax administration, or implementing new policy measures).

138. An estimated shock of 1 percent to the exchange rate will feed through into localinflation - we estimate the impact of this using a VAR framework to account forinterdependencies between exchange rate and inflation. The chart opposite isgenerated from this, showing a 1 percent shock to the exchange rate (a depreciation)is estimated to increase inflation by 0.85 percent 3 quarters after, and 0.65 percent4 quarters after.

0100000020000003000000400000050000006000000700000080000009000000

10000000

2012 2013 2014 2015 2016 2017 2018 2019 2020

Revenue ForecastMillions Leones

46

6.4 Risk Mitigating Measures

139. Mitigating Macroeconomic Risks: to mitigate the impact of macroeconomic

shocks such as shocks to GDP, exchange rate, inflation and interest rates, Government

is pursuing sound macroeconomic policies including prudent fiscal policy and proactive

monetary policy to ensure a stable macroeconomic environment characterised by low

and stable inflation, exchange rate, and interest rates. To mitigate shocks to GDP and

by extension exports and exchange rate depreciation, Government is implementing

sectoral policies and measures to diversify the economy in order to broaden the sources

of growth and reduce reliance on one or a few sectors. Therefore, Government is

prioritising investment in agriculture, fisheries, tourism and infrastructure to build

the resilience of the economy against shocks.

140. Government is also building the capacity of key Ministries to analyse and

measure fiscal risks. As part of these efforts, the Ministry of Finance and Economic

Development is strengthening capacity in cash management through the establishment

of a Cash Management Unit and a functioning Cash Management Committee.

141. Mitigating the Impact of Contingent Liabilities: To mitigate the impact of

contingent liabilities, the Ministry of Finance and Economic Development is developing

a full set of guidelines for the issuance of loan guarantees and as well as template for

financial reporting by state-owned enterprises and local councils. Government with

assistance from the IMF AFRITAC WEST2 is in the process of establishing a unit within

the Ministry of Finance and Economic Development for fiscal oversight of State-Owned

Enterprises. Government is also undertaking an annual Debt Sustainability Analysis

to maintain debt sustainability.

47

142. Mitigating the Impact of Natural Disasters: To mitigate the effect of any re-

emergence of Ebola and other health emergencies, Government is working on

strengthening Integrated Disease Surveillance Reporting (IDSR) and response at

national, and community levels, as part of the President's Recovery Priorities.

Government has also integrated risk management in the national budget. A contingency

allocation is included in the Government budget to address effects of natural disasters.

In addition, early warning mechanisms will also be adopted to ensure readiness and

appropriate action before the occurrence of a disaster. Some of these measures

include:

(i) Sensitising the population on the causes and effects of disasters such as floods,

earthquakes, landslides, especially for people living in disaster prone areas

such as low lying coastal areas, hill tops, valleys, etc.

(ii) Integrating risk management into Government policy decision-making, especially

in fiscal management; and

(iii) Establishing and capacitating the appropriate institutions that will respond in a

timely manner to natural disasters.

48


FISCAL STRATEGY STATEMENT FOR 2018

Prepared by the Minister of Finance andEconomic Development

October 2018