The state budget of Cameroon has been trimmed down by 11% representing the sum of FCFA 542.2 billion in a bid to cushion the damaging economic impact of the novel coronavirus, COVID-19 pandemic.
The ordinance signed by Cameroon’s 87-year-old president Paul Biya amends the 2020 finance law. This change has seen the 2020 state budget adopted by Parliament to the tune of FCFA 4951.7 Billion sliding down to FCFA 4409 billion.
Here’s the problem in a nutshell: Government at every level relies on revenue estimates when planning budgets. More than a year in advance, the state anticipates how much the economy will grow, how much the usual taxes (income, sales and property among the larger sources) will rake in and then authorize spending on such broadly popular purposes as paying teacher salaries as well as those of police and firefighters, upgrading transportation (from building roads to filling pot holes) and addressing a host of other small, yet important responsibilities from reviewing development plans to maintaining public parks.
The abruptness and jaw-dropping scale of the current downturn could surely never have been anticipated even weeks ago.
Governments have installed some protections such as surpluses and rainy day funds (a balance that is tapped only in the event of an unanticipated emergency) but none is anywhere near enough to cover what’s eventually coming their way. The government’s reserves might float its general fund obligations a month, for instance. So they have two options but really only one. Officials can cut spending or they can increase taxes. And given how any elected leader who dares pursue a tax hike right now would mean his or her own unemployment courtesy of the ballot box, it’s really just about cutting spending.
At first, there will be fat to trim, efficiencies found, public relations campaigns that can be deferred, contracts that can be delayed. Then there are the tougher choices like hiring and pay freezes. And then, as things get bad, the dreaded “f” word — furloughs or unpaid holidays or even salary reductions for government workers.
Cameroon is not there yet coz only recently the country was seen concerned with buying luxury cars for newly elected lawmakers as well as for members of the bogus cabinet.
Mimi Mefo Info