South Sudan’s Parliament passed a budget of 6.6 billion South Sudanese pounds for 2012-2013 on Thursday.
The budget is less than last year’s budget, which was 10 billion pounds.
The biggest cuts came in foreign travel, salary bonuses, overtime, and housing allowances for government employees, including the army and organized forces.
Civil service salaries account for the biggest part of the budget, followed by spending on security and the judiciary.
South Sudan is operating on what has been called an austerity budget, due to the shutdown in January of oil production, which accounted for 98 percent of government money.
While presenting his budget proposal to parliament earlier this year, Finance and Economic Planning Minister Kosti Manibe warned against overspending, which he said could lead to a government deficit.
Manibe said, “I call upon the august house to ensure the implementation of the Public Finance Management and Accountability Act passed last year to ensure transparency and discipline in the implementation of the budget.”
Jok Madut Jok, the Director of the Sudd Research Institute and an undersecretary in the Ministry of Culture, Youth and Sports, says that security is the government’s “major priority,” as evidenced by the fact that the security budget was virtually unchanged.
South Sudan has been relying on donor money from other nations and its reserves.
The Sudd Institute estimates that the government has no more than $1 billion in reserve, which could be a problem with a budget that is much larger. Jok thinks Juba may have spoken with other countries about loans to help it through the difficult times.
He said the budget will result in a “marked reduction” in service delivery, “especially in the area[s] of education, security and health care and other such services.” But, he added, “On the whole, the impact is not going to be so great in the lives of the majority of the people who are not getting any benefits anyway, in terms of salaries being spread only among the political class and civil service.”
Jok said any “reduction in the size of the government is actually a lot more symbolic than being a solution to the economic troubles of the country.”
‘’This is a budget that [would have] pleased the people if had it been implemented many years back,” he explained. “You are now doing austerity simply because there is no money.’’
Jok suggests that an austerity budget introduced in the past would have made possible more investment in the nation’s development.