Public Finance in Sierra Leone: How National Priorities Get Funded

Revenue Mobilization — generating the resource envelope

The first step is raising the money. The state relies on domestic revenue (taxes, non-tax revenue, and fees), borrowing, and external support (grants or concessional financing) to build the “resource envelope.”

The Ministry of Finance (MoF) estimates how much revenue can realistically be collected, what grants or loans might be available, and what borrowing the state can undertake. This forecasting is carried out ahead of each fiscal cycle, and it sets practical limits for what government can spend.

Budget preparation and alignment with national priorities

Once revenue prospects are estimated, the MoF issues a Budget Call Circular to all MDAs. This circular sets budget ceilings and signals the strategic directions and priorities for government spending.

MDAs submit detailed proposals (recurrent and capital expenditure needs) showing how requested funding aligns with national development objectives. Sierra Leone’s Medium-Term National Development Plan (MTNDP) 2024–2030 outlines flagship priorities, often described as the “Big Five Game Changers,” including Food Security (“Feed Salone”), Human Capital Development, Youth Employment, Technology & Infrastructure, and Public Sector Reform.

The budget therefore acts as more than a technical financial document—it is a political statement of intent and a plan of action.

Approval, appropriation, and funding decisions

After MDAs submit proposals, the MoF consolidates and negotiates a final budget—often following discussions with each MDA. The Cabinet endorses the consolidated Budget/Appropriation Bill, which is then laid before Parliament. Once passed, the law provides legal authority to spend from the Consolidated Revenue Fund.

The budget distinguishes between recurrent expenditures (salaries and routine operations), capital expenditures (long-term investments like infrastructure and service delivery expansion), and debt service or lending. Capital spending matters because it reflects long-term commitments: roads, schools, health infrastructure, and rural electrification.

Prioritisation: how government chooses what gets funded

Resources are limited, so government must prioritise. Alignment with the MTNDP (and the Big Five) is intended to ensure that the most strategic sectors—such as food security, education, infrastructure, and human capital—are funded first. However, government reporting often acknowledges a challenge: only some MDAs consistently submit properly costed, medium-term strategic plans tied to national priorities. This weakens the link between planning, budget requests, and actual spending.

Financing gaps, borrowing, and external grants

When domestic revenue falls short, government may use borrowing (domestic or external) and external grants or donor funding. External support deposited into the national treasury becomes part of the resource envelope.

Borrowing and grants can create risks. Debt-service obligations may reduce fiscal space, grants may be uncertain, and donor funding can be project-specific or conditioned rather than general budget support. For example, in the 2025 budget, external grants (as estimated by the African Development Bank) are described as forming about 4% of GDP and supplement domestic revenue.

Implementation — turning allocations into real action

Once appropriations are made, MDAs implement programmes using allocations. Execution depends on institutional capacity, procurement systems, staffing, and supervision. The budget process is meant to reflect national priorities, but implementation success depends on whether allocated funds reach intended programmes in full and whether MDAs can deliver.

Oversight, transparency, and public accountability

Public finance is not only about allocation and spending. Transparency, accountability, and public participation are essential. The MoF publishes a “Citizens’ Budget” each year, simplifying the budget so the public can understand what government plans to deliver, who is responsible, and how much it will cost.

In theory, this enables civil society, media, Parliament, and citizens to track delivery—such as whether schools are built, roads repaired, and clinics stocked. In practice, challenges remain: weak MDA capacity for planning and execution, delays, and coordination problems. Civil society has also raised concerns about underfunding in critical sectors like health, agriculture, and social services, despite their national priority status.

Recent developments and fiscal strategy

Sierra Leone has implemented reforms to reinforce fiscal discipline, strategic alignment, and transparency. The Public Financial Management Act, 2016 (PFM Act 2016) introduced procedures for budget preparation, expenditure controls, and accountability.

Under the PFM framework, government regularly produces a Fiscal Strategy Statement (FSS), outlining medium-term fiscal objectives and budget allocations for the next three years. These reforms aim to ensure budgets are part of a predictable multi-year framework—strengthening the link between national development plans, budget allocations, and actual spending.

In late 2025, government prepared the FY 2026 budget with a dual focus: stronger domestic revenue mobilization and directing revenues to strategic investments in human capital, infrastructure, food security (“Feed Salone”), and other Big Five priorities.