Libya's House of Representatives approves parallel government's budget, deepening institutional rift

Libya's eastern prime minister, Fathi Bashagha, relies on the Libyan central bank to finance spending
Fathi Bashagha

PHOTO/HoR  -   The prime minister of the parallel government, Fathi Bashaga, during a meeting in Misrata with social, military and academic leaders

The rift between Libya's parallel administrations is widening and seems irreversible. The eastern House of Representatives on Wednesday approved the annual budget of the cabinet of Fathi Bashagha, the prime minister elected in February as part of a new institutional division in the face of the inability of the head of the Government of National Unity (GNU), Abdel Hamid Dbeibé, to hold elections. This is the first time in eight years that the legislature has approved a national budget. 

The budget passed unanimously. As many as 103 MPs took part in the vote, 98 from headquarters in Sirte and five by videoconference, although the Constitution stipulates that at least 120 of the 200 members of the House must be present for the general budget to be passed. Moreover, the vote is passed with the backing of two-thirds plus one, so 17 votes short of the 120 needed. 

The East maintains that the constitutional breach is due to the resignation or death of some deputies. The body has not been subject to electoral scrutiny since 2014 and has rejected up to five budget proposals made by the Dbeibé-led executive in the last year, since the GNU was established in Tripoli at the end of the Geneva peace process.

Banco Central de Libia
PHOTO/BCL  -   From left to right, interim Prime Minister Abdul Hamid Dbeibé, President of the Presidential Council Mohamed Menfi and President of the Central Bank of Libya Saddek Omar El-Kaber

Parliament approved the mobilisation of 90 billion dinars, according to spokesman Abdullah Blehiq, equivalent to around 18 billion euros. This is less than the amount proposed by Bashagha to "rebuild the state", which called for a budget of more than 94 billion to be divided into four spending chapters, of which 41 billion would go to salaries, 8 billion to management and operating costs, 17 billion to development and reconstruction programmes and, ultimately, 26 billion to public subsidies, according to authorities in the east. 

The budget approval has been seen by Tripoli as a move to exert more pressure on the internationally recognised government of Misrata businessman Abdel Hamid Dbeibé, who some believe is responsible for a new institutional duplicity like the one Libya experienced in 2014 with the outbreak of civil war. From the east, however, they claim that this is not a movement against, but in favour, and that the new budget will help fight corruption. 

The newly reunified Central Bank of Libya (CBL) and the Tripoli-based Audit Bureau will have to decide whether or not to approve Bashagha's budget. The CBL, whose governor, Saddek Omar El-Kaber, has been in office since 2011 and concurrently chairs the Manama-based Arab Banking Corporation bank with an office in London, is likely to refuse to make the disbursement because of the agency's disagreements with the authorities in the east. 

El-Kaber refused to meet a few weeks ago with the speaker of the House of Representatives, Aguila Salé, where Marshal Khalifa Haftar's partner intended to negotiate the financing of the budget for the parallel government before it was even approved in parliament. Eastern sources insist that the CBL is a sovereign institution under the authority of the legislative body, which is the House of Representatives. They are therefore accountable to the House of Representatives, and it is the House that appoints or dismisses the head of the CBL. 

"[ The Central Bank of Libya] must follow the directives of the legislative body. This has always been the case in Libya, even during the Gaddafi regime," sources who prefer to remain anonymous tell Atalayar. "The previous legislature appointed Saddek and the House of Representatives allowed him to remain in his post". For this reason, Salé declared in May that if the CBL and other "obstructive" bodies refuse to fund Bashagha's executive, they would face criminal consequences under the Constitution.

"The House of Representatives does not have the power to change the CBL Governor under the Libyan Political Agreement. They need the Council of State to also agree under Article 15 of the Constitution. If they could remove him, they would have done it a long time ago. They tried before, appointing a new CBL governor, but the world ignored this unilateral move," Libyan analyst Ahmad Sehweli tells Atalayar. 

The scenario of political fragmentation has also led to an almost complete halt in oil production in the country. The Oil and Gas Ministry this week announced an 85% drop in production as a result of the blockade of oil facilities by anti-Dbeibé protesters, according to Reuters.

Fathi Bashaga
PHOTO/HoR  -   The Prime Minister of the parallel government, Fathi Bashagha

Libya is once again facing the abyss after proving unable to hold general elections scheduled for 24 December. Libyan analyst Ahmed Sewehli told Reuters that the failure was due to "legal problems". "The House of Representatives led by Aguila Salé decided to pass its own electoral laws, without even having the backing of the entire parliament, which were not approved by the Presidential High Council". There was no consensus to establish a single binding legal framework. 

Dbeibé came to power on the back of the Libyan Political Dialogue Forum (LDPF), held in Geneva with the task of getting the electoral process back on track. He did not succeed, and from the east they claim his mandate expired in December. Meanwhile, Tripoli accuses the eastern authorities of obstructing the transition process. "Dbeibé was elected by a group of 75 people representative of Libyan society within the framework of the UN. On the other ticket were Bashagha and Salé, and they lost. They have been sabotaging the process because they did not accept defeat. They want to be in power," Seweheli argues. 

Authorities in the west believe that the House of Representatives is trying to impose Bashagha's mandate in order to perpetuate itself in power. "Bashagha disowns the Tripoli government despite having fought on its side three years ago during the battle for the capital when he served as interior minister in Fayez Al-Sarraj's government of national accord," the Libyan analyst stresses. "He switched to the other side a year ago".