In the last month Sudan’s Government has forfeited the title “˜of National Unity.’ Cooperation between the NCP and SPLM hardly exists even in name. This week poses an important test of whether it warrants the name “˜Government’ at all.

Sudan long ago failed many of the basic tests of governance. It doesn’t possess a monopoly on the use of force, doesn’t command the allegiance of large sections of its citizenry. But one test that it usually meets is paying the salaries of civil servants for the most important Muslim holiday, the Eid al Adha. This year the Eid falls at the end of this week, probably on Friday 27th. Muslims are expected to buy and slaughter a sheep. When the Eid falls towards the end of the month, established practice is for employers to pay salaries early so that employees can have cash in hand for the holiday. This year, the government hasn’t yet met this obligation. It seems to have run out of cash itself.

This shortcoming is all the more striking when we note what has happened to public spending since the CPA. Due to the oil boom, all components of expenditure were expanding between 2000 and 2008. After the CPA, international donors pledged huge amounts for post-war reconstruction. Many of those pledges were not met, but the high price of oil more than compensated for any shortfall. Khartoum and Juba could have financed the peace dividend themselves without international assistance.

In fact, the pattern of post-CPA expenditure has been very different. The budget categories that have expanded most rapidly, taking up the great majority of the additional spending, are salaries and security/defence. Both the Federal Government and the Government of South Sudan have treated peace as an obligation to put vast numbers of people on the official payroll. Capital spending has been neglected, with the notable exceptions of the oilfields, the Merowe dam, and infrastructure in and around Khartoum.

Much of this spending pattern reflects the commitments in the CPA, DPA and ESPA. “˜Power sharing’ consists largely of creating vast numbers of new governmental positions. Federalism is another mechanism with similar logic. Almost the whole spending of state governments, and even more so lower levels of administration, is on personnel. Peace agreements are vast employment generation schemes, jobs for the boys.

There must be a better way of designing a peace agreement, than as a patronage based buyout. But, given that this is the agreement that Sudan has got, it should be made to work.

Security and defence spending is less easy to analyze, but it appears that a disproportionately high level of it consists of putting soldiers, policemen and paramilitaries on the payroll. Considerable amounts of this are off-budget, and the recipients of this largesse are not on official record.

A vast expansion of public sector employment is Sudan’s peace dividend. If this were consolidating peace it would be politically justifiable, despite the economic distortions it brings. But, in advance of the 2010 elections and 2011 referendum, and with the NCP facing political-military challenges in Darfur, this spending resembles more than anything a kind of loyalty payments arms race. Both the NCP and SPLM are trying to extend their patronage systems as much as possible, competing with one another and the various other political parties and armed movements. This spending represents an ever-higher proportion of the budget.

In Sudan’s political marketplace, political competition is driving up the demand for loyalty, and consequently the price. The costs of simply running the patronage based political system are consuming the resources available to Khartoum and Juba, and more. At some point the Government will no longer have the money to pay the bill.

When a government fails to pay soldiers and militiamen, or cannot provide enough to satisfy its local powerbrokers, we would expect an increasing pace of rural violence. When a government fails to pay its civil servants, on the eve of the year’s biggest festival, we would expect its legitimacy to be compromised among those who should be its main constituency. (A failing compounded by a sudden increase in the price of sugar, another barometer of meeting basic needs.) And insofar as the public sector payroll is the chief dividend of the CPA for the citizenry, such a failure also marks a milestone in the decay of that agreement.

I hope that for the sake of the many thousands of Sudanese civil servants who depend on a timely salary payment to be able to celebrate the Eid properly, that the Sudan Government finds a way to pay its bills, in the few days left before the holiday. Equally, it must do so for the sake of the CPA.