The mid-year
budget review was not candid and truthful to Ghanaians about the economic
challenges facing the country, the Minority in Parliament has said.
According to them, the country was in serious economic crisis, to the extent
that its debt was unsustainable, but the Minister of Finance, Ken Ofori-Atta,
failed to speak the truth to encourage Ghanaians to buy into the problems
confronting the nation.
“I am disappointed in the statement by the minister. I think if the country is
in crisis, to extent that your debt is unsustainable, then when you appear
before Parliament, first you have to speak the truth to get the public buy-in,”
the Ranking Member on the Finance Committee of Parliament, Dr Cassiel Ato
Forson, said.
Addressing the press shortly after Mr Ofori-Atta had presented the mid-year
budget review to Parliament yesterday, Dr Forson, flanked by some members of
his caucus, said: “Everything is not working, yet the Minister responsible for
Finance appeared before us and said nothing. He failed to address the very
concerns of ordinary Ghanaians.”
Mounting debt
Dr Forson said he was shocked that the government felt every challenge facing
the country must be confronted with debt.
Such thinking, he said, largely contributed to the country’s public debt that
was today in excess of GH¢400 billion but which the Finance Minister failed to
talk about.
“I thought he would take the opportunity to address debt restructuring,” he
said, adding: “Today, Ghana is a highly indebted middle-income country and our
position is worse than the HIPC days.”
The Ranking Member further said when the 2022 budget was read in November last
year, it got investors very jittery, as a result of which they started exiting
Ghana’s market.
Today, he said, the Finance Minister’s mid-year review of the 2022 budget was
worse, describing the document as “nothing but empty”.
Fiscal deficit
Dr Forson said the Bank of Ghana reported to Parliament that in the first half
of this year, the fiscal deficit was approximately six per cent, yet the
Finance Minister told the House that by the end of the year, the fiscal deficit
would be six per cent again.
“How possible is it that at the time you have revised your revenue down to
GH¢3.7 billion and you have cut expenditure by only GH¢1.8 billion, which means
the net effect is that you are increasing your fiscal deficit by GH¢2 billion,
he tells us the fiscal deficit is coming down?” he quizzed.
GDP growth
The Ranking Member also recalled that Mr Ofori-Atta told the House that GDP
growth for 2022 had been revised from 5.8 to 3.7 per cent, saying: “I bet to
say that he cannot even achieve the 3.7 per cent.”
He pointed out that Fitch had given information that the GDP growth for 2022
for Ghana would be 2.5 per cent, which would be the worst in the history of the
country.
Printing currency
Dr Forson accused the government of encouraging the Bank of Ghana to print
currency totalling GH¢22 billion without parliamentary approval.
According to him, the currency notes were printed between January and June
2022, explaining that the information was hidden on page 97 of Appendix 2a of
the Mid-year budget under the section on the Bank of Ghana.
“They have printed GH¢22 billion fresh money without the knowledge of
Parliament and without informing all of us,” he said.
Describing the development as against the Bank of Ghana Act, Dr Forson said the
printing of the currencies had been a contributory factor to the galloping
inflation.
“No wonder inflation is galloping, no wonder that our reserves position is dwindling.
Because when you create new money out of thin air, what happens is that
inflation will go up, and obviously because it is new money, you will end up
losing your reserves because there will be new consumption,” he said.
“If this trend continues, I won’t be surprised that we will end the year with
inflation of about 50 per cent,” he said.
No clear path
Reacting to the mid-year budget review on the floor of Parliament, the Minority
Leader, Haruna Iddrisu, said the minister failed to give hope and a clear path
of how the government intended to cushion the people against the rising cost of
living, the escalating cost of doing business and extreme poverty.
“I cannot see any respite; I cannot see my way clear and I cannot see any hope
for suffering Ghanaians,” he stated.
Varying interest payment
He told the House that Mr Ofori-Atta was seeking to vary interest payment from
GH¢37.4 billion (7.5 per cent of GDP) to GH¢41.3 billion (7.0 per cent of GDP),
a development over which he expressed the Minority’s intention to raise
procedural issues to guide the House.
“Mr Speaker, is this a matter over which a mere statement from the Minister of
Finance allows him to adjust appropriation?” he asked, citing how the existing
Appropriation Act gave the minister the mandate for only GH¢37 billion.
Mr Iddrisu accused the Finance Minister of nurturing the intention to
re-introduce road tolls through the back door.
Majority Leader reacts
The Majority Leader, Osei Kyei-Mensah-Bonsu, denied the assertion by the Minority
Leader that the Finance Minister intended to use the mid-year review to
introduce new road tolls.
“Read what is there and do not mislead Ghanaians; the truth of the matter is we
all do acknowledge that as a nation we have not been reaping enough from road
tolls.
“Due to the damage that was done at the tollbooth area, it was decided that we
should do away with road tolls for the time being. No law made is sacrosanct,”
he said.
Mr Kyei-Mensah-Bonsu explained that what the government intended to do was electronically
re-introduce road tolls.
Source: graphiconline.com