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The government of Ghana’s mid-year fiscal policy review of the 2017 budget statement and economic policy received stiff opposition from the Minority side of Parliament on Monday when the Finance Minister, Ken Ofori Atta appeared in the House for his presentation.
The Minority, led by it’s leader, Mr Haruna Iddrisu, pointed out that the Finance Ministry failed to meet section 28 of the Public Financial Management Act, Act 921, as such the Finance Minister should not present a budget review statement to the House.
According to Mr Iddrisu, the minister is mandated by law to present such a statement to parliament by the end of June 30 of each year but this the minister failed to do.
Speaker of the House, Rt. Hon. Micheal Aaron Oquaye interrupted to explain that the minister was in to make a statement but not a review.
On this intervention by the Speaker, the Minister of Finance was allowed to read his statement which took about two hours.
The Finance Minister announced the government’s plan to acquired some 800 buses to improve public transportation while other attempts are being made for the completion of the Tema-Akosombo railway line by mid-2020.
Mr Ofori Atta lamented that the previous government signed too many Power Purchase Agreements beyond what the country needed and that the current government is reviewing all such contracts.
On pro-poor initiatives, the Minister said the School Feeding Program currently covers about 1,671,777 children in 216 districts and employs over 4,700 caterers.
“Mr Speaker, some 149m cedis has been budgeted as allowance for health trainees in 2017. NHIS is under-restructuring. Some 56 million paid to LEAP beneficiaries as at July 2016,” he stated.
He said the free SHS is ready for those who pass BECE and will enjoy the intervention for the entire duration of the program. Saying 30% of SHS placements will be reserved for public Junior High Schools.
Mr Ofori Atta pointed out that cocoa output has declined to around 800,000 tonnes per annum over five years. He was of the assurance that Government will work around the clock to hit 1million tonnes target through Mass cocoa spraying exercise which will include private sector participation and cocoa rehabilitation plans to boost production.
He also told the house that fall armyworm reported in April, has affected maize and cow pea most severely and that about 74,000 litres of chemicals have been procured to address the situation.
185,00 farmers registered against a target of about 200,000. Some 56,000 bags of improved seeds of maize and rice have been distributed to farmers across regions. Fertilisers have been subsidized, he stated.
The minister announced that government will soon bring to parliament an amendment to the Public Financial Management Act (PFMA) to limit fiscal deficit to 3.5% in any fiscal year.
Saying Nominal GDP has also been revised as has non-oil tax revenue: Corporate income tax, import taxes collection revised downwards while the fiscal deficit has been reduced from 6.5 to 6.3% of GDP.
The Finance Minister however, assured the house that the Free SHS, School Feeding, Planting for Food and Jobs, NHIS will be protected from budget cuts.
“Mr Speaker government has chosen debt management strategy: Borrow at minimum cost to reduce re-financing risk and reprofile debts which does not increase the debt stock,” he reiterated.
According to him government’s macro-economic targets for 2017 has been met and that interventions put in place are working and in some cases exceeding expectations.
Mr Speaker, the GDP of first quarter hits 6.6% as against 4.4 same time last year. Fiscal deficit: 2.7% compared to 4% compared to 2016. BoG cut policy rate by 21%.
According to him the Gross international reserves is 3.4 months equivalent to 2.8 months as at last year first quarter. While Interest rates have gone down by more than 500 basis points because of consitent fall in headline inflation.
“Average interest rate 16.81% to about 12% in June 2017. Ongoing investigations have unearthed massive under-declaration at the ports,” he noted.
“Government is clearing arrears and investigating it in an audit expected to end October. The Finance Minister assured.
Source: Franklin Asare-Donkoh