Ghana Parliament Approves GH¢27.4 bln (US$4.7 bln) Budget For 1st Qtr of 2021
Parliament has by resolution approved the GH¢27.4 billion the government is requesting for expenditure for the first quarter of 2021.
The approval came barely two days after the Minister of Finance, Mr Ken Ofori-Atta, came to the House to request the approval of the amount as expenditure in advance of appropriation to carry on the services of the government from January to March next year.
The approval was preceded by a low-key debate from both sides of the House that supported the motion for the budget to be approved.
The Chairman of the Finance Committee, Dr Mark Assibey-Yeboah, moved the motion for the House to adopt its report and approve it by resolution the GH¢27.4 billion, a motion which was seconded by the Minority Leader, Mr Haruna Iddrisu.
Presenting the report, Dr Assibey-Yeboah highlighted the anticipated expenditure to be covered by the budget for the first quarter of next year.
He said GH¢7.7 billion would be used to pay compensation of employees, GH¢1.6 billion for use of goods and services, GH¢7 billion to service interest payments, GH¢259 million as subsidies, GH¢4.3 billion as grants to other government units, GH¢41.3 million as social benefits, GH¢1.9 billion for capital expenditure and GH¢813.6 million for other expenditure.
He told the House that the total revenue and grants for the first quarter of 2021 was projected to amount to GH¢13.3 billion (equivalent to 3.0 per cent of GDP).
Total tax revenue for the period of January to March 2021, he said, was expected to amount to GH¢10.4 billion, while non-tax revenue was expected to reach GH¢1.9 billion.
“Total expenditure for the first quarter of 2021 is projected at GH¢23,664,596,915, representing 5.3 per cent of GDP. Of this amount, capital expenditure for the period is estimated at GH¢1,903,658,408.
“Total budget for the first quarter contains an overall deficit balance of GH¢10,674,343,415, representing 2.4 per cent of GDP. This deficit is the excess of projected expenditure over revenue for the first quarter of 2021,” he said.
True state of economy
Supporting the motion, the Minority Leader, Mr Haruna Iddrisu, said the Finance Minister should have shared with Ghanaians the impact of COVID-19 on economic performance, revenue mobilisation, employment and expenditure.
He said the minister indicated total public debt to be 69.7 per cent of GDP, which was almost at the threshold of debt distress of 70 per cent.
He said the IMF quoted Ghana’s debt to be 76.4 per cent, contrary to the data the Finance Minister gave Parliament; and, therefore, asked the minister to come clear on the country’s debt situation.
“If we do not get the statistics right of debt as a percentage of GDP, we will not get the other figures and inflation right,” he said, and accused Mr Ofori-Atta of treating the banking sector clean-up as a footnote when he presented the mid-year budget review.
“That is not appropriate as it is an expenditure of GH¢21 billion committed, and you must add it up to your expenditure in order to compute accurately,” he said.
Reacting, the Majority Leader, Mr Osei Kyei-Mensah-Bonsu, discounted the claims by the Minority Leader that the Finance Minister failed to tell Ghanaians the true state of the economy.
He said the previous administration borrowed in eight years about $49 billion as compared to the current government which had added about GH¢21 billion.
Credit: Graphic Online
(BY: Nana Konadu Agyeman)