Ghana’s Finance Minister, Ken Ofori-Atta, is finally scheduled to present the long-awaited mid-year budget review to parliament on Thursday July 23, 2020.
This is in accordance with Section 28 of the Public Financial Management Act, 2016 (Act 921). According to sources, the presentation of the statement on the review of government projections for the 2020 financial year will be backed by a request for supplementary estimates.
The government’s projection in various sectors for the 2020 financial year have largely been affected by the economic implications caused by the novel coronavirus pandemic.
The Minister is also expected to provide Parliament with a clear plan on how the government intends to pay back the GH¢10 billion it borrowed from the Bank of Ghana (BoG) and the 219 million dollars transferred from the Stabilization Fund to the Contingency Fund to help deal with the impact of the COVID-19 pandemic.
Future borrowing to cover up for expenditure dangerous for economy – Economist
An Economist, Dr. Adu Owusu Sarkodie has said the Finance Minister, Ken Ofori-Atta, should outline the government’s progress so far with the allocation of support under the Coronavirus Alleviation Programme (CAP) when presenting the 2020 Mid-year budget review to Parliament later this month.
Dr. Sarkodie is of the view that limiting budgetary allocation is critical of which an increase could impact the country’s budget deficit; that is the difference between revenue and expenditure.
He also added that the presentation should see a review of all key economic indicators such as growth rate, primary balance, budget deficit, revenue and expenditure targets, among others.
“In all these, I think the Finance Minister should be able to tell us how far we have come with this program. What is needed to be done and how we are going to revive our economy and make sure that, we come back on track. So, there must be a review of everything,” he said.
However, Dr. Adu Sarkodie maintained that Mr. Ofori-Atta is likely to fall on the GH¢9.5 billion Coronavirus Alleviation Programme and the Bank of Ghana’s GH¢10 billion support to cover these differences.
Meanwhile, he says the steady pickup in economic activities especially in the informal sector of Ghana’s economy, which witnessed some losses earlier, could see improvement by the time the Finance Minister appears before Parliament.
“The first quarter figures indicate that we grew by 4.9% as against 6% last year, first quarter. So, it is very likely that we will do better than the 1.5% projected. Our reasons been that the Ghanaian economy is largely informal and because the lockdown has been lifted many people have gone back to work and therefore it is very likely that we will do better than the 1.5,” he added.
