Ghana’s Minister of Finance and Member of Parliament for Ajumako Enyan Essiam, Dr. Cassiel Ato Forson, has announced a set of significant expenditure measures in the 2025 Budget.
These measures, according to the Minister, aimed at strengthening fiscal discipline, enhancing efficiency in public spending, and ensuring effective fiscal consolidation.
The measures, when implemented in the 2025 fiscal year and beyond, are expected to help stabilize Ghana’s economy and optimize resource allocation.
“We will conduct a comprehensive audit to validate the quantum of arrears/payables and commitments as at 31st December 2024 before payment; the mandatory use of the ‘Blanket Purchase Order’ ‘to capture multi-year commitments/contracts in line with Medium Term Expenditure Framework ceilings;”
Dr Cassiel Ato Forson,Ghana’s Minister of Finance
The 2025 Budget also includes amendments to the Public Procurement Act to enhance value-for-money assessments in government procurements.
One major change is the establishment of an Independent Value-for-Money Office, which will scrutinize procurements exceeding a threshold to be determined by Parliament. This move is intended to prevent inflated contract pricing and improve efficiency in public spending.
Furthermore, the Public Procurement Act will be amended to ensure that commencement certificates and budgetary provisions become prerequisites for all central government procurements.
This, according to the Finance Minister, will prevent the government from engaging in projects without secured funding, reducing the risk of arrears accumulation.
To enhance efficiency and transparency, the Finance Minister indicated that the government will fully integrate the Ghana Electronic Procurement System (GHANEPS) with the Ghana Integrated Financial Management Information System (GIFMIS).
This integration will ensure that only Ministries, Departments, and Agencies (MDAs) projects and purchase orders with approved budgets and allotments can receive procurement approvals.
The Finance Minister further disclosed that a Compliance Desk will be operationalized at the Ministry of Finance to monitor and report on commitments and arrears accumulation.
Additionally, a Public Financial Management (PFM) League Table will be introduced to rank compliance levels across government entities, promoting greater adherence to fiscal rules.
Here, Dr Forson stressed that strict enforcement of sanctions under sections 96 to 98 of the Public Financial Management Act (PFM Act) will also be pursued, particularly for breaches related to arrears accumulation and commitment control.
Cutting Wasteful Expenditure
Moreover, the Minister of Finance indicated that as part of the fiscal consolidation program, the government will eliminate inefficient and duplicative programs that contribute to unnecessary expenditures.
“In this regard, selected expenditure items including the GhanaCARES, the YouStart and the One District One Factory will be eliminated;”
Dr Cassiel Ato Forson,Ghana’s Minister of Finance
Additionally, Dr Forson indicated that the functions of the Development Authorities—Coastal Development Authority (CODA), Northern Development Authority (NDA), and Middle Belt Development Authority (MBDA)—will be reassigned to District Assemblies.
This restructuring, according to Dr Forson, aims to decentralize decision-making and improve the efficiency of development programs at the local level.
In addition, the government proposed key amendments to the Petroleum Revenue Management Act, 2011 (Act 815) to ensure that Annual Budget Funding Amount (ABFA) resources are allocated entirely for infrastructure projects.
Also, the National Health Insurance Levy (NHIL) and the Road Fund will receive full allocations under the Earmarked Funds Capping and Realignment Act, 2017 (Act 947). These measures aim to strengthen the financing of critical sectors such as healthcare and road infrastructure.
To optimize the management of Ghana’s natural resource revenues, Dr Forson indicated that the government will reduce the Ghana National Petroleum Corporation’s (GNPC) share of net Carried and Participating Interest (CAPI) from 30% to 15% while restoring transfers to GNPC under the Earmarked Funds Capping and Realignment Act.
Similarly, amendments to the Mineral Income and Investment Fund (MIIF) Act will ensure that 80% of mineral royalties maintained by MIIF are transferred to the Consolidated Fund for infrastructure development.
Strengthening Social Protection
A major highlight of the 2025 Budget is the strengthening of social protection programs to cushion vulnerable populations.
The government will introduce several new social intervention initiatives, including: the No-Academic-Fee Policy – in which first-year students in public tertiary institutions will not be required to pay academic fees under the ‘No-Fees-Stress’ initiative.
He stressed the NDC’s administration’s commitment to the implementation of the Free Tertiary Education for Persons with Disabilities (PWDs) to promote inclusivity; PWDs will benefit from full tuition-free tertiary education.
Other social protection announced by Dr Forson include the rollout of the Free Primary Healthcare –a new initiative to provide universal primary healthcare access to all citizens and Ghana Medical Care Trust (MahamaCares) – a healthcare financing initiative to ensure sustainable funding for essential medical services.
The Free Sanitary Pads for Schoolgirls initiative, according to Dr Forson, will provide free sanitary pads to schoolgirls, addressing menstrual hygiene challenges and improving school attendance among girls.
Dr. Cassiel Ato Forson’s expenditure measures in the 2025 Budget signal a strong commitment to fiscal prudence, enhanced efficiency, and social welfare.
By implementing rigorous expenditure controls, strengthening public financial management, and enhancing social protection initiatives, the government aims to achieve sustainable economic stability and inclusive development.
READ ALSO: Uganda Deploys Troops to South Sudan to Beef Up Security
