The government of Ghana has indicated its intention to overrun its budget in the first three months of 2021 by GH¢10.7 billion.
According to the minister of finance, the projected 2021 Q1 total revenue and grants is estimated at GH¢13.3 billion while total expenditure including the clearance of arrears is projected at GH¢24.0 billion. Thus, this is what will result in the projected fiscal deficit of GH¢10.7 billion for the period.
This, he indicated in the 2021 budget statement presented on the floor of the house on October 28, 2020.
Mr. Ofori-Atta pointed out that to support the 2021 budget and liability management, the government plans to source funding from the international capital market.
This will comprise the issuance of sovereign bonds of US$3 billion with the option to increase it to US$5 billion should market conditions prove favorable. Out of the amount to be raised, US$1.5 billion will be used to support the 2021 budget and US$3.5 billion for liability management.
According to the Finance Minister, the government will require an amount of GH¢27.4 billion to carry on the services of government until the expiration of three months from the beginning of the 2021 Financial Year.
A total of GH¢7.71 billion is expected to be spent on Compensation of Employees, representing 28 percent of the proposed budget appropriation. The government is also expected to spend GH¢7.0 billion on Interest Payments, which is higher than the GH¢ 4.3 billion earmarked for Grants to Other Government Units.
“The total amount is to cover Government operations, such as Compensation of Employees, ex gratia awards, Interest and Amortization payments, transfers to Statutory Funds, critical programs and Goods and Services, and Capex allocations of MDAs”, Mr. Ofori-Atta said.
Prominent among the programs to be undertaken by the government within the period as pointed out by the finance minister is work on the (Agenda 111) District and Regional Hospitals, which the finance minister said has commenced in 2020 to ensure health facilities are available in all deprived places.
The finance minister further stated that “currently, 88 site plans have been submitted by the district assemblies and contractors and consultants are being procured. The rehabilitation of the Effia Nkunta and Accra Psychiatric hospitals and the construction of the two Psychiatric hospitals in Kumasi and Tamale will be fast-tracked”.
In addition to the 88 site plans and the rehabilitation of the Psychiatric hospitals, Mr. Ofori-Atta revealed that funds have also been provided to facilitate the reopening of schools in the early part of 2021 if the country continues to keep the spread of new infections of the COVID-19 virus at its current low levels.
Touching on how the government plans to empower the youth to venture into entrepreneurship and to create jobs to address the problem of unemployment next year, Mr. Ken Ofori-Atta said;
“In furtherance of the Government’s TVET agenda, next year will witness the start of the JOBS and SKILLS project to support apprenticeships and competency-based training curriculum development in over 100 trade areas and entrepreneurship.
“Also, we will see the beginning of construction of our flagship State of the Art TVET centers (two per region), fully equipped with modern training facilities in 33 trades/professions across”.
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