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The Chairman of the Parliament Finance Committee, Dr. Mark Assibey-Yeboah, revealed that Ghana’s total national debt at the end of August 2020 was ¢ 267 GH.
7 billion, which represents 69.7 percent of the Gross Domestic Product (GDP).
According to him, this figure differed from the 76.6 percent of GDP published by the International Monetary Fund (IMF) because the IMF had projected the debt figure for the end of 2020.
It also included non-central government liabilities, which are generally not included in the calculation of the national debt.
Dr. Assibey-Yeboah made the disclosure when the House approved GH ¢ 27.43 billion of Expenditures before Appropriation for January to March 2021.
The amount would be obtained from the Consolidated Fund in order to cover the expenses necessary to carry out government services with respect to the period that expires three months of the Fiscal Year.
The Minister of Finance, Ken Ofori-Atta, presented this Wednesday to the Chamber the Anticipated Expenditure on Appropriation from January to March 2021, and requested his approval to withdraw from the Consolidated Fund an amount of GH ¢ 27.43 billion to cover expenses necessary to continue government services for the period that expires three months of the financial year.
The presentation is in accordance with Article 180 of the 1992 Constitution and the House Rules.
Dr. Assibey-Yeboah gave the breakdown of the appropriation as: GH employee compensation ¢ 7.7 billion; Goods and Services such as GH ¢ 1.59 billion; GH interest payments ¢ 7 billion; GH subsidies ¢ 259 million and Donations to other government units GH ¢ 4,340 million.
The rest are; GH social benefits ¢ 41.2 million; other GH expenses ¢ 813.6 million; Capital Expenditures GH ¢ 1.9 billion; Delayed settlement GH ¢ 350 million and Amortization GH ¢ 3.42 billion.
Dr. Assibey-Yeboah announced that the Comptroller and Accountant General have been instructed to ensure that all Ministries, Departments, and Agencies operate strictly within the levels established in spending prior to allocation and under no circumstances should funds be transferred from the Compensation of employees to cover items of expenses for goods and services or capital expenses, except with the prior approval of the Ministry of Finance.
He warned that the votes provided in the estimates would not be allowed to be used to defray the debt carried over from the 2020 financial year, except as provided in the estimates.
Mr. Kojo Oppong Nkrumah, Minister of Information, indicated that the ¢ 350 million GH destined to the settlement of arrears, part of them, are to cover the arrears inherited by the government from 2016.
He explained that GH ¢ 7 billion allocated for the payment of interest is not only for the 2017 interest payment so far, but to pay all pending liabilities for which interest is owed.
He recalled that two important items had contributed to the growing debt of the country, added to the already existing debt of ¢ 122 billion GH.
These are the energy sector payments of about $ 1 billion a year (over GH5 billion) and the interest associated with that and the over GH ¢ 21 billion borrowed for the cleanup of the financial sector with its corresponding interest.
Minority leader Haruna Iddrisu criticized the Finance Minister for not sharing with the People’s Representatives the performance of the Ghanaian economy during the first, second third quarters of 2020, so that Ghanaians understand the true state of the economy .
He said that Mr. Ofori-Atta should also have shared with the Chamber the economic impact of Covid-19 on employment, income and expenses.
“So that we can understand the type of economy, it is likely that we will inherit after December 7, 2020. We know that we would inherit a fragile fractured economy recovering from Covid-19,” said the minority leader.
Iddrisu also expressed concern about the country’s growing public debt, which stands at 69.7 percent of GDP, and said Ghana is at risk of becoming a debt-strapped country.
“We are almost on the threshold of a 70 percent over-indebtedness,” he said.
He urged the Finance Minister to explain to the House why the IMF projects Ghana’s debt by the end of 2020 to be 76.6 percent of GDP, but the government’s figures are different.
He asked if the government is providing different sets of data to the IMF and Parliament.
