The Finance Minister, Ken Ofori-Atta has detailed the management technique government has had to adapt to run the country effectively due to the legislature’s “failure” to approve some major revenue streams in the 2022 budget.

According to him, the Akufo-Addo administration has had to truncate some of its expenses to meet the fiscal deficit.

“Government had already started the new year with spending cuts as Parliament failed to approve key revenue streams at the appropriate time,” he said at a press briefing on Thursday.

With the controversial Electronic Transaction Levy (E-levy) a major tax policy that has still not been approved, Mr Ofori-Atta said his outfit has strengthened its expenditure monitoring systems and processes.

This, according to him, is to ensure effective implementation of the expenditure cut down government has implemented.

“In January 2022, government announced and, immediately, began implementing a 20% expenditure cut as part of fiscal stabilisation and debt sustainability measures.

“This has been done through the quarterly expenditure ceiling allotments to MDAs [Ministries Departments and Agencies]. Quarter 1 allotment is currently under 11 implementation whiles Q2 allotments will be issued shortly,” he said.

E-levy, since it was announced last year, has been met with mixed reactions.

The governing New Patriotic Party (NPP) has argued that the tax policy will assist fuel the development transformation of the country. However, the Minority in Parliament says the levy will only intensify the hardship of the average Ghanaian.

Meanwhile, with many citizens lamenting about economic challenges and hikes in fuel prices, the Minister also announced certain cuts that are to mitigate the economic hardship.

The Interventions

• Discretionary spending is to be further cut by an additional 10%.
• 50% cut in fuel coupon allocations for all political appointees and Heads of government institutions, including SOEs, effective 1st April 2022.
• Imposition of a complete moratorium on the purchase of imported vehicles for the rest of the year with immediate effect. This will affect all new orders, especually 4-wheel drives. This is geared towards reducing uce total vehicle purchases by the public sector by at least 50 percent for the period.
• Government has imposed a moratorium on all foreign travels, except pre-approved critical/statutory travels.
• Government will conclude on-going measures to eliminate “ghost” workers from the Government payroll by end December 2022;
• Government will conclude the renegotiation of the Energy Sector IPPs capacity charges by end of Q3-2022 to further reduce excess capacity payments by 20% to generate a total savings of GHS1.5 billion;
• Impose a moratorium on establishment of new public sector institutions by end April, 2022.
• prioritise ongoing public projects over new projects to enhance the efficient use of limited public funds over the period by finishing ongoing or stalled but approved projects.
• Reduce expenditure on all meetings and conferences by 50%, effective immediately.
• Heads of SOEs to contribute 30% of their salaries from April to December 2022 to the Consolidated Fund.
• Pursue a comprehensive re-profiling strategies to reduce the interest expense burden on the fiscal; and liaise with Organised Labour and Employers Association to implement with immediate effect, the measures captured in the Kwahu Declaration of the 2022 National Labour including reforms towards addressing salary inequities / inequalities (e.g. Article 71 Office Holders), the weak link between pay to productivity and the sustainability of the payroll.