Finance Minister Dr. Mohammed Amin Adam has announced that the Ghanaian government plans to establish an independent fiscal council to help prevent excessive borrowing and promote long-term economic stability.

The proposal, according to him, is part of broader efforts to reinforce fiscal responsibility as Ghana navigates the aftermath of its domestic debt crisis, a challenge that has heightened concerns over sustainable debt management.

Speaking at the 2024 Annual Meetings of the International Monetary Fund (IMF) and the World Bank Group on Wednesday, October 23, Dr. Amin Adam shared details of the initiative.

He emphasised the council’s critical role in safeguarding Ghana’s economic health by monitoring government borrowing practices and ensuring adherence to debt limits designed to prevent a repeat of past financial struggles.

The Finance Minister explained that the fiscal council would operate as an autonomous institution, separate from direct government oversight.

This independence is seen as essential for its objective monitoring of the country’s debt and fiscal policies, creating a mechanism for accountability that would withstand changes in government administrations.

Dr. Amin Adam outlined that the council’s primary task would be to enforce fiscal discipline, especially in relation to borrowing and debt repayments.

The council will establish new fiscal rules, ensuring that Ghana maintains debt levels that are manageable and aligned with its economic goals, ultimately contributing to a stable financial environment.

“The domestic debt we did was a very painful exercise because people did not expect that. So to have taken the people of Ghana through this painful exercise has meant that they had to sacrifice beyond what many people could do. And because of that, they are demanding fiscal discipline, they are demanding fiscal stability, and that is why it will be very difficult to go back to the era of unsustainable debt."

“The second measure we are putting in place is the implementation of far-reaching structural reforms, you know, to build our resilience. And one of the structural reforms relates to the existing fiscal responsibility legislation to impose debt limits on ourselves."

“And we are also putting in place a fiscal council that will ensure compliance with the fiscal rules. The fiscal council is supposed to be an independent council which will, outside the government, monitor our progress in terms of debt management, in terms of how much we borrow, how we repay, to ensure that we do not go beyond the limit that we are imposing on ourselves.”