Govt to enact law against fiscal indiscipline – Senior Minister

Mr Osafo Maafo (left), answering questions at the forum, Photo, Seth Adu Agyei (1)

Mr Osafo Maafo (left), answering questions at the forum, Photo, Seth Adu Agyei (1)

A new law that seeks to limit government’s annual deficit spending to 5 per cent of Gross Domestic Product (GDP), is in the offing, the Senior Minister, Mr. Yaw Osafo-Maafo has announced.

According to him the enactment of the law had become necessary due to the inability of governments to ensure fiscal discipline.

“Ghana has experienced inconsistent growth in its development over the years. We make progress at certain times but fail to consolidate the gain. As a result of these fiscal slippages and inconsistencies in growth, government is working on establishing the Fiscal Responsibility Council (FRC) to implement the Fiscal Responsibility Act to be enacted,” he explained.

Mr. Osafo-Maafo disclosed this at the opening of the seventh edition of the Ghana Economic Forum (GEF) which opened in Accra yesterday.

This year’s event is on the theme: ‘Building a competitive economy for sustainable growth.’

It attracted professionals from diverse backgrounds including: economic policy makers, implementation agencies, members of trade and industry associations, diplomatic missions, donor agencies and non-governmental organisations.

The Senior Minister attributed the current challenges being witnessed at the financial front in the country to the indiscipline that characterised the management of the economy.

“The inability of the private sector to succeed is as a result of the constant fiscal slippages and inconsistencies in growth which the World Bank and International Monetary Fund  (IMF) have described as the ‘Reversibility Curse’, as a result, government was not just working to ensure macroeconomic stability but also consolidate the gains,” he added.

Mr. Osafo-Maafo said the private sector or industry can only succeed when the macroeconomic environment was stable for a longer period, stressing that, “For the private sector or industry to succeed, there is the need to ensure stability through which businesses can plan well.”

Touching on the government’s agenda for economic transformation, he said four key thematic areas made up of macroeconomic stability and debt sustainability, infrastructure development, accelerated industrial development and agricultural transformation.

He said all four thematic areas were geared at achieving the ‘Ghana beyond Aid’ agenda of the president, adding that on the economic front the government was on course.

However, the broader agenda would require an efficient public sector; as a result the government was working to transform the public sector to make it more efficient, more effective and responsive to the needs of the citizens and the private sector.

On her part, the Chief Executive Officer (CEO) of the B&FT, Dr. Mrs. Edith Dankwa said the main objective of the forum was to lead discussions that would formulate policies for inclusive and sustainable development.

She said in resolving the growing unemployment challenge facing the country, the government and the private sector must both pursue a common agenda to create the needed jobs.

Dr. Dankwa said, “We need to engage in a determined effort to rebuild the foundation of the economy.”

By Cliff Ekuful & Allia Noshie

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