PAC Questions Decrease In National Cash Reserves

Kwaku-Agyeman-ManuOfficials from the Bank of Ghana (BoG) and the Ministry of Finance yesterday appeared before the Public Accounts Committee (PAC) of Parliament to explain the whereabouts of US$596.8 million from the country’s reserves.

Although the central bank’s net receipts went up by 9.7 per cent from 2011 to 2012, the amount of money in the country’s reserves rather reduced from US$5.83 billion to US$5.28 billion, leaving an amount of US$596.8 million unaccounted for.

The BoG officials were to explain the shortfall when the committee was considering the report of the Auditor General on the statement of foreign exchange receipts and payments of the BoG for the half-year ended December 31, 2012.

The Head of Treasury at BoG, Yaw Abalo, and the Head of Internal Audit at the Ministry of Finance, Annor Kissi, who represented the Governor of BoG and the Ministry of Finance respectively, could not explain how the central bank expended the amount.

The committee, chaired by the Member of Parliament for Dormaa West, Kwaku Agyeman Manu, demanded specific details on how the shortfall occurred. According to Mr. Abalo, who often hesitated before answering questions from the committee members, the amount was used to pay government’s debts and other transactions.

Dissatisfied with their explanations, the committee discharged the two officials and requested the Governor of BoG and the Minister of Finance to appear before the committee to give better explanations.

They urged the Minister and the Governor to be abreast with the details in order to give a better explanation on what led to the reduction in the country’s reserves by such a margin when foreign exchange receipts had gone up significantly.

The two officials were also quizzed on why the BoG paid some local contractors in foreign currencies when it had ordered the public not to transact in foreign currencies.

According to the officials, the contractors who were paid in foreign currencies were foreign contractors who had subsidiaries in the country.

Also, he said some of the ministries negotiated contracts in foreign currencies, leaving the bank with no option than to make payments in foreign currencies.

Mr. Agyeman Manu urged the Finance Minister and the Governor of BoG to tell the committee why contracts amounting to about US$90 million were given to a company known as Amandi Holding Limited and how the payments were made, as well as whether they had honoured all their tax obligations when they appeared before the committee. By Yaw Kyei

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