Ahead of the presentation of the 2020 Budget and Economic Policy of government to Parliament tomorrow, the Minority Caucus has tabled some issues they want addressed.
At a media briefing yesterday, the Minority asked the government to ensure that a number of fiscal misreporting by the Finance Ministry in recent times were rectified in the Budget Statement, else the Minority would “use all constitutional provisions available to resist the act.”
Delivering a speech on behalf of the Minority, Cassiel Ato Forson, Member of Parliament for Ajumako-Enyan-Essiam Constituency, said for almost three years, the government had churned out macroeconomic indicators that have little or no bearing on the hardships confronting Ghanaians.
Citing a few examples on the misreporting, he said the GETFund used its receivables as collateral to borrow about US$1.5 billion from consortium of banks, saying, “Surprisingly, this financial transaction was treated as an off-balance sheet operation, hence did not go through the fiscal”.
He said technically and as current practice, the GETFund was purely a government operation, making it inappropriate to treat such a transaction as an off-balance sheet transaction, saying, “Operationally, the recognition of government commitment to be paid-for through borrowing should not reduce the size of the overall deficit”.
Mr Forson said such a practice inevitably led to borrowing and added to public debt, adding that the public debt stock, which stood at GH₵120.3 billion at the end of December 2016, had risen to GH₵205.5 billion as at the end of July, 2019, stating that, “the increase of public debt of GH₵85.2 billion within a period of just 3 months is very alarming and worrying.”
Mr Forson who is also a ranking member of Finance Committee of Parliament, said the Minority would want the government to implement its 2016 Manifesto in which the New Patriotic Party (NPP) promised to reduce Corporate Income Tax from 25 per cent to 20 per cent in the budget.
He said the Minority also expected the government to remove both component of one per cent and two per cent of the Special Import Levy, pointing out that, “They removed the smaller component of one per cent in 2017, but extended the larger component of two per cent to December 2019.”
Mr Forson then urged the government to keep its promise of removing the two per cent Special Import Levy in the budget they would be presenting tomorrow.
“Furthermore, the government in 2017, decided to extend the National Fiscal Stabilisation Levy (NFSL) of 5 per cent to December 2019. To lessen the plight of Ghanaian businesses, we will entreat the government to honour its promise of shifting from taxation to production by not seeking the renewal of the NFSL,” he said.
The Minority also appealed to the government to use the budget to address the plight and suffering of the average Ghanaian who could not keep up with the increase in taxes, and not come to the floor with the usual slogan: “We inherited a mess in 2017”, saying, “at least come and talk about the heavy investment in the oil and gas infrastructure and the fiscal buffers you inherited”.
Mr Forson said some of the government policies had caused countless job losses, shut-down of many businesses, deteriorated livelihoods, and poor tax revenue performance due to a weakened real sector saying, “I am not sure you have made time to count the number of businesses that have closed down along the Spintex road, within the Industrial areas, and the Accra and Tema Central Business Districts”
He said the approach adopted in the so-called banking and financial sector clean-up was the most reckless and inhuman option, adding that contrary to initial assurances that depositors fund would be protected and jobs would be saved, none of the assurances had been kept.
Mr Forson said the mess had further aggravated the unbearable hardships Ghanaians were facing with an overall negative effect on the larger economy yet to be thoroughly quantified, adding, “We expect the Finance Minister to put out concrete measures to address non payments of deposits and the salvaging of jobs.”
He said: “Times are really hard and you must act, Mr President. The hardship is real and not cosmetic like your macroeconomic indices that cannot translate into improved livelihoods.”
The Minority queried whether the budget would help resolve issues like, the growing unemployment, settle the long outstanding payments of government contractors and suppliers, ensure that statutory arrears on District Assemblies Common Fund, National Insurance Levy (NHIL) and the GETFund were duly paid.
He said it was becoming unprecedented for government to increase expenditure without corresponding sustainable revenue measures such that it had resorted to disingenuous, unconventional and unacceptable ways of hiding these expenditures “below-the-line”.
Mr Forson said total capital expenditure from January 2017 to June 2018 was GH₵13.6 billion compared to the increase in the total debt of GH₵85.2 billion, implying that, most of the public debt was spent on consumption rather than investment.
BY LAWRENCE MARKWEI