Parliament has approved the 2023 Budget Statement and Economic Policy, despite opposition from the Minority on the revenue mobilization measures. This is in spite of threats by the minority to disapprove the estimates, and debt restructuring until some five conditions were met by the government.
It also comes, despite the threats from the 95 Members of Parliament (MPs) from the New Patriotic Party (NPP) side of the House, not to participate in the debate and approval of the budget until the Finance Minister, Ken Ofori-Atta, is sacked.
Haruna Iddrisu, the Minority Leader, had threatened that they will not accept the debt restructuring programme announced by Mr Ofori-Atta.
As part of the negotiations between the Akufo-Addo government and the International Monetary Fund, (IMF), Ghana is embarking on a debt exchange programme to ensure that debt levels are brought to sustainable levels.
But during the final day of budget debate, the Minority group, raised concerns about some of the revenue generation measures, including the removal of a threshold on the Electronic Transaction Levy and a 2.5percent increase in VAT.
The Minority asked the government to embark on heavy expenditure cuts, in order to deal with the challenges facing the economy.
Haruna Iddrisu, said some of the tax handles of the government would suffer if the administration does not cut spending
“It is the demand of this group that there must be major expenditure cuts otherwise some of your tax handles will suffer in our hands. For instance, GHS1.4 billion allocation to contingency vote, we shouldn’t give him that,” he said.
The Majority Leader, Osei Kyei-Mensah-Bonsu for his part said “Some roads have begun, intention is to ensure that they don’t deteriorate, they are not left unattended to.”
The approval paves the way for estimates for ministries, departments, and agencies, (MDAs) to be referred to the various committees for scrutiny.
Earlier, Haruna Iddrisu, had reiterated his call for the government to drop its decision to increase the VAT rate by 2.5 percent and scrap the E-levy threshold, warning such a move will not get the support of the minority caucus.
“Mr Speaker without going further we in the NDC minority group will fiercely resist and fight the imposition of this additional tax on Ghanaians and Ghanaian businesses because Mr Speaker it will only exacerbate and increase the hardship they’re already going through, will increase the cost of doing business for many Ghanaians, and it will make it difficult for ordinary Ghanaians to cope,” Mr Iddrisu said.
But the majority leader, Osei Kyei-Mensah-Bonsu, said the 2.5percent increase in VAT will go into the construction of roads.
“About 25% of questions that are asked in this Chamber relate to Roads. Some roads have begun and the intention is to ensure that they don’t deteriorate, they’re not left unattended to, so the 2.5% increase in VAT we have been told primarily is going to be used for road construction. If you don’t want your roads to be constructed, tell us that you don’t want your roads to be constructed,” he said.
At a press conference on Monday, the minority leader said, “Let me state, without any fear of contradiction, that the form and structure of the debt restructuring plan announced by Ken Ofori-Atta are unacceptable to us, and we simply will not accept it.”
He also raised concerns over why the government failed to announce the exchange programme in the budget statement presented to parliament.
According to Haruna Iddrisu, the minority are aware that “the Akufo-Addo/Bawumia government have become desperate and is compelled after reckless mismanagement of the economy to achieve fiscal consolidation.”
The conditions tabled by the minority before approving the budget estimates for 2023, included the resignation of the entire Economic Management Team and in particular Alhaji Bawumia from his position as Chair of that obviously moribund body.
The immediate resignation or dismissal of the Finance Minister Ken Ofori-Atta, and immediate reduction in the number of Ministers and political appointees at the Office of the President by half.
The removal of all non-essential expenditures in the 2023 budget including the GHC 80 million allocated to the National Cathedral and the reinstatement of the GHC100 exemption threshold for e-levy payment.
The minority had reiterated that the country’s ailing economy was characterized by unsustainable debt, inflation, and unprecedented credit rating downgrades, among others.
Mr Iddrisu, explained the economic situation is so bad that Ghana is currently ranked side by side with Sri Lanka, which is considered the worst economy in the world and has defaulted on its debt.
Speaking at the press conference, he said “as it’s now trite knowledge, the Ghanaian economy has been terribly mismanaged in the last five to six years by the Akufo-Addo/Bawumia administration leading to our request for a 17th IMF program to renew confidence and policy credibility on our failing economy despite haughty initial denials.
“The severely ailing economy has been characterized by unsustainable debt, very high inflation, unprecedented and disastrous depreciation of the cedi, high budget deficits and unprecedented credit rating downgrades.
“The economic situation is so bad that we are currently ranked side by side with Sri Lanka, which is considered the worst economy in the world and has defaulted on its debt.”
