An Economist, Dr. Godfred Bokpin has described as over ambitious, fiscal targets set by the government in its 2016 budget statement and economic policy.
His basis is due to what he refers to as a limited time frame and a challenging economic situation to facilitate the implementation of the budget statement.
Finance Minister Seth Tekper, on the floor of parliament on Friday affirmed government’s resolve to reduce the country’s budget deficit to about 5 percent of Gross Domestic Product (GDP) in 2016.
Also, the Statistical Service has revised Ghana’s GDP growth from 3.5 to 4.1%.
But in an interview with Citi Fm, Dr. Bokpin said government needed more time.
“In terms of the extent to which the budget will actually transform the economy, we are a bit limited especially where the economy is, trying to transform it, we need more than twelve or twenty-four months.”
He added, “There have to be a consistent plan based on productivity enhancing reforms, infrastructure investment and private sector leadership. As it stands now, we don’t have the financial resources to be able to do all of these.”
The Finance Minister also outlined some public sector management reforms in a bid to enhance the efficiency, transparency and accountability of the Public Financial Management (PFM) Systems.
These included; Cabinet’s approval of a comprehensive PFM Strategy with accompanying action plan and results framework; a new overarching PFM Bill which is currently being drafted and expected to be passed into law in 2016, to provide a stronger regime for budget planning and formulation, execution and monitoring.
The law is also intended to provide a comprehensive approach to macro-fiscal management, budgeting, and treasury and debt management, accounting and reporting of the use of all public resources.
Although Dr. Bokpin agreed with the reforms being rolled out by the government, he however advocated an effective policy framework.
“One good thing that the minister talked about is the public sector management reforms that are ongoing but these things are more effective when they are bundled together or when they are reinforcing.” Dr. Bokpin stated.
In a related development, a Member of Parliament’s committee on finance, Dr. Osei Assibey has cast doubt over government’s ability to spend within its target, “John Mahama’s record of 2012 where he overspent by about 4.8 billion Ghana cedis and going to 2016 with him as the president, I am scared he is going to overspend,” he said.
The Chairman of the Parliamentary select Committee on Finance, James Klutse Avedzi however says government is likely to overspend if labour demands exceed government’s budget.
“It is a kind of a signal that it is sending to all Ghanaians including labour that whatever you are demanding should be guided by the fact that the government does not want to overspend so if that is followed, then the President will not overspend. But if labour pushes, and it is supported by the general population, then government’s aim will not be achieved,” he said.
Source: citifmonline