GGovernment of Ghana seeks to pass a law that will limit annual fiscal deficit to Gross Domestic Product (GDP) ratio to five percent, Senior Minister Yaw Osafo Maafo disclosed here on Monday.
Opening the Ghana Economic Forum, the Senior Minister, who is the most senior state official in charge of the economy besides the Vice-President, said a Fiscal Responsibility Law could punish state officials who outspent limits granted them.
“That’s why we are looking at the fiscal responsibility law, so you can’t come and run the deficit anyhow. There should be a law restricting you within a band. We are looking at 3.4 percent and five percent deficit annual so that Minister for Finance will be responsible. And people should suffer for breaking such economic rules,” the minister said.
The minister wondered why in spite of the Bank of Ghana Act which says that the government should not spend more than 10 percent in excess of the previous year’s revenue, government spends 42 percent above the previous year’s revenue and nothing happens, and the governor continues to hold his job.
“Because we can’t have the law which restricts you to control expenditure, you do it anyhow, put the whole country into a mess and enjoy your position as a governor. It’s high time we looked at some of these things and make sure that people who break our own agreed laws suffer for it. We are in difficulty but we can easily overcome,” he said.
Osafo Maafo underscored the need for the country’s economy to be redeemed from the cyclical boom and bust.
“Let us resolve to get the economy resolved once and for all. Let us remove this tag of irreversibility on our head that Ghana will do well for some time and later we reverse to the bottom, then we climb again to the top; that cannot do. Once we set on motion and moving we should make it impossible for any government to reverse that motion,” Osafo Maafo urged.
The two-day forum is organized by the Business and Financial Times Limited, under the theme “A Ghanaian-Owned Economy: 60 Years After Independence.”
Chief Executive Officer of the Business and Financial Times, Edith Dankwa, stressed the need for Ghanaians to own their economy.
“Our economy is our responsibility. Who will do it for us? As individuals, as organizations, as partners, we all have our interests, which is our nature. If it is our nature, then we have to ensure that we help build our economy,” she added.
While focusing on new developments in corporate financing and the evolving relationship between private sector and authorities, the forum will also debate whether the nature of current development framework allows citizens to own the economy. Enditem