Business and Economics

Minority criticizes supplementary budget

Accra, July 27, GNA – Some members of Parliament on the Minority side have criticised government’s mid-year review budget statement, saying the financial plan did not have concrete measures to address the resurgent energy shortfalls.

Accra, July 27, GNA – Some members of Parliament on the Minority side have criticised government’s mid-year review budget statement, saying the financial plan did not have concrete measures to address the resurgent energy shortfalls.
They said they had expected the supplementary budget to give clear indications on how government will address the energy deficit, but the Minister of Finance, Seth Terkper was silent to the dismay of the Ghanaian.
Government on Monday asked Parliament to approve GHC1.8 billion to address shortfalls in the 2016 budget and to cater for its programmes for the rest of the 2106 financial year, necessitated by both domestic and global developments.
Mr Terkper told the House that despite government’s fiscal prudence in the macro-economics of the country, a number of challenges in the domestic and global economic environment had affected the assumptions underlying the 2016 Budget since its presentation last November.
To buttress his point, the Minister who also oversees the Power Ministry, cited the decline in crude oil prices in January 2016 to a low of US$28 per barrel, compared to the US$53.05 per barrel used in benchmarking the Budget, with the price still hovering between US$45 and US$48 per barrel as at the end of June 2016, still below the projections made in the budget.
He said defects in the turret bearing of the FPSO Kwame Nkrumah adversely affected crude oil and gas production for the first half of 2016, and despite the repairs made to the broken West Africa Gas Pipeline, increased rebel and pirate activities continue to adversely affect the supply of gas to Ghana, further impacting negatively on power supply and, consequently, full recovery of the economy.
The Minister also identified ‘sluggish commodity prices’, as having implications for executing the 2016 Budget, compelling Government, for the second year running, to request Parliament to revise the allocations made to the Annual Budget Funding Amount (ABFA).
Governments originally requested for GHC 50 billion for the 2016 fiscal year.
The Minority said that the supplementary budget did not also address the growing problem of unemployment, which has worsened because of the energy crisis with consequent folding of industries and factories.
Dr Stephen Nana Ato Arthur, the MP for Komenda-Edina-Eguafo-Abirem, told the Ghana News Agency that the Statement was more of a State of the Nation Address than supplementary estimates, arguing that it had nothing to do with supplementary figures.
He said the statement did not address to the House’s satisfaction the reasons for the erratic power supply and unemployment.
The lawmaker said in the original budget, the government promised to add 1,300 megawatts of power, and the Minister should have told the House how far the government had gone in installing that capacity.
“Government has not mentioned anything about the energy situation in the statement….they should have said something to comfort Ghanaians who are suffering as a result of the erratic power supply.
“This supplementary budget is ‘much ado about nothing’. There is nothing to give Ghanaians hope that the predicament we find ourselves is being addressed,” he said.
Mr Joe Appiah, the MP for Ablekuma North, also reiterated his other colleague’s sentiments saying the Minister gave a lacklustre presentation that did not proffer solutions to the country’s crippling power crisis.
He said Mr Terkper “read the budget because he just needs to spend money”, adding that the Minister did not talk about fiscal policy except to mention putting less pressure on interest rate and curbing budget overruns, when clearly Ghana’s biggest economic issues was about the energy and employment.
“It looks as if he just read the budget because he just needs to spend money. There wasn’t any impressive thing that will propel us to the future or to stop the energy crisis in this country. He couldn’t say anything about VRA’s debt of $180 million to Nigeria, so what is he talking about? We are still in the energy crisis and he didn’t say anything about it only to be mentioning excessive borrowing; to redeem what?” he queried.
To Dominic Nitiwul, Deputy Minority Leader, the Minister deviated from the main issues and presented what he called “the campaign mini budget”, explaining that the focus of the statement was rather on campaign projects government was undertaking.
“We thought that government will be looking at the pressing issues, the energy issues. We want to know what government will have to do to assure the people of Ghana that between now and the end of the year the problem will be resolved,” he said.
The Minister is to present an appropriation bill later to Parliament.

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