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NDC Job Cut In 2017

By Daily Guide
NDC NDC Job Cut In 2017
APR 24, 2015 LISTEN

President John Mahama
It has emerged that the National Democratic Congress (NDC) government has agreed to cut public sector jobs in its latest dealings with the International Monetary Fund (IMF) which has decided to bail Ghana out of its economic mess with US$918 million.

The Mahama-led government is said to have begged the Breton Wood institution to shift the arrangement to 2017 because of its political implications, especially in an election year, and the fund appears to have agreed.

Senchi Consensus
The government, prior to the deal, had organised a national economic forum in June last year and came out with what was termed 'Senchi Consensus,' which it later used as cover-up in seeking the bailout.

The opposition New Patriotic Party (NPP) boycotted the forum saying it was going to be used as a bait to get them to endorse the harsh conditionalities attached to the IMF loan, including job cuts.

Bawumia's Prediction
Prior to the Senchi forum, Dr Mahamudu Bawumia, who is the NPP vice presidential candidate for the 2016 elections, predicted massive job cuts but the government conveniently claimed it was going to the IMF to solicit its support in implementing what it claimed to be 'home-grown' policies to heal the ailing economy and vehemently denied the bailout bit.

Dr Bawumia, a renowned economist cum banker, had again said recently that the Mahama government was only luring Ghanaians to retain it in office in the December 2016 general elections so that it would embark on the massive job cuts early 2017.

“My understanding is that government wants the IMF agreement to delay the worker layoffs until after the 2016 elections. I wonder why. I suppose the message is 'vote for me before I fire you,'' he said in a           70-page paper he presented at the Central University College, Miotso in March.

'Right-Sizing Exercise'
On page 17 of a document entitled, “Request for a three-year arrangement under the extended credit facility,” posted on the IMF website on April 21, the government had pledged to bring reform to the Civil Service by forming a taskforce to make recommendations to the government as part of the 'right-sizing exercise.'

'The government aims at bringing the wage bill-to-revenue ratio down from 53 percent in 2014 to 35 percent over the medium term, in line with the regional ECOWAS target,' the document said, adding, 'This will require wage restraint over the full            three-year programme period, with increases consistent with expected disinflation.

'The authorities will design a civil service reform strategy during 2015 with the assistance of development partners, which will aim at increasing the productivity and rationalising the size of the civil service. As part of this reform, the government intends also to review the role of subvented agencies.'

Also, the document gives details of Ghana’s programme with the IMF, including the conditions that the country is expected to meet before further disbursements are made.

It said that Ghana should get its next disbursement of 144 million dollars by July 15, another one in November, if government meets certain conditions. Even though the programme will end in 2017, the last tranche will be advanced to Ghana in March 2018.

Bailout Background
The Executive Board of the IMF in early April approved a three-year arrangement under the Extended Credit Facility (ECF) for Ghana in an amount equivalent to SDR 664.20 million (180 percent of quota or about US$918 million) in support of Ghana's medium-term economic reform programme.

According to the IMF, the programme aims to 'restore debt sustainability and macroeconomic stability to foster a return to high growth and job creation, while protecting social spending. The Executive Board's decision will enable an immediate disbursement of SDR 83.025 million (about US$114.8 million).'

The programme foresees a pick-up in economic growth, starting in 2016, supported by expected increases in hydrocarbon production, lower inflation and interest rates and combined with a stable exchange rate environment.

By William Yaw Owusu

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