Extra GH?1.89 billion not solution; 'Sick economy' needs reform – Kwaku Kwarteng

A member of the Finance Committee of Parliament, Kwaku Kwarteng, wants government to heed to calls for a cutback on public spending, warning economy is headed for trouble.

Mr Kwarteng says he is baffled by the current administration’s reluctance to reduce waste in the public sector even as it has become evident it is an impediment to improving growth figures.

He cites the continuous government allocation to state institutions such as the Driver and Vehicle Licensing Authority (DVLA), the Environmental Protection Agency (EPA) the Energy Commission among others as an example of some of the factors contributing the ballooning public expenditure.

The New Patriotic Party (NPP) Member of Parliament (MP) for Bekwai has also chastised the John Mahama-led administration for creating additional constituencies and districts, noting the politically motivated decision have also taken toll on national coffers.

“Now things are catching up with us and we are beginning to see the absence of money for central government to do the things that it ought to do for the environment to be free and for the private sector to operate,” Mr Kwarteng said.

He was speaking Tuesday on current affairs programme PM Express on the Joy News channel on Multi TV, which discussed the Finance Minister’s request Monday for an additional GhÈ»1.89 billion supplementary budget.

Seth Terkper asked Parliament to approve the Ghc1.89 billion to help run programmes and policies for the rest of the year, explaining the request has been necessitated by the major shortfalls in revenue generation and the need for extra cash to invest in key sectors of the economy.

However speaking on PM Express Tuesday, Kwaku Kwarteng said the Finance Minister’s request is an outcome of poor and lazy economic decision making.

“Our fiscals are not right, we are overspending our means,” he told show host, Nana Ansah Kwao IV.

“The writings are very clear on the wall that our economy is increasingly getting sick and sick and until we are bold, not only to cut the corruption but also to do the reforms in the public sector that would make government expenditure manageable, we are never going to get out this,” he emphasised.

He admonished government to follow through with its decision in 2013 to cut the DVLA, EPA and Energy Commission staff from public pay roll because these institutions have demonstrated that they can function effectively without relying on central government allocation.

A Lecturer of Finance and Investment at the University of Ghana Business School, Lord Mensah, who was also on the show backed the Finance Minister's request for a supplementary GHȻ1.89 billion, noting it is not uncommon for a Finance Minister to demand more cash to prop up expenditure.

Lord Mensah
According to him, although there has been a shortfall in revenue from Ghana’s key exports, necessitating the supplementary budget, value addition to export commodities would improve the situation.

Citing cocoa exports as an example he said the technology for production of the country's key export commodity has not seen any improvement for many decades.

“With all the monies that come to COCOBOD, what are the investment that they’ve been doing?,” he asked.

Story by Ghana | Myjoyonline.com | George Nyavor | [email protected]