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07.04.2006 General News

High expenditure on public officials blasted

By Public
High expenditure on public officials  blasted
APR 7, 2006 GENERAL NEWS

CASTLE COMES UNDER SIEGE

A report on countrywide public forums on the 2006 budget undertaken by the Center for Budget Advocacy (CBA) of ISODEC has gathered that the public is getting increasingly worried about the luxurious lifestyles of some public officials.

The report which is yet to be made public says the numerous Special Assistants, Advisors and Spokespersons for ministers (notwithstanding their deputies), and the DECs who all use free official vehicles, free fuel and accommodation is a drain on HIPC Ghana.

“The provision of official vehicles, free fuel, etc. to members of Boards of Directors and Commissions, who are not fulltime staff, needs to be curbed. Senior public officers who are provided with official cars and fuel must be made to stop claiming maintenance allowances and drawing official fuel for their private vehicles”, says the report which will be officially released on Monday.

The report says some Members of Parliament stayed in hotels for long periods due to government's inability to provide them with decent accommodation. These acts, CBA notes are a drain on the country's limited resources and can lead to social strife, especially when the people that actually do the work are not given a fair share of the national cake.

The participants also called on all people, especially politicians to live exemplary lives by honouring their tax obligations and also changing their attitudes towards public assets and resources as they have a major part to play in the development process.

Many of the participants were not happy with the use of the country's limited resources, citing the ¢29 billion budgeted for the rehabilitation of the Peduase Lodge for the President as unnecessary for a HIPC country like Ghana as these funds could have been used for much needed social sector programmes. In that vein, CBA calls for the judicious use of borrowed resources so as to benefit the majority of Ghanaians.

According to the report many participants commended the government for the early presentation of the 2006 budget and underscored the importance of the participation of the poor in poverty reduction projects. They also praised government for giving the opportunity to the citizenry to make input into the budget. Most participants called for an institutionalisation of the budget outreach beyond the existing institutions noting that it would lead to increased interest in the budget process.

Other participants, however, noted inconsistencies and inaccuracies in the budget, citing percentages of completion of the Accra-Ofankor road, the Mallam - Yamuransa road and the number of fixed lines installed by Ghana Telecom, the fall of tonnage of cocoa for the year, among others, as inaccurate. They urged government to operate an open and transparent budget system .They expressed dissatisfaction at the lack of accurate and reliable statistical data in the country and urged the Ghana Statistical Service (GSS) to be up and doing. On the macroeconomic front, some participants lauded the government for achieving most of its macroeconomic targets and expressed the belief that the 2006 targets were realistic and achievable but required prudent measures. These participants held the view that macroeconomic stability brings about enhanced employment, reduces capital flight and the risk of doing business and this directly influences citizens' welfare, while instability causes losses and hurts the poor. They, however cautioned against targeting macroeconomic stability at the expense of development and called for balanced targeting. They felt that the growth rate of 6% targeted for the 2006 fiscal year was not robust enough and may not propel the economy to attain a middle-income status, poverty reduction and the achievement of the MDGs.

The 2006 Taxation Policies

Participants noted that taxes were necessary for bringing about the changes that all Ghanaians are craving for. Opinions, however, varied on the various tax relieves that were announced in the 2006 budget. Some participants lauded government for the reduction in corporate taxes, the National Reconstruction Levy (NRL) and the revision of the income tax threshold (¢2.4 million per annum). Others, however, argued that most workers' minimum wages were already above the said ceiling and as such they were not going to benefit from the relief.

Some participants called on the government to pay workers realistic salaries and living wages and stop promising tax relieves that do not impact positively on the poor and wage earners' lives. They blamed the government for failing to announce the minimum wage for 2006 but rather indicated tax relieves based on the minimum wage, which they said, amounted to throwing dust into peoples' eyes.

They expressed concern about the continued taxation of the lowly paid salaried workers using both direct and indirect tax instruments whereas corporate tax was continually being reduced all in the name of private sector development and benefiting companies, especially banks, and the rich. These participants felt that, for the private sector to realize its expected growth, there was the need for government to invest in the public sector, which plays a facilitation role.

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