Parliament has approved GH¢6.37 billion to provide additional financing for Government operations during the 2019 financial year after the Supplementary Appropriation Bill, 2020 passed the third reading in Parliament Friday night.
The passage of the bill deems the utilization amount authorized, which will be issued from the Consolidated Fund and for withdrawal from other funds for the purposes of the Government's expenditure, to have come into effect on July 29, 2019.
Government said GH¢5,144,602,689.01 out of the total appropriation of GH¢6,370,355,925.82 was used to make payments to Independent Power Producers (IPPs) and related parties.
According to a report of Parliament's Finance Committee, the rest of the funds were applied towards interest payments as well as an upward adjustment in goods and services expenditure for the 2019 financial year.
After the approval of the 2019 budget by Parliament, there arose significant domestic and global developments, which posted fiscal risks to the Ghanaian economy.
The government said the developments were mainly related to the upward adjustments of interest resulting from the effect of a higher exchange rate than the programmed exchange rate and a higher net domestic borrowing in the first half of the year.
It also stated that part of it was due to an upward adjustment in goods and services in the second half of the year to meet critical security expenses and other expenses.
Additionally, the crystallization of contingent liabilities of the energy sector in respect of take-or-pay contract obligations with the IPPs increased the requirements for external amortization above the amount provided for in the 2019 budget.
“These developments led to supplementary estimates being approved to support government operations for the year,” the Finance Committee explained in its report to the House.