The Minority National Democratic Congress (NDC) has fingered the government for what it says are line fiscal maneuvering to give a wrong impression of the economy contrary to the real situation.
According to the Minority, the 2021 Budget is a dishonest compilation, indicating the current Fiscal Framework as reported in the Budget Statement was a deliberate attempt by the government to mislead Parliament, the investor community, civil society organisations, and the general public.
Wrong and misleading impressions, the Minority said, have been created that Ghana is undergoing fiscal consolidation and as a result, there has not been enough pressure on the Government to be fiscally prudent.
Addressing the media in Parliament on Thursday in respect of the Minority’s position on the 2021 Budget, Minority leader Haruna Iddrisu, pointed at a deliberate attempt by government to blame COVID-19 for the abysmal performance of the economy in the 2020 fiscal year.
He argued that mismanagement, uncontrolled expenditure and sheer lack of prudence accounted for the poor performance of the economy and not just COVID-19.
The 2021 Budget has proposed new taxes and levies and these include a COVID-19 Health Levy, 1% increase in NHIS levy, 1% increase in VAT flat rate, Betting and gaming levy, Energy Sector Levy of 20 pesewas per litre on fuel, Review of road tolls, Sanitation and pollution levy and the Financial sector cleanup levy.
These, the Minority leader insisted, are problematic and unjustified.
According to him, the economy needs a recovery post COVID to improve its performance, improve livelihoods, and new opportunities for jobs to address unemployment.
He stated that government should rather increase stimulus for businesses for instance hospitality an pharmaceuticals etc and argued the imposition of the eight new taxes and levies are unjustifiable.
“The insensitive Akufo-Addo Government clearly is oblivious of the plight of the ordinary Ghanaian and is concerned with a narrow interest of Government.”
“It is absurd and hypocritical for a government that prosecuted its election campaign on the pledge of moving from taxation to production, make such a dramatic “U” turn and introduce so many draconian taxes in such a short space of time,” he said.
Speaking on the public debt, Mr. Haruna Iddrisu observed that President Akufo-Addo inherited a public debt of GH¢122 billion in 2017 but this has ballooned in just four years to GH¢291.6 billion as at the end-December 2020.
Distribution of the accumulated debt by respective governments since 2001 indicates the four years of the first Akufo Addo’s Government has accumulated 60%; followed by the 4 years of John Mahama’s Government, 29%; the four years of Atta Mills/Mahama’s Government, 9%; and eight years of Kufuor’s Government, 2%.
According to the Minority, the first Akufo-Addo Government had the largest accumulation of Public Debt but the least capital expenditure as a percent of GDP.
The minority leader warned that the sustainability of Ghana’s Public Debt calls for drastic measures that would involve additional borrowing to finance the budget and thus worsen Ghana’s Debt Situation.
He noted that for the 2019 fiscal year Government reported a fiscal deficit of 4.8% of GDP and 7.5% for 2020 meaning an amount of about GH¢8.2billion has been concealed from the expenditure framework.
The Minority demanded the fiscal deficit including arrears for the year 2020 be corrected in the budget statement to reflect the actual figure of 17.5% of GDP.
The side also demanded the government to include the Energy sector payments of GH¢6.2 billion in the fiscal tables to reflect in the corresponding fiscal deficit, which has been excluded in the budget.