Ministry of Finance warns contractors

Mr. Seth Terkpe - Minister of Finance
Mr. Seth Terkpe – Minister of Finance

As Ghana struggles to cut its 2013 fiscal deficit, the Ministry of Finance has warned contractors it will not go ahead with any project that has not been provided for in the 2013 budget.

The Chief Economic Officer of the Ministry, Mr. Oku Afari advised contractors to ensure that they have signed the ‘Certificate of Commencement’ duly signed by the Director of Budget at the Ministry before they can get approval for any project.

Ghana widened its budget deficit in 2013 to 12.1 percent from an initial target of 4.8 percent at the start of 2012 and a revised target of 6.7 percent in July.

The deficit was the result of a sharp wage bill increase, higher interest costs and payment of arrears.

The government has drawn criticism from investors and the country’s credit outlook has been downgraded as a result. The government is targeting a 9 percent cut in 2013.

At a workshop with journalists in Accra Friday March 8, 2013, officials of the Ministry of Finance and Economic Planning indicated that the government is committed to achieving the 9 percent target.

According to the Chief Director of the Ministry, Major (Rtd) Mahama Samuel Tara, the Ministries can not also initiate projects without directives from the Presidency.

The Minister of Finance, Mr. Seth Terkper said Cabinet has instructed the slowing down of contracts.

“Now that we know the liabilities, we are focusing on clearing the pipeline,” he said.

Adding, “The phenomenon where we were adding onto the liabilities that we had because we didn’t have a clearer picture is something that is being corrected and this is an important measure to control expenditures.”

According to the officials there was a shortfall in the funds received from Development Partners, they said government received $389.4 million which is 0.4 percent of GDP. They also indicated that government spent GH¢339 million on utilities and petroleum subsidies.

The officials told journalists that despite the increase in the price of gold, the country did not benefit because of the stability agreements that it has with mining companies.

Expected revenue from oil was also not achieved because of what they described as problems with production at the Jubilee oil fields, the officials said.

By Emmanuel K. Dogbevi

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