Vice Presidential Candidate of the New Patriotic Party (NPP) Dr Mahamudu Bawumia has raised fears government may deliberately miss the 2016 target set for it by the International Monetary Fund (IMF).
According to the economist, the country’s fiscal consolidation from the three-year programme is “exactly the opposite of what Fiscal Consolidation is supposed to achieve”.
In a written piece on Monday, July 25, Dr Bawumia said the overspending that characterized government expenditure in 2012 will have a ripple effect in 2016.
“We should recall that the economy ended in 2012 with a fiscal deficit of 12 percent of GDP, 11.7 percent of GDP in 2013 and 11.9 percent of GDP in 2014.
“This was the first time in Ghana’s history that double digit fiscal deficits were recorded for three consecutive years and demonstrated the deep fiscal hole that Ghana’s public finances had plunged into following the reckless increases in public expenditure during the 2012 election year and subsequent years.”
The former Deputy Central Bank governor claimed the recent assurance by government that the IMF extended credit facility is paying dividends is to hoodwink Ghanaians.
He cited the inability of the IMF board to approve the third review as evidence government had supplied the Fund with wrong figures given the reason the review team gave.
“Amongst the reasons for the non-conclusion of the third review is the IMF statement in response to media questions that the fiscal data for 2015, which provided the basis for the positive assessments of the first and second reviews, is yet to be ‘reconciled’.
“This is code phrase or euphemism for the fact that ‘data is likely wrong’. How can 2015 fiscal data not be reconciled by July 2016? What is so complicated about it? What this points to is that the government is not coming clean on the fiscal data.”
Dr Bawumia concludes that government may be deliberately scheming to end the programme in order to have the leeway to spend beyond the approved budget.
“Then again, this John Mahama-led NDC government may just be setting the stage to deliberately or technically abrogate or suspend the IMF program to give it the space to go on another spending binge for the 2016 election as they did in the 2012 election year.”
Dr Bawumia therefore asked for a fully reconciled data for 2015 and the first half of 2016.
“The lack of transparency is undermining confidence in the economy. This NDC government is simply not being honest with itself, the good people of Ghana, the IMF and the international community about the state of Ghana’s public finances. We need a real accounting for the money.”
‘IMF deal on course’
Meanwhile, Minister of Finance Seth Terkper has insisted that the programme is on course.
Addressing Parliament on Monday in his delivery of a mid-year review of the 2016 budget statement, Mr Terkper said the third review mission was held in May.
He said the IMF team will meet Parliament soon.
He dispelled reports that the programme is in limbo due to it not having passed through the legislature, announcing that it will be presented to the House soon.