September 27, 2020

Gov’t requests GHS11.8bn supplementary budget amid COVID-19 threats

The Minister of Finance, Ken Ofori-Atta, has tabled a request from government to Parliament for a supplementary budge of 11. 8 billion Ghana cedis to support government’s expenditure for the rest of the year.

The request is to assist government implement various initiatives to strengthen various sectors of the economy due to the revenue shortfalls and budget deficit created by the impact of the Coronavirus pandemic.

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“Mr. Speaker, this Mid-Year Fiscal Policy Review and its programmes draws us closer to our collective aspirations. Whiles this pandemic requires us to exceed the limits imposed by the FRA, Act, 982, we have had to make these major expenditures to protect lives and livelihoods of Ghanaians and sustain businesses. We therefore request a supplementary Budget of GH¢11,896,477,566.00 to enable us continue this extraordinary task” he requested.

Among other things, the Minister announced new measures such as reduction in the Communication Service tax from 9 to 6 percent and the extension of free water supply to Ghanaians for the next three months and free electricity supply to lifeline consumers for the rest of the year.

The support also includes an unprecedented GH¢100 billion Ghana Cares Obaatanpa Programme to transform and modernize Ghana in three and a half years, establishment of a GH¢2 billion Guarantee Facility to support all sectors of business and job retention, establishment of an Unemployment Insurance Scheme,  the creation of a GH¢100 Fund for Labour and Faith-based organisations for retraining and skills development, and an increase the CapBuss Programme by GH¢150 million to, among other things facilitate credit of GH¢50 million to support the Creative Arts, the Media and the Conference of Independent Universities.

The Finance Minister also announced a review in GDP projection from 6.8 percent to 0.9 percent.

According to the Finance Minister, the double shock of the pandemic and a global economic recession, have resulted in a revenue shortfall of GH¢13.6 billion and unanticipated but necessary expenditures of approximately GH¢11.7 billion.

It is the hope of the Minister that the Coronavirus Alleviation & Revitalization of Enterprises Support (CARES) programme, will allow government to recreate the economy and set it on a desirable course.

He says this will involve an investment of GHH¢100 billion from 2021 to 2023, of which GH¢70 billion will come from the private sector.

“I consider the CARES programme truly ground-breaking as it requires radical reforms in government, particularly in revenue generation and a radical improvement in doing business for the private sector. It also adopts a whole-of-government implementation approach and fosters closer collaboration with the private sector to give a sustainable future to Ghanaians, as captured earlier.”

Source: Business