Business News of Friday, 30 October 2020
Parliament has moved swiftly to approve a request by the Finance Minister, Ken Ofori-Atta, to spend GH¢27.4 billion in the first quarter of 2021.
The Minister made the request to spend the amount from January to March next year when he presented the 2021 budget to Parliament on Wednesday, October 28, 2020.
According to Citi News, during a debate on the budget, Minority Leader, Haruna Iddrisu, questioned the accuracy of the figures presented to Parliament by the Minister for Finance.
“What is worrying is that if we don’t get the statistics right on debt and GDP, we will not get the other figures right; even inflation, we will not get it right,” he is quoted in the Citi News report.
Meanwhile, this is how the Minister intends to spend the funds:
1. Compensation of Employees - GH¢7,708,960,148
2 Goods and Services - GH¢1,595,571,683
3 Interest Payments - GH¢7,002,221,941
4 Subsidies - GH¢259,087,194
5 Grants to Other Government Units - GH¢4,340,216,517
6 Social Benefits - GH¢41,271,000
7 Other Expenditure - GH¢813,610,025
8 Capital Expenditure - GH¢1,903,658,408
- Total GH¢23,664,596,915
9 Arrears Clearance - GH¢350,000,000
10 Amortisation - GH¢3,419,583,605
- Appropriation - GH¢27,434,180,520
“For the purposes of the 2021 Expenditure in Advance of Appropriation, we have projected the 2021 first-quarter total revenue and grants at GH¢13.3 billion while total expenditure including the clearance of arrears is projected at GH¢24.0 billion. This results in the projected fiscal deficit of GH¢10.7 billion for the period,” he said.
He revealed further that to support the 2021 budget and liability management, his Ministry plans to source funding from the international capital market.
According to the Minister, the sourcing of funds from the international market will include the issuance of sovereign bonds of $3 billion, with the option to increase it to $5 billion, if market conditions are favourable.
He said out of this amount, $1.5 billion will be used to support the 2021 budget and $3.5 billion for liability management.
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