Govt’s overrun for first half of year hits GHâ‚µ4.8 billion
Government has ended the first half of this year spending GHâ‚µ4.8 billion more than revenue generated.
This was against a targeted expenditure of GHâ‚µ4.7 billion.
According to the provisional fiscal data released by the Finance Ministry, government was able to raise GHâ‚µ 11.14 billion as against a target of GHâ‚µ12.1 billion, but spent GHâ‚µ 13.5 billion – representing an overrun of GHâ‚µ2.36 billion.
Also, some GHâ‚µ2.44 billion arrears from last year and the first quarter of this year shot government’s overall balance to GHâ‚µ4.8 billion.
This would result in the budget deficit of 4.2 percent of gross domestic product slightly higher than the government’s 4.1 percent forecast.
Economist Peter Quartey fears that government would end the year with a twin budget deficit unless some though measures are taken to check the overruns.
“We haven’t broadened the tax base enough. There are a lot of informal sector activities that are not taxed and we need to really enhance our efforts are tax collection”, said Mr Quartey.
On expenditure he said if government could cut the wage bill the expenditure overruns could be reduced.
“One of the reasons why I support an IMF bailout is that that is where some of these political economy challenges can be implemented, because left to government alone it is quite a difficult thing to do”, he said.
However Deputy Finance Minister, Mona Quartey, is optimistic some new programmes being instituted by government would address the rising budget deficit.
“In terms of managing the wage bill we’ve talked about how we are looking the electronic platform to ensure that we remove ghost workers. To make sure that we are paying what we really need to be paying”, she said.
She said government will also institute a stricter budgeting process, adding the Ministry will “move from activity based budgeting to a programme-based budgeting process which will help the fiscal deficit as well”.
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