Business News of Monday, 31 July 2017
The Finance Minister, Ken Ofori Atta is expected to present his midyear budget review and economic planning to Parliament tomorrow, July 31, 2017.
This is in fulfilment of the constitutional mandate requiring the Minister to give an account of the performance of the economy before the commencement of the second half of the year.
Citi Business News understands tomorrow’s presentation will not see a request for an additional budgetary allocation from the House.
This comes despite the almost normal practice where such presentations have been associated with requests for supplementary budgets.
The decision not to seek additional approval for expenditure from the Legislature also comes in the face of caution that the government may miss its budget targets as its first half performance hasn’t been encouraging.
The Institute for Fiscal Studies for instance warned that government will miss its 2017 budget target should it fail to spend in critical sectors of the economy.
The IFS argues that government’s refusal to pay valid arrears and invest in infrastructural development for the first half of this year has impacted heavily on economic growth.
The Executive Director of the IFS, Professor Newman Kusi explains that the cut in some critical expenditure has affected economic performance so far.
“The cuts in expenditure have been affected; those that we actually need such as the capital spending, earmarked funds, payment for goods and services among others. But then again the government has its hands tied at its back because it cannot cut back on wages and salaries, interest payments, etc and these together take a disproportionate share of the revenue that is collected,” he stated.
Some of the key areas that Mr. Ken Ofori Atta is expected to touch on is revenue shortfalls, impact of declining commodity prices on economy, government debt levels as well as progress with the International Monetary Fund (IMF).