The Minister for Finance, Dr. Cassiel Ato Forson, has outlined the key factors driving Ghana’s rising wage bill and compensation costs, highlighting challenges in the management of public sector salaries.
Speaking at the Presidential Dialogue with Organised Labour on Tuesday, March 17, 2026, Ato Forson revealed that 39% of Ghana’s national expenditure is allocated to public sector wages and compensation.
He outlined the main drivers of the increasing wage bill as:
- Annual base pay adjustments
- Growth in employment levels within the public sector
- Requests for new or incremental adjustments in existing conditions of service, such as institution-specific allowances
- Legislative and Administrative approvals leading to enhancement in pay and pension obligations arising from improved conditions of service.
Dr. Forson also raised concerns about the legislative framework governing public sector pay. He noted that several legislative instruments provide enhanced conditions of service for some institutions, which he said contravene the 1992 Constitution.
He further highlighted that some Acts empower Boards of public institutions to determine staff conditions of service without consulting the Ministry of Finance, a practice he flagged as inconsistent with the Public Financial Management Act.
The Minister further provided a breakdown of how recent conditions of service reviews have contributed to the rising wage bill.
“In the year 2024 alone, the conditions of service review added GHS2.4 billion to the wage bill. The Ministry of Education is the one that led the chat with about GHS1.3 billion. In the year 2025, we saw that the conditions of service review alone added GHS6 billion to the wage bill.
“Of this, the Ministry of Interior alone contributed GHS5.7 billion, and these decisions were taken prior to the elections, where a huge number of people were employed.
“In 2026 so far, we have received from the Fair Wages and Salaries Commission, proposals of conditions of service amounting to GHS7.4 billion, which we are reviewing,” he stated.
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