The Finance Minister, Ken Ofori-Atta, has indicated that he has written to the Speaker of Parliament, Alban Bagbin with details of some amendments the government has made to the 2022 Budget Statement and Fiscal Policy following concerns raised by various stakeholders.
Briefing the press on the amendment on December 6, 2021, Mr. Ofori Atta said “On behalf of the President I have written to the Right Honorable Speaker of Parliament with details of amendments in response to emerging concerns by all stakeholders including the Minority caucus.”
Below is the full statement of the letter:
MODIFICATIONS OF THE GOVERNMENT’S 2022 BUDGET STATEMENT AND ECONOMIC POLICY
The Ministry of Finance respectfully presents its compliments to the Rt. Hon. Speaker and refers to the 2022 Budget Statement and Economic Policy presented to Parliament on 17h November 2021,
the ensuing debates on the floor of Parliament, reactions and contributions, and comments from Faith-Based Organizations, Unions, Employers, Students, Csos, the General Public, and the subsequent concerns raised by the Minority Caucus in Parliament.
The Budget outlines the policy direction and fiscal framework for 2022, with a deficit target of 7.4% and a positive primary balance of 0.1%, as well as the medium-term vision of the President under the theme: Building a Sustainable Entrepreneurial Nation: Fiscal Consolidation and Job Creation.
3. Mr. Speaker, under this theme, the most significant policy measure in this Budget is the introduction of the multi-year GHC 10 Billion YouStart Program, a historic intervention that will involve the collaboration of our Local Financial Institutions, Development Partners, and International Financial Institutions. It seeks to tackle youth unemployment. This program is designed to provide relevant skills and access to long-term affordable capital to empower our youth to create their businesses and expand the private sector to employ more Ghanaians.
Mr. Speaker, on Tuesday, November 30, 2021, before its approval, and to achieve consensus asked Parliament for an opportunity to effect some modifications to the 2022 budget. I did this after consulting with the President and also to respect his wish that these modifications address the concerns of the Minority Caucus and various other stakeholders, whilst ensuring that a deficit target of 7.4% and a positive primary balance be maintained given the nation’s determination to reduce Our debt levels, raise adequate revenue to promote youth employment, build infrastructure (especially our roads) and fund other Government obligations, including the Flagship Programmes.
5. Mr. Speaker, I hereby write to confirm the details of these modifications:
i. With regards to Agyapa Royalties Ltd, we shall amend paragraphs 442 and 443 to take out references to mineral royalties’ collateralization. It is important to note that, any reference to Agyapa was for informational purposes, and as such was not reflected in the fiscal framework; in respect of the unfortunate tidal waves which rendered about 3,000 people homeless in Keta, Ketu South, and Anloga constituencies, we shall make the necessary budgetary allocations of at least GHS 10 million to complete the Feasibility and Engineering studies for the coastal communities adversely affected. We will broaden the scope of the study to consider a more comprehensive solution to protect Ghana’s 540 Km of coastline, including the 149 Km between Aflao and Prampram.
Meanwhile, NADMO has responded to the humanitarian crisis created by the tidal waves on the Keta coastline; relating to the Aker Energy transaction, we shall amend paragraph 829 of the 2022 Budget on the acquisition of a stake from Aker Energy and AGM Petroleum by GNPC, to reflect the resolution of Parliament dated 6th July 2021 that “the terms and conditions of the loan for the acquisition of the shares shall be brought to Parliament for consideration under article 181 of the Constitution; and
ii. On the benchmark values, we shall avert any hardships to importers and consumers while safeguarding the interest of local manufacturing industries to secure and expand jobs for our people.
This administrative exercise which reviewed 43 out of 81 line items has the objective to promote local manufacturing and the 101F policy, including the assembling of vehicles. It is important to note that this adjustment affects only 11.4% of the total CIF value, of which 50% is for vehicles. From our analysis, the potential increase in retail prices should be relatively insignificant and therefore inflation should be muted. The youstart program will also support our resourceful Traders with appropriate training and access to capital to become manufacturers to expand the industrial base of our society and our import substitution strategy, in line with our Ghana Beyond Aid agenda.
iv.
6 Mr. Speaker, we will work with the relevant Committees of Parliament to reflect these modifications in the 2022 Budget as is the usual practice, before the Appropriation Bill is passed. Any other concerns which may emerge shall be addressed during the discussions of the estimates by the Committees, as has been the tradition.
#continues our consultations with the Minority Caucus in Parliament and other relevant stakeholders, to achieve consensus and revert to the House in the most shot possible time.
Mr. Speaker, on the matter of the E-levy, having regard to its serious fiscal implications, we will thank the House for the valuable contribution to our work as a Ministry and will count on your support for approval of the estimates and appropriations for the 2022 Budget Statement and Economic Policy, as we have done by consensus in the past 5 years. We continue to be a Government that is committed to engagement and consensus building in the execution of Government policies.
9. Mr. Speaker, the President’s goal is to raise adequate domestic revenue by expanding the tax net to tackle boldly and creatively the important issues of job creation, infrastructure delivery, and debt sustainability. Mr. Speaker, raising the required revenue will require sacrifice and burden sharing by all of us. The government on its part shall continue to rationalize expenditures, protect the public purse, whilst ensuring the efficient use of taxpayer contributions and value for money.
Kindly accept, Right Honourable Speaker, the assurances of my highest esteem.
KEN OFORI-ATTA, MINISTER
