Business News of 2014-03-31

Finance Minister’s address to Parliament deferred

Parliament has rescheduled a major presentation by Finance Minister Seth Terkper on the state of Ghana's economy and measures to arrest the challenges facing the economy.

Mr Seth Terkper was in Parliament House Monday to make his presentation but due to reasons yet to be made public, the presentation has been deferred to Tuesday, April 1, 2014.

Joy News' Elton John Brobbey who confirmed the change reported the minister may announce a redeployment policy of civil and public sector workers when he returns to the House.

He said some public sector workers are likely to be shifted to other areas in public service where their services may be needed most. The policy, Elton Brobbey said, is part of measures and policies government hopes to implement between now and 2017 with the aim of stabilising the country's troubled economy.

Ghana's economy is facing many structural challenges including a strangling budget deficit, rising inflation, falling cedi value with a worsening power and water crisis.

These challenges have led to the inability of government to pay statutory funds such as District Assembly Common Fund, Ghana Education Trust Fund and in some cases salary arrears of public sector workers.

Several reasons have been cited for the ailing state of the economy. The Finance Minister's presentation to Parliament will centre on government's plans to bring the economy back on a sound footing.

Sources within government told Brobbey the Minister will announce, among other things, drastic measures on the public pay policy, the Single Spine Salary Structure. He would also reiterate government's policy to freeze employment in the public sector in order to keep the public sector wage bill within acceptable limits.

The government has been lamenting a reduction in donor support, a situation that has been cited for the downward trend in the growth of the economy. According to a source, government in the 2013 financial year received only 30 per cent of the expected 50 per cent budget support from the donor partners.

According to Brobbey, he has also picked snippets of information which indicate that the Minister may also announce a reduction in the amount of money paid into the District Assembly Common Fund.

Currently government is expected to yank off 7.5 per cent of its total revenue to the District Assembly Common Fund. Some sources in government claim the amount is too high and there is the need for a reduction.

A source told Brobbey that a cabinet meeting held yesterday on the matter was inconclusive as members were sharply divided on whether or not there should be a reduction in the amount paid into the District Assembly Common Fund. The Finance Minister is expected to make public the decision taken by government, Tuesday.

Source: myjoyonline.com
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