Business News of 2014-05-29

Monitor govt budgets to achieve results

Ghana’s economy faces more development threats if urgent measures are not put in place to address the poor execution and monitoring of government budgets, Mr Santiago Herrera, a lead economist at the World Bank in charge of Ghana, has stated.

He said until the government bridged the huge gap between its budgets appropriation and expenditure, the economy of Ghana would continue to suffer.

“When there is lack of connection between budget appropriation and expenditure, arrears are always generated because the cash flow of the government is not done efficiently and realistically,” Mr Herrera told participants from civil society groups and government agencies at a budget workshop in Accra.

Budget workshop

The two-day forum, which is being organised by the World Bank, is on the theme, “Improving Accountability and Public Outcomes through Independent Budget Monitoring”.

The purpose of the workshop is for the participants to discuss reports produced by the Public Interest and Accountability Committee (PIAC) and civil society organisations on the monitoring of budgets and examine the results of public spending.

Educational sector

Stating some instances to back his claim, Mr Herrera said although the public expenditure in Ghana’s educational sector was similar to that of other countries, the country continued to record low progress, adding that progress in Ghana could not be compared to that in those countries.

“The possible explanation is that there is no monitoring mechanism in place, as teachers continue to be paid for no work done. Absenteeism in Ghana’s educational sector is on the high rate,” he added.

Way forward

According to Mr Herrera, in order to address the challenges, the execution and monitoring of government budgets must be prioritised to enhance effectiveness of public spending. He said the government must also support growth by making use of public resources through the Public Investment Management System (PIMS) and other reforms.

Ghana’s economy

In a speech read on his behalf, the Country Director of the World Bank, Mr Yusupha Crookes, said in spite of Ghana’s impressive performance on democratic governance, the country continued to face critical fiscal and economic challenges.

“These challenges, expressed partly in macroeconomic instability and ineffective delivery of public services, affect all citizens, particularly the poor,” he added.

To support the government to tackle those challenges, Mr Crookes said, the World Bank’s Country Partnership Strategy (CPS) for the next three years had, as one of its pillars, support to improve economic institutions.

According to him, the objective of the CPS was to focus on strengthening budget institutions and public financial management systems to enable them to deliver on their mandate.

Source: graphic.com.gh
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