Economist and senior lecturer at the University of Ghana, Professor Lord Mensah, has criticised the Minister of Finance, Dr. Mohammed Amin Adam for failing to present an interim budget for the first quarter of 2025.
In a social media post on December 20, 2024, Professor Mensah highlighted the significant economic repercussions of this oversight, describing it as a "lacuna in our economic management dynamics."
He warned that Ghana's fragile economy cannot afford such lapses.
“The implications of the finance minister's failure to present the interim budget are enormous. It is a lacuna in our economic management dynamics, and a fragile economy like Ghana cannot afford to contain this. An economy that has been dominated by government business for the past eight years cannot be exposed in this manner,” Professor Mensah stated.
He further explained that without the interim budget, government activities between January 1 and January 7 would lack the legal backing of the Appropriations Act.
“What it means is that between January 1 and 7, expenditure and revenue mobilization will not be backed by the Appropriations Act of Parliament, and as such, it’s illegal. It also means the government will not be spending within this seven-day period and will not collect taxes during this time. Citizens and businesses can avoid taxes and levies without punishment. Furthermore, the government cannot charge full-month income tax in January; income taxes can only take effect from January 8 if the new administration is able to present the budget the same day,” he explained.
Professor Mensah also warned of the potential economic consequences saying, “In the short term, salaries, goods and services, and interest on short-term bills may be affected, which could impact labor output and government operations. In the long term, no investor will take Ghana seriously. Parliament, the finance minister, and his deputies must be held accountable for the huge economic cost created within this period. Perhaps they should even sacrifice their ex-gratia.”
NDC Minority Leader offers assurance
In response to the situation, Minority Leader in Parliament, Dr. Cassiel Ato Forson, has assured Ghanaians that the National Democratic Congress (NDC) government will act swiftly to address expenditure needs for the first quarter of 2025 after assuming office on January 7.
Speaking to the press in Parliament after the House adjourned until January 2, Dr. Forson criticised the outgoing government for its lack of preparedness, describing it as a governance failure.
“The absence of a mini-budget could disrupt essential services and obligations, with the burden falling on ordinary citizens,” he said.
Dr. Forson further warned that the Akufo-Addo government would be held accountable for any disruptions caused by this lack of financial planning.
However, he assured Ghanaians that the incoming NDC administration would act urgently to stabilize the economy and meet necessary expenditures.
“The NDC Minority Caucus would like to assure the good people of Ghana and all stakeholders that the NDC government, which will take office on January 7, 2025, will act with dispatch to address expenditure for the first quarter of 2025,” he said.
“There is no cause for alarm! Even though there will be no Minister of Finance on January 7, 2025, the Vice President can present to this House the expenditure in advance of appropriation anytime after the swearing-in on January 7, and Parliament will be properly constituted to expedite its approval,” Dr. Ato Forson added.
AM/MA
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