Ministry of Finance Prosecutes Finance Directors for Overspending
The Ministry of Finance has cautioned that it will prosecute Chief Directors and Heads of Ministries, Departments and Agencies (MDAs) as well as Metropolitan, Municipal and District Assemblies (MMDAs) who award contracts not budgeted for in a given year.
The caution is to check the over-expenditure that has been perpetuated by the various heads of government institutions leading to the rise in government’s debts.
The potential of such departmental heads to over award contracts the Ministry contends has also been influenced by the lack of adherence to proper procurement procedures.
The Acting Director of Budget at the Ministry of Finance, Ms Eva Mends tells Citi Business News the enforcement of the law should halt the debt overhangs going forward.
“People do not respect the limit Parliament sets on how much government can commit over a period. When we prepare a budget we do not just prepare an annual budget we prepare a medium term expenditure framework which indicates how much revenue we are getting and how much expenditure we intend to make.”
“So when you go ahead and commit government over and above what has been indicated and it falls due, you are breaking the law and appropriation is a law which is also a legal document,” she explained.
Ms Eva Mends made the observation during a response to concerns on measures to reduce government’s accumulating arrears particularly those due contractors.
It also formed part of a stakeholders’ consultation for the 2018 to 2021 budget preparation by the government of Ghana.
The Deputy Roads Minister, Anthony Karbo has lamented the 11.6 billion cedis debt the government inherited from the NDC administration which has made it practically impossible to undertake new road projects.
This Mr. Karbo explains the challenge in repaying the debt has also been as a result of the relatively ‘lower’ amounts accruing to government from the road fund which is 1.2 billion cedis annually.
Already, the Deputy Finance Minister, Kweku Kwarteng had given indication of reviewing the various contracts awarded under the former government to ascertain the validity or otherwise of such agreements.
This also followed a comment from Finance Minister, Ken Ofori Atta that the government will work to pay all outstanding arrears by 2019.
With the effective implementation of the law to punish directors who over award contracts, the Finance Minister is confident of meeting the anticipated expenditure targets and restore macro-economic stability.