A former Minister of Finance and Economic Planning, Mr Seth Terkper says government’s admission that it will continue to borrow is a “humbling fiscal reality and necessity” that has been occasioned by revenue shortfalls in the midst of exploding expenditures.
Mr Terkper said, the government faced with this reality has resorted to offsets instead of paying arrears.
The former Minister in a tweet on Tuesday, October 30 said the government was experiencing revenue shortfalls despite keeping taxes that should have elapsed.
It is also introducing new taxes and levies, making income tax regressive, and toying with a distorted VAT regime that is increasing prices and not revenues, he said.
He added that expenditures were also bloating “due to dogmatic adherence to campaign promises; and despite ‘capping’ of statutory funds and additional revenues from TEN and Sankofa fields.”
Seth Terkper also accused the government of using these oil revenues for consumption expenditure at the expense of investments and debt management.
He predicted that with revenues falling below expenditures and budget deficits widening, leading to financing needs, borrowing and debt were set to further increase.
He, however, cautioned the government to borrow prudently by taking a cue from the NDC government’s ‘smart borrowing’ policy.
The tweet by the former Finance Minister was in apparent response to President Nana Addo Dankwa Akufo-Addo who says that government will continue to borrow to develop the economy.
Earlier, former President John Mahama had asked the government to apologise to Ghanaians for making a U-turn on borrowing.
While in opposition, the New Patriotic Party had criticised the Mahama Administration for what it said was unbridled accumulation of debt, with then running mate and current Vice President Dr. Mahamud Bawumia calling borrowing a lazy approach to economic management. He had said an NPP government would prudently use internal resources to develop the country.
The government has, however, borrowed some GH¢40 billion since taking office in January 2017.
Source: graphic.com.gh
Disclaimer: Opinions expressed here are those of the writers and do not reflect those of Peacefmonline.com. Peacefmonline.com accepts no responsibility legal or otherwise for their accuracy of content. Please report any inappropriate content to us, and we will evaluate it as a matter of priority. |
Terkper,tell them especially the ***barred word*** finace minister ken ofori atta and the moron bawumia. npp is so ***barred word***,you increase vat,introduce excise duties on consumables and you expect to meet your revenue target,hell no. even nobody is drinking beer again...stupi npp
Terkpe amazes me. You ran down an economy growing at 14% in 2010 down to 3.6% and you have the guts to talk about the economy? Agric under Fiifi Kweetey was running negative. Please don't distract us. If you knew all these why are we where we are?
@hamid, what economic strategies are you talking about? Do you mean negative growth in agriculture or the flying guinea fowls? You guys have no shame! You run down an economy growing at 14% in 2010 down to 3.6% and you have the guts to talk about the economy? Is it corruption or incompetence you want NPP appreciate? It is good that these hardships you are referring to are coming now, showing they are the effects of your poor handling of the economy that we are seeing. These will surely ease before the heat of the 2020 campaign starts. We will see the campaign message the NDC will use in 2020.
This government was voted to clear the mess and up till now, we are not seeing any improvement.
U knew all these and left us in that mess? Massa let's think u are not the one we have to listen to get away.
Massa man dey hala too much under this govt.
its sad NPP has more lawyers than Economist hence their inability to appreciate what NDC economic strategies. Now the hardship today is unprecedented.
You mean government is now coming to term with the enormity of the real mess you created? Yea Yea Yea.