Economic hardship: 12 cost-cutting measures announced by Ken Ofori Atta

Kandey Alhassan March 28, 2022 0

Finance Minister, Ken Ofori Atta on Thursday, March 24, 2022, outlined some initiatives the government is taking to save the economy.

The Minister amongst others announced 12 economic measures to deal with the current challenges facing Ghana’s economy.

According to Mr. Ofori Atta, these measures will ensure the 7.4% deficit target set in the 2022 budget is met.

The government has already announced a 20% expenditure cut as part of fiscal stabilization and debt sustainability measures.

Below are the cost-cutting measures announced by Finance Minister, Ken Ofori Atta;

1. The government plans to cut discretionary spending by an additional 10 per cent. The Ministry of Finance is meeting with Ministries, Departments and Agencies to review spending plans for the rest of the year.
2. There will be a 50 percent cut in fuel coupon allocation for all political appointees and heads of government institutions to ensure efficient use of energy resources. This measure is effective April 1, 2022. Fuel coupons normally account for over GHS 60 million, according to the Finance Minister.
3. The suspension of the purchase of imported vehicles for 2022 to reduce total vehicle purchases for the year. This will affect all new orders, especially Four-wheel drives.
4. The suspension of all foreign travels except pre-approved statutory travels or critical travels.
5. The government plans to conclude measures to eliminate ghost workers from the government payroll by the end of 2022.
6. The government hopes to conclude renegotiations of the Independent Power Producer capacity charges by the end of the third quarter of 2022 to further reduce capacity payments by 20 percent to generate total savings of GHS1.5 billion.
7. Moratorium on the establishment of new public sector institutions by the end of April 2022
8. Prioritise ongoing projects over new projects to enhance the efficient use of limited public funds by finishing ongoing or stalled projects
9. The reduction of expenditure on all meetings and conferences by 50 percent.
10. Pursue reprofiling strategies to reduce the interest expense burden on the fiscal.
11. The government also plans to liaise with organised labour to implement measures in the Kwahu declaration of the 2022 National Labour Conference. These include reforms towards addressing salary inequities.
12. Ministers and the Heads of SOEs will also be contributing 30 percent of their salaries from April to December 2022 to the Consolidated Fund.

Meanwhile, the Minority in Parliament, say the measures taken to tackle the economic challenges confronting Ghana are inadequate, given the gravity of the situation in which the country finds itself.

“Our [the Minority’s] immediate response to the Honourable Minister for Finance is to state emphatically and unequivocally that he has lost touch with reality. He is not in tune with the state of the Ghanaian economy," Minority Leader, Haruna Iddrisu told the media.

He also reiterated the National Democratic Congress' (NDC) resolve to vote against the Electronic Transaction Levy (E-Levy) Bill.

Pulse.com.gh