The minister of finance, Seth Terkper, during the presentation of the supplementary budget, announced that the Government of Ghana was seeking an additional GHS1.8billion to supplement the 2016 budget for the second half of this year.
He said the amount would help the government make up for its revenue shortfall.
The November budget projected oil revenues at $53/barrel but oil prices are still hovering under the $50 mark, which means the expected oil revenue has not been met. In addition to the sharp fall in oil prices, technical faults that bedevilled FPSO Kwame Nkrumah in the Jubilee oil fields also frustrated oil production and gas supply, which in turn had a negative impact on expenditure. Also, the third tranche of the $918million IMF bailout money is yet to be released. Further, the delay in launching another $1bn Eurobond has also created a revenue shortfall, which needs plugging.
Mr Terkper said most of the targets set by the government for 2016 were not met, thus the need for GHS1.8billion more to shore up things. According to him, tax revenue of GHS11billion fell by 6.4 per cent to GHS10.3billion, while the cash deficit increased to 2.5 per cent as against the 2.2 per cent target. According to him, the Gross Domestic Product (GDP) rate grew by 3.8 in 2015, while the economy grew at 4.9 by the first-quarter of 2016, compared to 4.5 per cent in 2015.
But speaking in an interview with Chief Jerry Forson, host of Ghana Yensom on Accra 100.5FM Tuesday July 26 in relation to the mid-year budget, Dr Akoto Osei said: “Last year, the finance minister said we were growing at 3.9 per cent but in 2000, when the [first] NDC government was exiting office, the growth rate was 3.5 per cent. After almost sixteen years, we haven’t been able to reach even 4 per cent.”
According to him, the mid-year budget presented nothing concrete to deal with the challenges Ghanaians were saddled with.
“How can we deal with unemployment and economic hardship and erratic power supply that have affected several businesses? The only option now left for businesses is to lay off workers,” he said on the show.