The Mid-Year Budget Review today will not make new financial demands, a source at the Ministry of Finance has stated.

It explained that the budget would, however, reprioritise many programmes and seek to maximise efficiencies in order to achieve the desired sustainable economic growth.

The source stated that in line with the Post COVID-19 Programme for Economic Growth (PC-PEG), now supported by the three-year Extended Credit Facility arrangement with the International Monetary Fund (IMF), the review would also allocate additional resources for the social intervention programmes, such as the Livelihood Empowerment Against Poverty (LEAP), Capitation Grant and the Free Senior High School (Free SHS) initiative.

Sources at the Ministry of Finance told the Daily Graphic in Accra yesterday that half-year figures, which would be provided in the Mid-Year Budget, show an increase in the number of beneficiaries in key programmes such as LEAP, school feeding, Free SHS, and the capitation grant for basic school enrollment.

It said the government was also working towards fulfilling the two indicative targets regarding social protection for this year.

The source explained that the budget would ensure that releases were ramped up to ensure that not less than GH¢2.03 billion was channeled into the National Health Insurance Scheme (NHIS), LEAP, Capitation Grant and School Feeding Programme as half-year releases.

The budget would also ensure that GH¢3.05 billion would have been channeled into those social protection programmes by September 2023 and GH¢4.07 billion by December 2023.

To guarantee that the commitments are met, the government had set up a task force to ensure that social spending was well targeted and impactful, the source revealed.

The task force would also ensure that the social protection expenditure targets were met by the next IMF review mission in September.

 Towards that end, the government would conduct an indexation mechanism to ensure that inflation did not erode the value of LEAP benefits, the source at the Ministry of Finance added.

Macroeconomic restoration

A statement released by the Ministry of Finance last Friday, indicated that the Mid-Year Budget Review would give an insight into the measures being employed by government to restore macroeconomic stability to spur economic growth.

“The issues that will be highlighted include structural reforms in expenditure commitment control and arrears clearance; debt management; financial stability and a growth agenda, among others,” the statement added.

The Ministry of Finance also said the review would give an update of the implementation of the 2023 budget objective, “with insights into the economic and fiscal performance for the first half of the year.”

Legal framework

The Mid-Year Budget Review is in accordance with Section 28 of the Public Financial Management Act, 2016 (Act 921), which stipulates that the minister “shall, not later than the 31st of July of each financial year, prepare and submit to Parliament a mid-year fiscal policy review”.

Per Section 28(2) of Act 921, the Mid-Year  Budget Review shall include a “a brief overview of recent macroeconomic developments of government, an update of macroeconomic forecasts undertaken by government and an analysis of the total revenue, expenditure and financing performance for a period up to the first six months of the financial year,”

The Minister of Finance, Ken Ofori-Atta, was management’s failure to ensure the security and safety of vital documents, management’s inertia in complying with procedures stipulated in the Public Financial Management Act, and poor accounting systems.

The report urged management teams of the public boards, corporations and other statutory institutions to strengthen supervisory controls over their finance officers and ensure that they adhered to the provisions of the Public Financial Management Act, 2016 (Act 921).

“I also recommended the authentication of all payment vouchers, prompt payment to bank and full retirement of accountable imprest on due dates.

“These lapses were caused by the failure of management to exercise due diligence and the tolerance of officers in charge of payroll validation in reviewing payment vouchers to ensure salaries were paid to only those who were entitled as well as payroll related irregularities,” the report stated.

“They were also caused by management’s failure to notify banks to stop the payment of unearned salaries,” it observed.

The Controller and Accountant-General’s Department also did not promptly delete names of separated staff when notified to do so.

In other instances, management also did not transfer statutory deductions in respect of social security contributions.

Contained in the payroll irregularity was GH¢6.49 million and GH¢3.42 million owed by the Microfinance and Small Loans Centre and Volta Star Textiles Limited, respectively, in respect of social security contributions.

The Auditor-General advised the management teams of the affected institutions to promptly notify the bankers of the separated staff to withhold and pay to the Auditor General’s Recoveries Account all unearned salaries.

“I also recommended that officers in charge of payroll should exercise due care in the discharge of their duties as well as ensuring that first and second tier contributions for their employees are promptly and regularly transferred to the various pension schemes,” the report added.

SOURCE: GraphicOnline