Finance Minister outlines measures to tackle Ghana’s large payable build-up in 2024

Finance Minister Dr. Cassiel Ato Forson has shared a plan with investors. This plan aims to tackle the country's large government payables in 2024. It also focuses on improving fiscal discipline and transparency in public financial management.

Dr. Forson spoke at an investor meeting in Washington, D.C. He highlighted key reforms to restore confidence in Ghana's fiscal framework. The goal is to stabilize the country's macroeconomic outlook.

Auditing Payables & Commitments

A major part of the plan is an audit of all outstanding payables and commitments. The Ministry of Finance has hired the Auditor General and two independent firms for this review. This intensive audit will last eight weeks.

“The objective is to verify the legitimacy and accuracy of these claims,” said Dr. Forson. The findings will help implement corrective actions for any irregularities.

Strengthening Commitment Controls

To prevent unapproved expenditures, the government has amended the Procurement Act. Starting April 3, 2025, no contract will be approved without prior authorization from the Ministry of Finance.

“This measure enhances spending controls,” Dr. Forson stated, “and ensures compliance with the Public Financial Management (PFM) Act.”

PFM Act Amendment and Fiscal Rules

The government has also amended the Public Financial Management Act, 2016 (Act 921). Two major fiscal rules have been introduced as part of this amendment.

The first rule targets reducing the debt-to-GDP ratio to 45% by 2035. The second mandates an annual primary surplus of at least 1.5% of GDP on a commitment basis.

An Independent Fiscal Council will monitor adherence to these rules, enhancing transparency in public finance.

Enforcing Compliance and Oversight

To strengthen fiscal discipline further, a new Compliance Division has been established within the Ministry. This division will monitor how Ministries, Departments, and Agencies (MDAs) follow fiscal commitments.

A newly appointed Director leads this division's efforts. Additionally, a Public Financial Management Commitment Control Compliance League Table will rank MDAs based on their expenditure control performance.

Restoring Confidence

“These actions show our commitment to resolving legacy financial obligations,” said Dr. Forson. He assured investors that the government aims for stability and long-term growth through transparent financial management systems.