Fiscal Responsibility Act must limit its suspension period in case of emergency - IEA

The Institute of Economic Affairs (IEA) has urged the government to restrict the duration of suspensions to the Fiscal Responsibility Act during emergencies. In light of recent discussions surrounding the law's flexibility amidst crises, the IEA emphasized that any temporary suspension should be tightly controlled to prevent long-term fiscal irresponsibility. The Act is designed to promote sustainable economic practices by mandating that government expenditures do not exceed certain limits unless justified by extraordinary circumstances.

The IEA argues that while it is essential for governments to respond effectively in times of crisis, maintaining fiscal discipline is crucial for fostering investor confidence and ensuring economic stability. To achieve this balance, they advocate for a clearly defined timeframe for suspensions, which would allow for necessary emergency measures without undermining overall financial governance. By setting a limit on how long these exceptions can last, the IEA believes that Ghana can better navigate economic challenges while still adhering to principles of sound fiscal management. This approach aims to safeguard future economic resilience and accountability in governance.