Government enacts landmark Public Financial Management Act to enhance fiscal discipline

The Finance Ministry has announced the Public Financial Management (Amendment) Act, 2025. This law aims to improve fiscal discipline and accountability in Ghana. It also seeks to ensure long-term economic stability.

The reform introduces stricter oversight mechanisms and fiscal responsibility rules. An independent Fiscal Council will enhance transparency and compliance.

Key reforms include:

1. **Enhanced Sanctions for Fiscal Mismanagement**:
- The Minister of Finance can face censure for breaching fiscal rules.
- Ministers and Heads of Covered Entities may face imprisonment for contributing to fiscal slippages.

2. **New Fiscal Responsibility Measures**:
- A primary balance rule requires an annual surplus of at least 1.5% of GDP.
- A public debt ceiling caps the debt-to-GDP ratio at 45% by 2034.

3. **Creation of an Independent Fiscal Council**:
- This autonomous council will monitor adherence to fiscal responsibility rules.

4. **Strengthened Oversight and Accountability**:
- The Minister must get approval before suspending fiscal rules due to emergencies.

5. **Consolidation of Fiscal Management Laws**:
- All fiscal rules are unified under a single legal framework for better enforcement.

With this new law, the Fiscal Responsibility Act, 2018 (Act 982) is repealed. The Presidential Fiscal Advisory Council is also dissolved, streamlining oversight under the new Fiscal Council.

These reforms come ahead of the September 2025 deadline for the IMF-supported program. They show the Ministry's commitment to restoring fiscal discipline and enhancing transparency in Ghana.

The Ministry is dedicated to implementing these laws fully. It will work closely with stakeholders to maintain Ghana’s macroeconomic stability and prosperity.