President John Mahama says he is happy that his government has not overspent its 2016 budget in spite of pressures from various sectors to spend more on projects not budgeted for.
According to him, government remains firm in its resolve not to spend beyond what it budgeted for the year.
The President noted that Ghana has consistently in every election year overspent its budget, leaving the country in a difficult economic times the subsequent year.
“Happily we are in an election year and we haven’t overspent even though there is pressure from everywhere,” he said.
Speaking at the Holy Ghost Temple of the International Central Gospel Church at Adenta in Accra over on Sunday, he said, “one of the major problems this country has suffered is that vicious cycle where every four years we go back into an economic instability and you have to take tough economic measures to stabilize the economy again.”
“One of the major challenges we have been dealing with is how to stabilize the economic even through an election year by keeping down expenditures and increasing revenues,” he said.
If your expenditure is high and your revenue is low then you will have a deficit which will keep growing until the country becomes so indebted that nobody will be prepared to lend you any money and your currency will depreciate,” he added.
President Mahama said government has taken measures to ensure its expenditure increases slowly while revenue is increased through taxes.
“[If] you have only 30 per cent of people paying taxes, 70 per cent of the people don’t even know you must file your tax returns then you must find an ingenious way to get it through indirect taxes so that at least everybody is contributing his quota to make the economy stable,” he further said.
Mahama said government wants to ensure that the country’s currency and economy is stable after the election period.
He revealed that the cedi has been one of the best performing currencies in Africa, a development he said is a positive sign of effective economic measures.
On energy, he indicated that Ghana is working to increase its power generation capacity so that it is able to have excess power to serve as back up in case it loses a thermal plant.
‘We’ll not overspend on election 2016’
Mahama in August last year said vowed that government will ensure that Ghana does not go for another IMF bailout due to election year expenditure overruns.
According to him, the fiscal imbalances, experienced after the electoral cycle, mostly arise as a result of excessive demands on government by labour unions.
The Minister of Finance, Seth Terkper also reiterated government’s position when he presented the 2016 budget in Parliament.
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