Measures announced by Minister For Finance, Ken Ofori-Atta to mitigate current challenges

Measures announced by Minister For Finance, Ken Ofori-Atta  to mitigate current challenges

The Finance Minister on Thursday 24th March, 2022 announced measures to mitigate the current challenges faced by the country. The measures are:

  • Discretionary spending to be further cut by an additional 10%.
  • 50% cut in fuel coupon allocations for all political appointees and Heads of government institutions, including SOEs, effective 1st April 2022.
  • With immediate effect, imposed complete moratorium on purchase of imported vehicles for rest of the year. This will affect all new orders, including 4-wheel drives.
  • With immediate effect, imposed a moratorium on all foreign travels, except pre-approved critical/statutory travels.
  • Conclude on-going measures to eliminate “ghost” workers from payroll by end December 2022.
  • Conclude renegotiation of Energy Sector IPPs capacity charges by end of Q3-2022 to further reduce excess capacity payments by 20% to generate total savings of GHS1.5 billion.
  • Impose a moratorium on establishment of new public sector institutions by end April, 2022.
  • Prioritise ongoing public projects over new projects, to enhance the efficient use of limited public funds over the period by finishing ongoing or stalled but approved projects.
  • Reduce expenditure on all meetings and conferences by 50%, effective immediately.
  • Ministers and the Heads of SOEs to contribute 30 percent of their salaries from April to December 2022 to the Consolidated Fund.
  • Pursue re-profiling strategies to reduce the interest expense burden on the fiscal.
  • Liaise with Organised Labour and Employers Association to   implement with immediate effect, the measures captured in the Kwahu Declaration of the 2022 National Labour Conference, including reforms towards addressing salary inequities / inequalities (e.g. Article 71 Office Holders), the weak link between pay to productivity and the sustainability of the payroll.
  • Reduce margins in the petroleum price build-up by a total of 15 pesewas per litre with effect from 1st April. The details are as
    follows:
  1. BOST margin reduced by 2 pesewas per litre
  2. Unified Petroleum Pricing Fund (UPPF) margin reduced by 9 pesewas per litre
  3. Fuel Marking Margin (FMM) reduced by 1 pesewa per litre
  • NPA in discussion with the OMCs to reduce their margins within the spirit of burden-sharing.
  • Government will partner the private sector to introduce digital systems to monitor quarrying, sand winning and salt winning to get more revenues from our natural resources.
  • Immediately enforce the “No Duty – No Exit” policy at the MPS Terminal at the Tema Port to improve revenue collection.
  • Conclude external financing arrangement of up to US$2 billion in the next 2-6 weeks in line with approved external financing for 2022 and for liability management.
  • Work with  Central Bank to review foreign exchange retention policy to ensure multinational companies in extractive sectors retain foreign exchange earnings, from sale of our resources, in the country.
  • Wean-off public tertiary institutions from government payroll and provide them with a fixed amount “block grant” instead.
  • Pursue reforms to address structural challenges in public financial management including procurement and commitment control, payroll management and human resource management.

More revenue measures

  1. Begin the implementation and collection of the revised Property Rate by end of April 2022.
  2. Implement the E-VAT/E-Commerce/E-Gaming initiatives by end of April 2022.
  3. Roll out the simplified tax filing mobile application for all eligible taxpayers by July 2022.
  4. Impress upon Parliament to fast track the passage of the E-Levy Bill, Tax Exemptions Bill, and Fees and Charges Bill.
  5. Prioritise Revenue Assurance, Compliance, and Enforcement (RACE) Programme to plug revenue leakages especially at the ports.

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