Former Finance Minister Seth Terkper has asked the Akufo-Addo government to come clean on what it used the GHS10-billion COVID-19 accruals for.

Speaking to journalists ahead of Finance Minister Ken Ofori-Atta’s mid-year budget review presentation on Thursday, 23 July 2020, Mr Terkper said: “The financing, which we secured purposely for COVID, the $1 billion IMF loan, the World Bank support, the Stabilisation Fund withdrawal, other releases that we have got, all amount to about, at the time we did our calculation, GHS10 billion. I think I heard the Minority say that it’s about GHS16 billion, which is higher than the cost of COVID. So, even though the cost of COVID could have gone up, it is important to note that back then, when the Bank of Ghana financing and other financing were being considered, we had secured enough for COVID.”

“So, why were we getting those additional borrowings and the rest?” he asked.

“The only explanation is that the borrowing was being done or is being done to finance items that were not being disclosed,” Mr Terkper explained.

“So, we are saying that it will be good for us to come now and explain why we have a difference with the IMF”.

“I’ve said that in the past, Ghana’s fiscal practice is to include all exceptional cost, and I hope that the mid-year review will go back to that. The government must reconcile its own position with the fund, as it’s important for its own fiscal credibility”.

“Doing this, for us, will mean the government’s admission of adjustment to performance in the past, which was shown as stellar. But it’s fair to Ghanaians, and, especially, when you accuse other administrations of poor performance.”

At the end of March 2020, Mr Ofori-Atta said the total estimated fiscal impact, as a result of the coronavirus pandemic, was GHS9.5 billion (2.5% of revised GDP). 

This was to be from the shortfall in petroleum receipts, the shortfall in import duties, the shortfall in other tax revenues, the cost of the preparedness plan, and the cost of Coronavirus Alleviation Programme.

A recalibration of the 2020 Fiscal Framework underpinning the approved 2020 Budget to reflect the fiscal impact of the coronavirus, without incorporating measures, showed that the overall fiscal deficit will increase from the programmed GHS18.9 billion (4.7% of GDP) to GHS30.2 billion (7.8% of revised GDP).

Also, the primary balance will correspondingly worsen from a surplus of GH?2.811 billion (0.7% of GDP) to a deficit of GHS5.6 billion (1.4% of GDP).

According to Mr Ofori-Atta, measures were, therefore, required to close the fiscal gap of GHS11.4 billion (2.9% of revised GDP).

“Since we are faced with extraordinary circumstances which require extraordinary measures, we would like to propose the following measures for the consideration and support of the House”, Mr Ofori-Atta revealed.

The measures included lowering the cap on the Ghana Stabilisation Fund (GSF) from the current US$300 million to US$100 million in accordance with Section 23 (3) of the Petroleum Revenue Management Act (PRMA). 

This measure, he believed, will enable the excess amount in the GSF account over the US$100 million cap to be transferred into the Contingency Fund, consistent with Section 23 (4) of the PRMA.

The amount transferred into the Contingency Fund will be used to fund the Coronavirus Alleviation Programme (CAP). Through this process, an estimated GHS1.250 billion will be transferred into the Contingency Fund to Fund the CAP. 

Others were an arrangement with the Bank of Ghana to defer interest payments on non-marketable instruments estimated at GHS1.22 billion to 2022 and beyond, as well as adjusting expenditures on Goods & Services and Capex downwards by GHS1.248 billion, securing the World Bank DPO of GHS1.71 million and obtaining the IMF Rapid Credit Facility of GHS3.145 billion.

Meanwhile, the COVID-19 National Trust Fund Managers have disclosed that GHS32 million has, so far, been spent on the procurement of Personal Protective Equipment (PPE) and other supplies.

The government set up the COVID-19 Trust Fund to solicit funds to help deal with the impact of the deadly virus in the country.

Retired Chief Justice Sophia Akuffo was nominated as Chairperson of the Board with eight other board members.

The other members of the board are Archbishop Justice Akrofi, former Anglican Bishop of Accra and former Archbishop of the Church of the Province of West Africa; Mr Jude Kofi Bucknor, Mrs Gifty Afenyi Dadzie, Else Addo Awadzi; Deputy Governor of the Bank of Ghana, Dr Ernest Ofori Sarpong; Chief Executive Officer of the Special Ice Group of Companies, Dr Abdul-Sameed Tanko, and Dr Collins Asare, who also serves as the Secretary to the Board.

The GHS32 million spent on the procurement of PPE was out of a total of GHS53 million donated to the fund.

Speaking at a ceremony to donate some medical equipment and PPE to various treatment centres across the country, the Chairperson for the Trust fund noted that the fund still needs more PPE and vehicles.

Justice Akuffo (rtd) said: “To date, the Trust Fund has spent approximately GHS 32,581,233.90 out of the total amount of 53 million cedis received so far. We need vehicles for care and testing centres, PPE including more veronica buckets and touch-free sanitizer dispensers.”