Govt targets in 2014 Budget unambitious - IEA

The Institute of Economic Affairs has described as unambitious some key macroeconomic targets set by government for next year.

The IEA is not impressed with the inflation target of 9.5 percent plus or minus 2 and the budget deficit of 8.5 percent of GDP.

Senior Economist with the IEA, Dr. John Kwakye said the inflation target breaches the sub-regional convergence criteria of 5 percent.

Reviewing the 2014 budget statement, Dr. Kwakye said the budget deficit will encourage borrowing and increase the public debt.

IEA also indicted Parliament over its failure to check the executive’s spending over the years.

The institute described this as a "weak oversight" which shouldn’t be allowed to happen adding that Parliament can’t escape blame when the country runs into huge deficits.

Addressing the media on the 2014 budget statement Dr. J.K Kwakye said parliament must set up a non-partisan parliamentary budget office to properly check government's spending.

Dr Kwakye also kicked against the 2.5 percent increase in the Value Added Tax saying Ghanaians are already overburdened with taxes.

“I am never in favour of increasing the existing tax rates in other words asking us to pay more taxes when we are already overburdened”.