Economy still in tact despite payment of new salaries and arrears

Accra, June 21, GNA - The payment of new salaries to doctors and health workers would not affect the national budget since it falls within the scope of contingencies laid down by Government.

Mr Kwadwo Baah-Wiredu, who was addressing the press at the close of the 13th Consultative Group/Annual Partnership Meeting in Accra, said initially the Government had made available 1.7 trillion cedis as personal emoluments in the budget, excluding the Additional Duty Hours Allowance (ADHA).

The Group Meeting is expected to commit disbursements totalling 1.3 billion dollars to Ghana in 2006 from a total of 6.3 billion dollars to be released under the Growth and Poverty Reduction Strategy II GPRS II)programme.

"However, considering the recent demands by doctors and other health workers, we had to move 700 billion cedis out of the 749 billion cedis earmarked as contingency to top up funds made available to the Ministry of Health to 2.4 trillion cedis," Mr Baah-Wiredu said.

Mr Baah-Wiredu said personal emolument in the 2006 budget was approximately 10 trillion cedis and with the payment of the arrears, Government was keen on meeting the needs of the country as per the budget presented.

He explained that the Government of Ghana was funding these expenditures. On the other hand donors are providing 6.251 trillion cedis while revenue agencies were to support with internally generated funds.

On the impact that the expected payment to the Teachers and Educational Workers Union (TEWU), the Minister said the Government financing was still inline with the budget.

In an interview with the Ghana News Agency later, the Finance and Economic Planning Minister said the extra payments and the arrears all fall within the budgeted 20 per cent earmarked, "it means that the Government on its own was already prepared to take care of such a situation".

'What we should all know is that we have a nation to build and we have to move up in the way we do our things', he said.

He called for a significant increase in revenue collection, saying; "if we do that and increase payment of salaries to workers, no one would begrudge us. But we must know that no donor would give you money to pay salaries."

Government is targeting to raise 26 trillion cedis, with about 14 trillion cedis going into wages, salaries, pensions, social security and gratuity.

He said the Government was keeping track with her development partners to ensure that all key sectors of the economy including road and transport, education, health, agriculture and decentralization process were developed to appreciable levels.

Mr Mats Karlsson, Country Director of the World Bank, said Ghana had an enviable track record and with the increased levels of donor inflows, coupled with the effort of Government, the country was capable of making it into the middle-income status.