Government seeks approval for supplementary budget

Accra, July 12, GNA - Mr Kwadwo Baah-Wiredu, Minister of Finance on Thursday presented a supplementary budget to Parliament requesting an additional A24,280.3 billion being grants, loans and taxes already collected.

The monies are coming from Ghana development partners, including the World Bank, International Monetary Fund, Millennium Challenge Account and the African Development Bank.

Mr Baah-Wiredu said the Government was also seeking Parliaments approval of A227.4 billion, which had accumulated from an earlier period when an announcement in the adjustment of petroleum prices was made prior to Parliamentary approval in February 2005.

"This is also available for use as part of the additional revenue," he said.

He noted that when the Budget Statement and Economic Policies of Government was submitted in November 2005, "I signalled Government's intention to take advantage of the additional resources expected to be released through the Multilateral Debt Relief Initiative to enhance the realization of our development objectives, primarily through augmenting current levels of public investments and providing for further poverty reduction.

"We have received information of the amount of relief available this year, and we are, therefore, pleased to submit for the approval of this House, supplementary estimate for the use of these additional resources."

Mr Baah Wiredu said the IMF had deposited 200 million dollars in Government Accounts at the Bank of Ghana, indicating that relief expected from the World Bank and the AfDB, would be made available in the third quarter of 2006.

He said a grant amount of 182.9 billion dollars (20 million dollars) is projected to be received from the Areeba Telephone Company to be used to finance the construction of the Accra East-West Water Loop. "For the rest of the year, government expects to contract short term and long term loans to the tune of equivalent of A21,317.02 billion (144 million dollars) to support various projects."

He said A2859.7 billion was expected to be contracted from local sources as Short-term loans while the balance of A2457.3 billion was a concessionary long-term loan expected to be contracted from the Deutsche Bank.

Additionally, he said, discussions were advanced with regards to the loan negotiations and that the Government would be coming back to Parliament very soon to seek approval for the loans. The Finance and Economic Planning Minister said the Government recognized the vital role of the capital market as a key instrument for resource mobilization for the private sector.

"A complementary activity in this regard is the deepening of the activities of the Ghana Stock Exchange," he noted, and stressed that the Government would continue its policy of off-loading its shares in various companies on the Ghana Stock Exchange.

"Specifically Government intends to raise A2338.4 billion from the offloading of its shareholding in State Insurance Company (SIC); Ghana Oil Company (GOIL) and Produce Buying Company (PBC) on the Ghana Stock Exchange.

"A twin objective is to both encourage the public at large to partake in the process of wealth creation and also raise additional resources to finance the supplementary estimates."

On payments, Mr Baah-Wiredu said the Government was requesting approval for a total of A24,280.3 billion as supplementary expenditures for various programmes and activities of Ministries Departments and Agencies (MDAs) not accounted for under the Budget presented in November 2005.

"The proposed expenditures are grouped under three thematic areas of the Growth and Poverty Reduction Strategy (GPRS) II: Good Governance and Civic Responsibility; Private Sector Competitiveness; and Human Resource Development.

Mr Baah Wiredu said in this fiscal year, Ghana expected to receive debt relief from the Multi Donor Relief International (MDRI), consisting of A21,829.2 billion (200 million dollars) from the IMF; equivalent of =A2219.5 billion (24 million dollars) from the World Bank and about =A254.9 billion (6 million dollars) from the African Development Bank Group.