Parliament approves 2007
Budget
Accra, Dec. 4, GNA-Parliament on Monday approved
the Financial Policy of the Government for the
2007 fiscal year, read by Finance and Economic
Minister on November 16, 2006.
The approval followed days of extensive debate
on both Majority and Minority sides of the House
on the budget which the Majority had called the
Jubilee budget, but which the Minority rather
called Awam (fake) Budget.
Mr Alban Bagbin, Minority Leader in Parliament,
presenting a summary of the views of the
Minority said the Minority had noted 32
inconsistencies in the data of the 2007 Budget.
He said there was no vision document to realize
the development programmes outlined in the
budget, and wanted to know who approved an
amount of 600 billion cedis spent on utilities.
Mr. Bagbin described the Budget statement as a
mere ritual of rhetoric, adding that proposed
re-denomination of the cedi next July should
have been captured in the 2007 Budget.
The Minority Leader said the figures for the
"Golden Jubilee" Budget were rather low and
called for the development of long-term vision
for the nation.
Making an intervention, Mr. Felix Owusu-Agyapong,
Majority Leader and Minister of Parliamentary
Affairs, said the timing for the budget was
right, and the new changes introduced into the
Budget made it a good budget.
He said the problem was the shortage in receipts
for the various sectors,
Mr. Owusu-Agyapong called on the fellow
legislators and Ghanaians to believe in
themselves and empower the various parliamentary
committees to work to achieve the programmes
outlined in the Budget.
Below are some highlights of the Budget:
Headline inflation declined to 10.5 per cent at
the end of the October 2006 from 14.8 per cent
at the end of December 2005.
Gross Domestic Product (GDP) growth rate
projected at 6.2 per cent based on data through
September 2006.
Interest rates generally declined over the ninth
month period to September 2006 but the main
policy rate, the Bank of Ghana Prime Rate
remained unchanged at 14.5 per cent since
January 2006 when it was reduced by 1.0
percentage point to the current level.
The Cedi depreciated by 9.5 per cent against the
British pound and 7.8 percent against the Euro,
while a moderate depreciation of 09 per cent was
recorded against the US dollar.
Provisional estimates of the Balance of Payments
(BOP) recorded a modest surplus of 77.7 million
dollars compared to a deficit of 195.8 million
dollars in the same period of 2005.
Overall fiscal deficit reduced from 6.7 per cent
of GDP in 2003 to 2.3 percent of GDP in 2005.
Provisional fiscal out-turn for January to
September 2006 shows total receipts of 31,292.7
billion cedis as against the out-turn of
23,723.7 billion cedis registered for the same
period during 2005.
Provisional out-turn for total payments for the
first three quarters of 2006, comprising
statutory and discretionary payments was
31,929.7 billion cedis as against 23,723.7
billion cedis for the corresponding period 2005.
Ghana's total medium debt and long term external
debt at the end of 2005 stood at 6,347.9 million
dollars. This amount had been reduced
significantly to 2,143.79 million dollars by the
end of September 2006 as a result of a 66 per
cent debt reduction under the Multi-lateral
Debts relief initiative (MDRI).
The BoG accumulated a net international reserve
of 263.5 million dollars compared with 7.5
million dollars during the same year in 2005.
The agricultural sector is projected at 5.7 per
cent indicating a 0.9 percentage shortfall
against the target of 6.6 per cent.
Industrial growth is projected at 7.3 per cent
with electricity and water as the major
contributing sub-sectors.
In the mining sector, gold is projected to
register a growth of about 9.0 per cent.
The manufacturing sector growth is projected at
4.2 showing a slowdown from the 5.0 per cent
recorded in 2005.
The construction sector projected to grow at 8.2
per cent.
Credit to the private sector went up from 77.4
per cent a year ago to 81.6 per cent for the
year.
Employment went up by 12.5 per cent.
The establishment of a Fair Wage Commission to
administer the new Comprehensive Pay Structure.
GNA
