Our fiscal performance for 2019 was good - Ofori-Atta

Accra, Nov 13, GNA - Mr Ken Ofori-Atta, the Minister of Finance says the government remains committed to safeguarding the macro-fiscal gains that was achieved over the last three years in the management of the nation’s public finances.

He said the implementation of the Fiscal Responsibility Act, the establishment and operationalisation of the Fiscal Responsibility Advisory and Financial Stability Councils, had complemented several other institutional and structural reforms to strengthen fiscal discipline and ensured irreversibility of policies.

Mr Ofori-Atta who was presenting the 2020 budget said over the first nine months of the 2019 fiscal year, provisional fiscal data indicated that the fiscal deficit arising from Government’s fiscal operations was 4.5 per cent of Growth Domestic Product (GDP) on cash basis.

“This compares to a deficit target of 4.1 per cent of GDP for the period. The higher-than- programmed fiscal deficit resulted mainly from revenue underperformance,” he noted.

“Although expenditures were also below target, the expenditure execution rate was higher than revenue execution rate”.

Mr Ofori-Atta stated that the total Revenue and Grants for the period, amounted to GH¢36.3 billion representing 10.5 per cent of GDP.

He explained that the outturn represented a per annum growth of 9.2 percent despite a 13.6 per cent shortfall relative to the target of GH¢42.0 billion representing 12.1 per cent of GDP.

The Minister said the general underperformance of tax revenue mainly stemmed from shortfalls in International Trade taxes and on Income and Property taxes.

He stated that the shortfall in international trade taxes, which consisted of Import Duty and Levies, External VAT, and Customs National Health and GETFund levies, resulted from lower import volumes, high admittance of imported goods into the zero-rated and/or tax-exempt import brackets and the lower tariff bands, up to the 10 per cent tariff levels.

Mr Ofori-Atta said the total expenditure including; arrears clearance amounted to GH¢51.9 billion representing 15.1 per cent of GDP compared to the target of GH¢56.1 billion representing 16.2 per cent of GDP.

He said except for Interest Payments, all expenditure line items were contained within their respective targets.

Mr Ofori-Atta noted that following the government’s fiscal operations, the overall fiscal balance on cash basis resulted in a deficit of GH¢15.7 billion against the target of GH¢14.2 billion.

“The higher-than-programmed financing stems mainly from the frontloading of financing requirements to meet Government expenditures and other debt service obligations, including; for the settlement of uncovered Government auctions following substantial revenue shortfalls,” he said.

The Minister noted that the Primary Balance for the period was a deficit of GH¢916 million against the targeted Primary Surplus of GH¢201.7 million.

GNA

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