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Parliament has granted a request tabled before it by President John Dramani Mahama through his Finance Minister, Seth Terkper, to withdraw and spend an amount of GH₵10,999,108,191 from the Consolidated Fund for the first quarter of 2017 pending the approval of an Appropriation Act for 2017 financial year.

The amount, according to the Legislature, is to enable the government to finance critical expenditure during the stipulated three months period, thus from January to March.

During the same period, the government is projected to raise or collect total revenue of GH₵8,988,080,585 from tax and non-tax revenue sources.

The amount is to be spent on compensation of employee, goods and service, capital expenditure, interest payment, grants to other government units, non-road arrears, tax refunds and amortization.

An amount of GH₵3,881,345,637 is expected to be spent on compensation of employees while GH₵164,220,432 is also expected to be spent on goods and services during the stipulated period.

In the capital expenditure category, an amount of GH₵1,251,883,521 is expected to be sent while GH₵1,889,870,741 is expected to be spent on interest payment.

Furthermore, an amount of GH₵2,368,676,114 would be spent on Grants to other government units, with GH₵518,456,296 estimated to be spent on Non-Road arrears.

An amount of GH₵151,078,450 and GH₵773,577,000 are expected to be spent on tax refunds and amortization during the stipulated period respectively.

The revenue to be generated during the stipulated period is expected to come from various sources including; Tax on income and property (GH₵1,392,910,558), Taxes on domestic goods & services (GH₵3,038,826,289), International trade taxes (GH₵1,206,418,752), Social Security contributions (GH₵60,720,080), Non tax revenue (GH₵1,184,885,143), and Grants (GH₵444,000,000).

The deficit in financing the three months period, according to the report of the Finance Committee on Expenditure in advance of Appropriation, will be through both domestic borrowing and external financing including project and program loans.

Background

Pursuant to Article 180 of the 1992 Constitution of the Republic of Ghana, the Minister of Finance acting through the authority of the President, requested Parliament to approve an Expenditure in Advance of Appropriation for the period January 1 to March 31, 2017, to authorize the withdrawal of monies from the Consolidated Fund and other public funds to support the running of the State for the first quarter of the 2017 financial year.

This request is as a result of the non passage of Appropriation Act for 2017 Budget Statement and Economic Policy. This is due to the 2016 Presidential and Parliamentary elections.

Article 180 of the 1992 Constitutions states that “Where it appears to the President that the Appropriation Act in respect of any financial year will not come into operation by the beginning of that financial year, he may, with the prior approval of Parliament by a resolution, authorize the withdrawal of moneys from the Consolidated Fund for the purpose of meeting expenditure necessary to carry on the services of Government in respect of the period expiring three months from the beginning of the financial year or on the coming into operation of the Act whichever is earlier.”