Gov’t To Save The Public Purse With GHc3.5 Billion From Salary Cut

Government has given approval for Ministers and Heads of State Owned Enterprises (SOEs) to contribute 30 percent of their salaries from April to December 2022 to the Consolidated Fund.

The decision is expected to save the public purse GHc3.5 billion as an exemplary leadership to cushion the economy in the midst of global economic difficulties.

Mr Ofori-Atta announced this at a media conference in Accra, on Thursday, as part of austerity measures to easing current economic challenges in the country.

The interventions are expected to help meet the 2022 7.4 per cent fiscal deficit target.

The Minister lauded members of the Council of State for cutting 20 per cent of their monthly allowances to complement the Government’s policy.

He, however, said the salary cuts would not affect over 700,000 civil servants and members of Parliament.

Mr Ofori-Atta announced 13 new interventions, including reduction in petrol and diesel margins, 50 percent cut in fuel coupon allocations for all political appointees, and heads of institutions, including SOEs effective April 1, 2022.

Government, he said, would inject US$2 billion through external financial arrangements in the next two to six weeks to cushion the economy due to global economic meltdown occasioned by the COVID-19 pandemic, fuel hikes and Russia-Ukraine war.

He explained further that as part of the new measures to ensure prudent use of the state limited resources, government would “prioritise ongoing public projects over new projects.”

Mr Ofori-Atta noted that the decision to prioritise ongoing public projects over new projects would enhance the efficient use of limited public funds by finishing ongoing or stalled ones.

The Minister was emphatic that government would not roll back on gains made under the Free Senior High School Policy, noting that it would review the rest of the priority flagship programmes to ensure efficiency.

The country has witnessed fuel price hikes by 57 percent cumulatively since the beginning of the year, thus affecting transport fares and cost of goods and services while the Cedi has depreciated by 15.6 percent to the US dollar.

The Ghana Statistical Service said the country’s  year-on-year inflation hit 15.7 percent in February, thus eroding the purchasing power of most Ghanaians.

Government, through it spokesperson Kojo Oppong Nkrumah, after a three-day crunch Cabinet meeting at Peduase Lodge last weekend said government would review 16 priority flagship programmes to save money and cushion the economy.

Some the strategic policies include the Free Senior High School Policy,  Planting for Food and Jobs, Planting for Export and Rural Development, One-District,One-Factory, One-Village, One-Dam and Natural Builders Corps, which are strategic interventions to enhance  economic growth, improve food security, drive job creation and improve the living conditions of Ghanaians.

However, Mr Oppong Nkrumah stated that the new interventions or budget cuts would be done within the fiscal framework of what the government was working with.