Parliament suspends fiscal responsibility law for 2020

This is due to the high expenditure of government due to the COVID-19 pandemic that has ravaged the world.

This was proposed by the Minister of Finance, Ken Ofori Atta during the presentation of his mid year budget review.

Among the circumstances leading to the suspension of the set fiscal rules for 2020, were the creation of uncertainty and weakened economic growth, significant decline in remittances, and massive capital flight from low income countries.

Service operators and household businesses had equally been hard hit with significant job losses and reduced incomes and government revenues had considerably declined while expenditures were rising.

Chairman of Parliament’s Finance Committee, Dr. Assibey Yeboah ece-auto-gen

The report, presented to the plenary by Dr Mark Assibey-Yeboah, Chairman , Finance Committee, noted that the Act enjoined the Government of Ghana to ensure that the overall fiscal balance on cash basis for a particular year shall not exceed a deficit of five per cent of the GDP for that year, and maintain an annual positive primary balance.

“The scale of the damage and macroeconomic distortions caused by the pandemic is unprecedented in the country’s history. The Minister had no option than to suspend the fiscal rules and targets for the 202 fiscal year, “the report said.