Government ‘scheming’ to sell SOEs to fund 2018 budget

The Member of Parliament for Bolga Central, Mr Albert Adongo, has accused the government of ‘scheming’ to sell state enterprises (SOEs) as a major source of revenue to fund its 2018 budget.

He said the recent focus of the Vice-President and the Minister of Finance on SOEs was part of a grand scheme of the government to scale up divestiture proceeds as a major source of revenue to fund the budget, having failed to find innovative ways to improve revenue generation.

“The continuous under performance of government revenue generation measures from the 1st quarter to the 3rd quarter of the year is becoming a major worry for the International Monetary Fund (IMF) with desire consequences for expenditure cuts that is beginning to hurt economic growth,” he said in an interview with the GRAPHIC BUSINESS.

He said the country's growth under this government had been heavily reliant on oil led industrial growth with the services sector suffering from acute cuts in government spending.

“In the 2017 budget, an amount of GH¢1.8 billion was to be generated from the sale of national assets in the face of a drop of capital expenditure from 4.5 per cent of GDP in 2016 to four per cent. Technically, whilst the government has reduced capital spending in critical sectors of the economy such as health, education, roads and energy, the government has also embarked on the sale of assets it inherited to fund consumption expenditure,” he indicated.

“The signs are clear that the government is now looking to privatise state own enterprises to fund its budget. The recent use of civil societies as pseudo neutrals to push this agenda is worrying. It is strange that the same government is burdening these SOEs with appointment of several unnecessary deputy director generals meant for the boys at the neglect of instituting measures to improve them, he added.

He said the 2018 budget would tell how creative this government is in raising revenue.

“Sale of national assets to fund the budget to consolidate the fiscal environment is never the way to go. What next after we have sold all our national assets for consumption?” he asked.

Poor economic management

Mr Adongo also pointed out that “it was very strange that the government had failed woefully to implement its economic models around enhanced revenue generation, increased capital expenditure and a reduction in government borrowing.

He said public debts increased by a hooping GH¢17 billion in just six months of this government.

“Capital expenditure is expected to drop further from the low budget of four per cent of GDP by the close of the year with the largely capital driven budget of GH¢1 billion at the office of the President for one-village one-dam, one-district one-factory, sanitation and water for all and GH¢200 million Zongo Development fund in limbo in 2017,” he noted.

“The government has simply failed to find the money as budgeted and therefore decided to delay the legislation for the establishment of the Development authorities and Zongo Development Fund to find an excuse for not delivering on its promise to the people of Ghana in 2017 as budgeted,” he added. — GB