GRA, Finance Ministry Score High On IMANI Africa’s 2020 Fiscal Recklessness Index
- The Ghana Revenue Authority (GRA) and the Finance Ministry (and its agencies) have topped the list of public institutions that are most reckless in how they handle state finances
- The list was compiled by IMANI Centre for Policy and Education, a think tank, and released on Tuesday, May 31, 2022
- The list has been compiled into the Fiscal Recklessness Index and covers a five-year period between 2015 to 2020.
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Think tank IMANI Centre for Policy and Education has released its latest Fiscal Recklessness Index (FRI), showing the Ghana Revenue Authority (GRA) and the Finance Ministry wasted state money the most in five years.
The FRI measures the extent of fiscal discipline or otherwise of public institutions using the Auditor-General’s report.
The index covered the periods between 2015 to 2020 and found that notable public institutions wasted a total of GH¢13.9 billion in financial irregularities covering procurement, cash, tax, payroll, rent, and contract irregularities.
Source: UGC
According to IMANI, an analysis of fiscal indiscipline at Ministries, Departments and Agencies (MDAs) shows that tax and cash management have been the main sources of fiscal recklessness in the last five years.
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“Tax and cash irregularities constituted an average of 83% of the composite of financial irregularities. The financial irregularities over the period were largely driven by high tax irregularities (GH¢ 9.13 billion; 65.49%) caused by the failure of the Ghana Revenue Authority (GRA) to collect taxes due to the state and enforce compliance. Besides the tax irregularities, cash irregularities also constituted a significant proportion of the total financial irregularities.
A total of GH¢2.9 billion, representing about 21.4% of the total irregularities, was recorded between 2015 and 2020,” said IMANI in the report launched on May 31, 2022.
The report revealed further that the cash irregularities are largely driven by unapproved disbursement of funds, unapproved transfer of funds, and delays in the lodgement of public funds into the respective public accounts.
Other relatively smaller irregularities comprised debts, loans & advances (GH¢1.20 billion; 8.58%), contracts (GH¢387 million; 2.78%), stores/procurement (GH¢136 million; 0.98%); rent (GHS85 million; 0.61%) and payroll irregularities (GH¢14.6 million; 0.10%).
The Ministry of Finance (and subsidiary agencies) tops IMANI’s list of MDAs as the most fiscally reckless MDA on an annual basis and also over the six years between 2015 and 2020. For example, the Ministry of Finance had the highest combined Fiscal Recklessness Score (FRS) of 0.8797.
Two key irregularities account for the trend observed at the Finance Ministry, said IMANI, and they are:
- Tax irregularities, and
- Cash irregularities.
“For example, the Finance Ministry is responsible for 99.63% (GH¢9.10 billion) of the combined GH¢9.12 billion tax irregularities from 2015 to 2020. Likewise, the Finance Ministry accounted for 80.10% (GH¢2.35 billion) of the combined GH¢2.93 billion cash irregularities from 2015 to 2020 — this trend remains the same on a normalised data basis,” IMANI revealed.
Bank of Ghana: Dr Ernest Addison Announces Start of E-Cedi Piloting In Sefwi Asafo
Meanwhile, in a separate report, YEN.com.gh reported that the Bank of Ghana (BoG) has begun piloting the offline feature of the e-cedi in the Western North Region town of Sefwi Asafo.
Governor of the BoG, Dr Ernest Addison, said on Monday, May 30, 2022, that selected users in that community have been using the e-cedi for daily purchases of food, groceries, and drinks.
“The BoG will continue to work with these users to obtain the critical usage data that will inform the decision about the e-cedi’s future after the pilot."
Source: YEN.com.gh
