Policy measures in 2025 budget will increase cost of living - Kojo Oppong Nkrumah
He says the policies will increase the burden of the average Ghanaian.
Explaining the functions of the newly formed Parliament’s Committee of Economy and Development, of which he is a ranking member, Mr Oppong Nkrumah said among other things that “The budget committee was responsible for ensuring that the appropriations bill was tidied up and reported to the floor, and all of us helped to get it passed.
“The budget committee will be responsible for ensuring that the releases are done in accordance with the estimates that were set out in the Appropriations Bill, not exceeding those amounts. If you want to spend in excess, you need to come up with a supplementary budget by the middle of the year so they will be doing the day-to-day monitoring of how the budget is being implemented.”
“What our committee will be doing now is observing how all of that comes into effect on the economy, so for the various measures in the economic policy documents, we are looking at how it affects the economy and drawing the government’s attention to it.
“One of the things we have been drawing attention to is the cost of living. If you look at the economic policy measures that were rolled out cost of living is going to go up, and it is going to have a burden on the average Ghanaians,” he told Joy News.
The Ministry of Finance has announced the passage of the Public Financial Management (Amendment) Act, 2025, a landmark legislation aimed at bolstering fiscal discipline, accountability, and ensuring long-term economic stability in Ghana.
This comprehensive reform introduces stricter oversight mechanisms, enforces rigorous fiscal responsibility rules, and establishes an independent Fiscal Council to enhance transparency and compliance.
Key Reforms Introduced by the PFM (Amendment) Act, 2025:
1. Enhanced Sanctions for Fiscal Mismanagement:
• The Minister of Finance faces censure under Article 82 of the Constitution for any breaches of fiscal rules.
• Ministers of State and Heads of Covered Entities are subject to potential imprisonment for actions contributing to fiscal slippages.
2. New Fiscal Responsibility Measures:
• Implementation of a primary balance rule mandating an annual surplus of at least 1.5% of GDP on a commitment basis.
• Establishment of a public debt ceiling, capping the debt-to-GDP ratio at 45% by 2034 to ensure debt sustainability.
3. Creation of an Independent Fiscal Council:
• A legislated, autonomous Fiscal Council tasked with monitoring adherence to fiscal responsibility rules, thereby ensuring budget credibility and macroeconomic stability.
4. Strengthened Oversight and Accountability:
• Requirement for the Minister of Finance to obtain Parliamentary or Cabinet approval before suspending fiscal rules due to force majeure or unforeseen economic conditions.
5. Consolidation of Fiscal Management Laws:
• Unification of all fiscal rules under a single legal framework, eliminating redundancies and enhancing enforcement mechanisms.
With the enactment of this law, the Fiscal Responsibility Act, 2018 (Act 982) has been repealed, and the Presidential Fiscal Advisory Council dissolved, streamlining oversight under the newly established independent Fiscal Council.
“The passage of these critical reforms, well ahead of the September 2025 deadline for the IMF-supported program, demonstrates the Ministry of Finance’s unwavering commitment to restoring fiscal discipline, enhancing transparency, and securing Ghana’s long-term economic resilience.
“The Ministry said it remains dedicated to ensuring full implementation of these laws and will collaborate closely with all stakeholders to uphold Ghana’s macroeconomic stability and prosperity,” the Ministry said in a statement.
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