The Director of the Institute of Statistical, Social and Economic Research (ISSER) of the University of Ghana, Prof. Felix Asante has urged the government to remain firm and resist any election pressures to spend out of budget. 

He says budget overruns particularly in election years have always had dire implications for the macro-economic environment and even though the trend has persisted since the advent of the 4th Republic, the time to buck it is now.

Prof. Asante was speaking at Tuesday’s Graphic Business/Stanbic Bank Breakfast Meeting in Accra on the theme: “Election Year Budget Deficit: Implications for Macro-Economic Stability.”

“It’s very important that the government remains firm in its commitment and not to be carried away by the pressure to spend. The 2012 experience offers the most recent example. Hopefully the passage of the public financial management (Act) will offer some respite to the managers of public finances from political pressure to spend,” he said.

Prof. Asante also called on the government and entire populace to appreciate and spread development projects beyond election years, so that incumbent governments do not tie needed development projects to electoral fortunes and rollout one project commissioning after another with the attendant sets of payments most of which he said may be unplanned but have implications for the economy.

“This attitude of only seeing development “in the year of election” is something that as a country we should move away from”, he said, explaining that that attitude hurts the economy.

Prof Asante pointed that Ghana’s recent history has shown that electoral cycles generally coincide with a reversal of fiscal consolidation efforts where fiscal outcomes are compromised in election years and there is always the pressure to spend.

“Economic actors suffer severely in the short to medium term if there are unexpected and sudden shocks to the economy resulting from fiscal indiscipline by the biggest spender in the economy which is the government of the day. The concerns in recent years is government’s unplanned expenditures leading to budget overturns and high deficits election years.”

Source: graphic.com