Thank you, Madam Speaker, for this opportunity to contribute to this Motion seeking approval for the Financial Policy and Budget for the year 2011. Madam Speaker, since l997, of having been in Parliament, I have not seen any budget debate which has lacked steam like the debate on the 2011 Budget.
Madam Speaker, the tone for the rather boring spectacle was set on the day of the Budget presentation when many Hon Members slept through the presentation. [Interruptions.] Madam Speaker, I am reminded by my Hon Colleague that Members of Parliament do not sleep in the Chamber; they meditate, so many of them were caught meditating - [Laughter] - during the presentation by the Hon Minister.
Madam Speaker, the Hon Majority Leader himself did not know when the Minister finished with his presentation. [Laughter] Obviously, the Hon Majority Leader had caught the bug, the bug of panic carnage and fear induced by the Budget for 2011. Madam Speaker, as for the Hon Minister, whose duty it was to carry the doomsday message, the message of panic and fear, he was so confused and so jittery that once again, he could not even spell the name of the President correctly.
Madam Speaker, you will recall that in 2009, the Budget that was presented to Parliament, the name of the President was spelt “Professor John Evans Atta-Mills”, that was 2009; it came with a hyphen. In 2010, it came without a hyphen; 2011, another “Atta-Mills” will have a hyphen;. What is the actual name of the President and how is it spelt? [Interruptions.] Madam Speaker, clearly, it is symptomatic of the confusion that has afflicted this Government and, by extension, the Budget.
Madam Speaker, my Hon Colleagues have spoken at length and they have established that the 2011 Budget is one that is very economical with disclosures.
Madam Speaker, on page 5 of the Budget Statement, the Hon Minister started with a chest-beating declaration that, “we have made significant progress.” Madam Speaker, what are they? They cite a GDP growth of 4.1 per cent in 2009 and 5.9 per cent provisionally in 2010 against the target of 6.5 per cent. Both, Madam Speaker, are far lower than the 7.3 per cent growth registered in 2008.
So, which regime, Madam Speaker, are better managers of the economy? [Interruptions.] Whereas the fiscal terrain in 2008 suffered bumps and hiccups, no thanks to the financial meltdown, the world food crisis, the collapse of banks, reduction in remittances, the dwindling water levels in Akosombo Dam, unprecedented soaring petrol prices, et cetera, today, this year, we have had very good rains. Cocoa and gold prices have hit record heights and yet the growth in the economy is far lower in 2010 than in 2008.
Madam Speaker, average inflation in 2009 climbed down to 9.0 per cent in Africa; and in 2010, it is projected to fall further to 6.5 per cent and the Hon Minister knows that. He himself told us this in the 2010 Budget, that inflation for Africa is supposed to hit a low of 6.5 per cent. In the event, if we registered
9.3 per cent, Madam Speaker, clearly, Ghana, positioning itself as the gateway to Africa, certainly, went off the mark and we should not be beating our chest and be raising our shoulders as if we have done the unimaginable.
Madam Speaker, clearly and bluntly put, we have failed. The question arises; if the fall in inflation is not matched commensurately by significant decreases in interest rates, then clearly, there is something basically wrong with our macroeconomic management.
Madam Speaker, we are told that the
fiscal deficit reduction was from 14.5 per cent on cash basis at the end of 2008 and it reduced to about 9.7 per cent in 2009. The overall budget deficit of 7.5 per cent of GDP, gross international reserves of about 3.2 months of import cover as at the end of October, 2010 -- Madam Speaker, it is significant to observe that the Hon Minister agrees that by the end of December, 2010, only two months' import cover will be what the nation will be confronted with.
Madam Speaker, he tells us that at the end of October - and it is on page 6 of the Budget document, the cover was for 3.2 months. In December, it is supposed to come down to 2.5 months. That explains it. And the Hon Deputy Minister is bewildered; he should look at their own Budget document; they have provided it in their own Budget document; that by December, it is supposed to be 2.5 months. The question to ask, again, is, why?
Madam Speaker, it is a fact known to all prying eyes that Government is not spending, and so to talk about fiscal deficit reduction with all budget deficit climb- down and the buildup in these international reserves are all artificial. It is, indeed, a hoax! Madam Speaker, the NDC, we all know is not spendng money. The NDC would not want to own up to this
but what are the facts? Paragraph 71 of the 2009 Budget states, and I quote, with your permission, what the Hon Minister told us:
“Madam Speaker, total payment for 2008 comprising discretionary and statutory payments amounted to GH¢9,538.2 million.”
It is significantly higher than the budget estimates of GH¢7,107.2 million.
Now, in paragraph 48 of the 2011 Budget, we are provided with the following statement:
“Total expenditure for 2009 fiscal year amounted to GH¢9,0744 million, equivalent to 41.7 per cent of GDP.”
This, indeed, is less by the expenditure of 2008 by over GH¢400 million. Madam Speaker, now, let us consider from paragraphs 80 to 91. For whatever reason, the Hon Minister did not composite total expenditures in any of the paragraphs for fiscal year 2010. The table on page 30, however, indicates that for the first nine months, total expenditure including arrears clearance and tax refunds amounted to GH¢8,494 million equivalent to 32.8 per cent of GDP. That outturn already is higher than the Budget target of GH¢7,863.6 million.
Madam Speaker, what, is abundantly clear is that Government's spending over the past two years has been lower than what the NPP spent in 2008. [Interruptions.] Madam Speaker, if inflation is factored into the question, the spending amount may appear far lower. If we factor in inflation, we would have to increase spending in order to do the same things that we were doing in 2008. But of course, this is a Government which is tagged a “do little government.”