Debates of 2 Mar 2017

PRAYERS 10:15 a.m.


Mr Speaker 10:15 a.m.
Hon Members, we have in our midst this morning, the Vice President of the Republic of Ghana who is here in accordance with article 111 of the 1992 Constitution.
Order! Order!
Article 111 reads:
“The Vice-President, or a Minister or Deputy Minister who is not a member of Parliament, shall be entitled to participate in the proceedings of Parliament and shall be accorded all the privileges of a member of Parliament except that he is not entitled to vote or to hold an office of Parliament.”

H.E the Vice President, thank you very much for your presence.

Hon Members, Order! Order!

Mr Speaker 10:25 a.m.
Hon Members, Correction of the Votes and Proceedings and the Official Report.

Hon Members, the Votes and Proceedings of Wednesday, 1st March,

2017 --

page 1…23 --
Mr Speaker 10:25 a.m.
Hon Member, do you have any difficulty?
Mr Ntim 10:25 a.m.
Thank you, Mr Speaker.
Mr Speaker, the Committee on Health had a meeting yesterday which related to malaria control, but it has not been captured. So, I am entreating the Table Office to capture same.
The Votes and Proceedings of Wednesday, 1st March, 2017, as corrected are hereby adopted.
Mr Speaker 10:25 a.m.
Hon Members, we have the Official Report of Friday, 17th February,
Any correction?
Mr Benjamin K. Kpodo 10:25 a.m.
Mr Speaker, please, I have a correction at column 1500, paragraph 6, the second line. After ‘Ho District', the word ‘or' should have been inserted, so that the presentation would read as follows:
“It should not stop there: It should be either ‘Ho' Municipality or Ho District or Ho should be taken off because Klefe-Achatime is not part of Ho.”
So, they should insert ‘or' or “Ho” should be taken off.
Thank you, Mr Speaker.
Mr Speaker 10:25 a.m.
Thank you.
The Official Report of 17th February, 2017, as corrected is hereby adopted as the true record of proceedings.
Item numbered 4 of the Order Paper -- Hon Minister .
Hon Members, we shall soon conduct Business, but our distinguished visitors and the nation that is watching us would feel well served by their respectable Hon Members of Parliament. There should be order.
Hon Deputy Majority Leader?
Mr Speaker 10:25 a.m.
Order! Order!
Hon Majority Leader, you would help the Hon Minister for Finance to assume his appropriate place and proceed with his Statement.
Mr Osei Kyei-Mensah-Bonsu 10:25 a.m.
Mr Speaker, I believe you have already called for the consideration of item numbered 4 on the Order Paper which is the Motion. The Minister for Finance, being with us, I should believe the time is due for him to move that Motion -- [Interruption] -- I believe think if the Hon Member listened to me.
Mr Speaker, so, the time is due for the Motion to be moved by the Hon Minister for Finance.
MOTIONS 10:35 a.m.

Minister for Finance (Mr Ken Ofori- Atta) 10:35 a.m.
Mr Speaker, Hon Members of Parliament, I come in peace. On the authority of President Nana Addo Dankwa Akufo-Addo, I beg to move, that this Honourable House approves the Financial Policy of the Government of Ghana for the year ending 31st December, 2017.

This presentation is an abridged version of the 2017 Budget Statement and I would like to request the Hansard Department to capture the entire Budget Statement and Economic Policy.
Mr Speaker, I also submit before this august House, the following Reports 10:35 a.m.
the 2016 Annual Report on the Petroleum Funds, in accordance with section 48 of the Petroleum Revenue Management Act 2011, Act 815 as amended;
the 2016 Annual Debt Report, in accordance with section 72 of the Public Financial Management Act 2016, Act 921 and
the 2016 Energy Sector Levies Report, in accordance with section 6 of the Energy Sector Levies Act, 2015, Act 899.
Mr Speaker, let me first thank you and the House for approving my nomination as the Minister for Finance. My profound gratitude goes to both sides of the aisle; thanks for the dry run of three and a half hours. I pray that I would be left off sooner this time.
Mr Speaker 10:35 a.m.
Hon Members, Order!
Mr Ofori-Atta 10:35 a.m.
A nation with a manifested sniff for greatness, a nation with very high expectations for President Akufo-Addo's Government, and a nation that is 60 years old, remains a diamond in the rough, and therefore, needs more than a shine.

Mr Speaker, I accept this role with all the solemnity and reverence that it deserves.

Mr Speaker, I would like to assure this House, as I also did with the Finance Committee, that I would work with Hon Members with utmost candour and respect. You are first and foremost the legislate the representatives of our people, and I have been privileged to witness the sacrifices you made in 2016, and gone through to be here.

Mr Speaker 10:35 a.m.
Hon Members, Order! Order!
Mr Ofori-Atta 10:35 a.m.
I stand in the rather large shoes of a legacy of family members
such as Dr J. B. Danquah, Mr William Ofori-Atta, Hon Amoako Atta of the Convention People's Party (CPP), Dr Jones Ofori-Atta; my father, President Nana Addo Dan Akufo-Addo, and Hon Atta Akyea.
-- 10:35 a.m.

Mr Speaker 10:35 a.m.
Hon Members, I would conference with Leadership. I may have to suspend Sitting, and have a conference with Leadership, if we are not in the position to listen. If this continues, this is what we may have to do.
Mr Ofori-Atta 10:35 a.m.
Mr Speaker, I have --
Mr Speaker 10:35 a.m.
Hon Members, by our Standing Orders, our procedures and traditions in this Honourable House, this Honourable House would listen carefully, Hon Members should be seen to be making notes, and at the appropriate time, they would come out with all that they have to say.
Hon Members, there would be listening at this stage.
I thank you.
Mr Ofori-Atta 10:45 a.m.
Mr Speaker, I have been brought up because of these people to respect this House, and I would also like to honour my forebears.
Mr Speaker, finally, let me freely admit that this battle ahead is indeed, the Lord's and I humbly confess before this august House and the nation of my inability to accomplish this enormous task without the help and the leading of the Almighty. [Hear! Hear!] Through Jesus
Christ, we can resolve these challenges - - [Interruption.] -- and establish a righteous and just society for all.
Mr Speaker, nine days ago, the President presented the State of the Nation Address to this august House. His Address, in addition to presenting the state of the economy, also broadly outlined the vision and policy direction of the Government. A vision of hope, of jobs, of wealth creation, and a robust economy, that supports a thriving private sector.
Mr Speaker, with this Budget, I present to you the policies, strategies and actions we would undertake to deliver the President's vision.
Mr Speaker, let us acknowledge that we have inherited a challenged economy, in which we all are stakeholders. A considerable debt overhang and rising interest payments caused by excessive borrowing, expenditure overruns and accumulated arrears, caused by excessive sole sourcing, inflated costs of projects, lack of fiscal policies -- [Interruption] - - and weak commitment to controls.
Mr Speaker, revenue under perfor- mance caused by leakages, loop holes and tax exemptions, slowdown in economic growth; caused by energy challenges; and a lack of an enabling environment for the private sector; limited capital investments, among others, due to rigidities from earmarking of revenues, that severely limits the fiscal space and undermines the prioritisation of all Government policies, and an urgent need to collaborate with our workforce and build a shared partnership to enhance training and improve their productivity.
Mr Speaker, the country's debt stock has reached a level of approximately 73

per cent of Gross Domestic Product (GDP) as at the end of 2016, which is in excess of debt sustainability threshold of 70 per cent. This has resulted in high debt service cost, with interest payments alone taking up nearly 42 per cent of tax revenue. This, together with compen- sation of employees and statutory payments, is more than total domestic revenue, leaving no fiscal space for growth enhancing policies, programmes, and expenditures.

Mr Speaker, total expenditures at the end of December, 2016 stood at 30.3 per cent of GDP against a target of 26.4 per cent of GDP, with an outstanding stock of arrears of nearly GH¢7 billion. This is at variance with the performance criteria on the non-accumulation of arrears for the 2016 fiscal year, under the International Monetary Fund (IMF) Supported Extended Credit Facility Programme.

Mr Speaker, the rate of economic growth has slowed down in recent times, with 2016 growth estimated at 3.6 per cent, the lowest in over two decades. Of particular concern are the erratic performance of the agricultural sector and the continuing energy challenges which have negatively affected the industrial sector.

The effect of this is a struggling private sector and rising unemployment.
Mr Ofori-Atta 10:45 a.m.
Mr Speaker, while inflation and interest rates have recently been on the decline, we still have to fix the underlying micro economic fundamentals to ensure that this trend is sustainable.
Mr Speaker, the economic challenges we face require deliberate but urgent well thought out strategic steps and the backing and total support of the Ghanaian people. I am confident that we have the human resources, especially in this House and in our diaspora community, the experience, and most importantly, the resounding mantle of the people to guide and inspire us.

Mr Speaker, our goal is to build the most business-friendly and people- centred economy in Africa which will translate into job creation and prosperity for all Ghanaians. We will strike the right balance between fiscal consolidation and growth by making credible policy choices that will create the fiscal space to implement growth enhancing initiatives.

Mr Speaker, we intend to build a partnership with labour that will result in a social contract to make an era of peace in which we will mutually enhance the productivity of our workforce.

This commitment, however, is hampered by five constraints which we need to overcome: low revenue collection; expenditure overruns and corruption; high wage bills; rigidity of fiscal structure caused by heavy earmarking of tax revenue and high debt service payment. This Budget presents a proposal to

address these issues permanently, and I hope I can secure the support of this august House in this regard.

Revenue administration remains a challenge. To boost revenue streams, we will strengthen tax administration, reduce tax exemptions, pluck revenue loopholes and leakages and combat tax evasion especially at our ports. We will broaden the tax base while reducing and abolishing some taxes and levies.

The National Identification Scheme, a priority project of this Administration, which we intend to relaunch this year, will support our efforts to rope in the economically, active but undocumented citizens and the informal sector of the economy, thereby broadening the tax base and accelerating financial inclusion.

Mr Speaker, we would adhere to and maintain good economic governance principles of fiscal discipline, accountability and transparency. To reiterate what the President said, we will protect the public purse by guaranteeing value for money in all public transactions and exercise prudence and discipline in our fiscal management to deliver on the aspirations of the Ghanaian people.

Inefficiencies and waste in Government spending will not be tolerated and there will be strict enforcement of all relevant laws and regulations, especially the new Public Financial Management Act, 2016, Act 921.

Government will pursue an effective debt management strategy to ensure debt sustainability. We will also adopt global standards of risk and treasury management to ensure accountability in the use of state resources.

In addition, Mr Speaker, we will work to reduce the amount of Government

borrowing and the resulting crowding out of the private sector.

Mr Speaker, as an example, in the 2016 Budget Statement, the entire allocation for the Ministries of Roads and Highways, Trade, Industry and Innovation, Food and Agriculture, Water Resources, Works and Housing, Youth and Sports and the Ministry of Transport amounted to a total of GH¢2.2 billion.

Interest payments in 2016 alone of GH¢10.8 billion will be nearly five times what was allocated to these six key Ministries combined. This is how pernicious our debt stranglehold is.

Mr Speaker, the Budget will set the pace for job creation and accelerated growth by empowering the private sector. To accomplish this, we would shift the focus of economic management from taxation to production. This will reduce the cost of doing business and create a conducive climate for the services sector, investment and job creation.

In this regard, a number of taxes that impede growth will be reviewed and if necessary, abolished. Government will reverse the recent low growth trend by boosting agriculture and industrial productivity.

Mr Speaker, the 2017 Budget will set in motion the following key policy priority and flagship projects: establishment of the Infrastructure for Poverty Eradication Project (IPEP).

Under this project, every constituency in this House will be allocated the cedi equivalent of US$1 million to combat poverty -- [Hear! Hear!] -- and improve the lives of rural dwellers and deprived communities.

Implementation of the One District, One Factory programme by initiating a massive industrialisation campaign across the country which will equip and empower communities to use their local resources to manufacture products that are in high demand both locally and in the sub- region.

Zongo Development Fund

Mr Speaker, the establishment of the Zongo Development Fund is to support the provision of critical infrastructure and services; roll out of the National Identification Scheme to facilitate the efficient delivery of public and private services and help formalise the economy; roll out of free SHS -- [Hear! Hear!] -- to ensure equal opportunity for secondary education for all and the enhancement of human capital for the country; roll out of a national digital addressing system to provide unique addresses for all properties in Ghana and restoration of teachers and nursing training allowances -- [Hear! Hear!.]

Mr Speaker, in spite of the previous Government significantly missing the 2016 targets of the International Monetary Fund (IMF), I would want to assure fellow Ghanaians, investors and external stakeholders that, we are committed to continuing with the extended credit facility programme with the IMF.

We will, however, review some of the targets and structural reform benchmarks to accommodate our priorities of tax reliefs and other positive measures to boost the private sector.

Mr Speaker, the Akufo-Addo Govern- ment seeks to sow the seeds that will bear sufficient fruits to make this and future generations prosperous. This will be done by unleashing the creative abilities of Ghanaians, facilitate increased economic activity which will lead to the improvement in people's lives.
Mr Ofori-Atta 10:55 a.m.
Mr Speaker, there are exciting times ahead and there is every good reason to be optimistic that our country is ready to work again -- [Hear! Hear!]. Ghana is ready because the people are ready and in the New Patriotic Party (NPP), they have a Government that is ready. [Hear! Hear!]
Mr Speaker, our Government looks forward to a partnership of progress with our Hon Colleagues across the aisle. Mr Speaker, we must, as a nation, come together to confront our reality.
The President mentioned nine days ago that he was in a hurry. Mr Speaker, we must all be in a hurry; we must trigger a national sense of urgency to deal with our deficits. Its continual presence curtails our capacity to leverage our many opportunities and resources that we have as a nation.
Let me stress, Mr Speaker, that we cannot borrow our way out of these challenges. This will be tantamount to creating and sharing poverty which only leads to a loss of our fiscal sovereignty.

Mr Speaker, my presentation today would follow this outline. I would present a short brief on how the global economy performed in 2016, the medium term outlook, and the expected impact on the Ghanaian economy. This would be followed by the microeconomic performance for 2016 against the target sets.

I would then present the President's microeconomic targets for 2017 and the medium term targets. In addition, I would

briefly talk about some key sector deliverables in 2017 and then provide you with the key policy initiatives for 2017. I would finally conclude with highlights of key messages in the Budget Statement.

The Global Economic Performance

Mr Speaker, the global economy is expected to witness some improvement in growth in 2017 and the medium-term, after a lackluster performance in 2016 -- the January 2017 update of the IMF's World Economic Outlook (WEO) Project, a global growth of 3.1 per cent in 2016. This is expected to improve marginally to 3.4 per cent in 2017 and further to 3.6 per cent in 2018. The downside risk to the global outlook, according to WEO, includes increased restrictions on global trade and migration and its negative impact on productivity.

In addition, high cooperate debt declining profitability, weak balances and thin policy buffers in emerging market economies may lead to capital flow reversals and depreciation of the local currency.

Commodity prices

Mr Speaker, oil prices have picked up in recent weeks, resulting mainly from an agreement among major producing countries to reduce supply. Crude oil prices are expected to average US$55 per barrel in 2017, which is about 28 per cent increase over the 2016 levels.

Gold prices are expected to decline from an average of US$1,249.00 per fine ounce in 2016 to US$1,219.00 in 2017, due largely to an expected strengthening of the United States (US) Dollar. According to the commodity markets outlook of the World Bank, cocoa price is projected to average about US$2,940.00 per ton in


Implementation of ECOWAS Common External Tariff

Mr Speaker, Ghana joined nine other member states to implement the Economic Community of West African States (ECOWAS) Common External Tariff (CET), effective February 1, 2016. The ECOWAS CET is considered a major platform for the establishment of customs union that would facilitate free trade and advance greater economic integration within the region.

The tariff is expected to help address problems such as cross-border smuggling and dumping in the sub-region. Government is currently monitoring and evaluating the impact of the new regime on various sectors of the economy.

Implications of Global Development for Ghana's Economy

Mr Speaker, we addressed the risk of commodity price volatility. Government would work towards diversifying the economy. We would add significant value to our exports, and support local manufacture of imported goods which can be produced locally in partnership with the private sector.

Macroeconomic performance for 2016


Mr Speaker, growth has remained subdued over the period. The 2016 GDP, based on a provisional term for the first three quarters of the year, is estimated at 3.6 per cent, with the non-oil real GDP estimated at 4.6 per cent, same as target.

At the sectorial level, the industry sector, specifically mining and quarrying, underperformed due to the contraction in

upstream petroleum output which constitutes the bulk of the mining and quarrying subsector. All the subsectors in the agricultural sector, however, recorded positive growth rates. The services sector continues to dominate the sectors with a share of 54.3 per cent in


Mr Speaker, inflation, which remained elevated for most part of 2016, began to slow down towards the end of the year. Inflation began the year at 19 per cent, peaked at 19.2 per cent in March and ended the year at 15.4 per cent.

Monitoring credit development

Mr Speaker, the key monetary aggregates in credit to the private sector recorded slow growth in 2016 in light with tight monetary policy stance. The broad money supply and two plus at the end of 2016 recorded an annual growth of 22 per cent compared to 26.1 per cent in the same period of 2015. This was mainly driven by a moderate growth of 19.5 per cent in net domestic assets, and a net foreign access growth of 29.8 per cent in December 2016.

Growth in total outstanding credit to the public and private institutions moderated further in December 2016; a reflection of a higher incidence of non- performing loans and the tight monetary policy stance. The annual growth in total credit slowed to 17.6 per cent at the end of December 2016, from the 24.9 per cent recorded in 2015.

Stock Market Developments

Mr Speaker, annual changes in the Ghana Stock Exchange (GSE) Composite Index remain negative, generally reflecting investor preference for higher yield in money market instruments. The GSE Composite Index lost 15.3 per cent year on year in December 2016, to close at
Mr Ofori-Atta 11:05 a.m.
1,689.09 points from 1,994.91 points in December, 2015.
Total Market Capitalisations stood at 52.7 billion at the end of December 2016, which showed a year on year decline of 7.8 per cent.
Interest rates
Mr Speaker, interest rates in 2016 exhibited mixed performance. The Bank of Ghana Policy Rate was kept at 26 per cent until October 2016, as risk to inflation and growth were assessed as balance. The policy rate, however, was reduced to 25.5 per cent as inflation pressures eased while domestic growth conditions continued to deteriorate.
Yields on short-term Government securities decreased while those of medium to long-term Government of Ghana bonds increased in line with Government's policy to properly align the yield curve and extend the maturity profile.
Exchange rates
Mr Speaker, the Ghana cedi remained relatively stable against the major currencies in the currency market in 2016 on account of tighter monetary policy and improved foreign exchange inflow.
However, this trend was reversed in the round up to the December elections as December pressures mounted. The Ghana cedi recorded a cumulative depreciation of 9.6 per cent and 5.3 per cent against the US dollar and euro respectively, but appreciated by 10 per cent against the Pound Sterling in the interbank market in
Mr Speaker, the balance of payments turned out surplus for the first time since
2011 due to improved current account balance. Accordingly, there was a buildup in gross foreign assets, which supported the relative stability in the exchange rate.
The Balance of Payments (BOP) surplus was US$247 million compared to a deficit of US$129 million in 2015. The trade balance improved from a deficit of US$3.1 billion in 2015 to a deficit of US$1.7 billion in 2016, due to increased export receipts by 7.2 per cent and a decline in imports by 5.3 per cent.
The gross foreign assets at the end of December was estimated at US$6.2 billion, from US$5.9 billion at the end of December, 2015, representing a buildup of US$277 million. [Hear! Hear!] This was sufficient to provide cover for three and a half months of import in goods, same as in December 2015.

Fiscal developments

Mr Speaker, the main objective of fiscal policy as envisioned in the 2016 Budget Statement was to consolidate Govern- ment finances by reducing the fiscal deficit from 6.3 per cent of GDP in 2015 to 5 per cent of GDP in 2016.

The original data for 2016, however, indicates that the envisioned fiscal consolidation was not achieved. As a result, total revenue, domestic revenue and grants, was 11.1 per cent below target -- an actual of GH¢33.7 billion against the target of GH¢37.9 billion, while expenditure in clothing and outstanding expenditure claims exceeded the target by 16.2 per cent.

These slippages resulted in the fiscal deficit on commitment basis of 10.3 per cent of GDP. On cash basis, the fiscal deficit was 8.7 per cent of GDP against a target of 5 per cent of GDP. The primary

balance for the period recorded a deficit of 1.4 per cent of GDP against a targeted surplus of 1.2 per cent of GDP.

Mr Speaker, the shortfall in total revenue and grants was broadly attributed to the impact on energy challenges on household and firms, lower than anticipated receipts from oil, due to both lower than programmed bench mark crude oil price and production and non- realisation of proceeds from both tax and non-tax categories. In addition, tax compliance was relatively weak.

Mr Speaker, total expenditures including outstanding obligations amounted to GH¢ 51.1 billion at the end of December 2016. Outstanding obligations of GH¢5 billion comprised Master Bill of Lading (MBL) obligations with the Ministry of Finance currently, which had not been captured on the Ghana Integrated Financial Management Information System, (GIFMIS), as well as outstanding payments to statutory funds. These outstanding obligations relate mostly to compensation of employees, goods and services and domestically finance capital expenditure.

Petroleum receipts in 2016

Mr Speaker, in 2016, Ghana National Petroleum Corporation (GNPC) lifted six parcels of crude oil consisting of the 31st

to 35th Jubilee and first Tweneboa Enyenra Ntomme (TEN) liftings on behalf of the State, and exported a total of 21,580 million scarps of gas to Ghana National Gas Company. Total crude lifted was 5,856,921 barrels of oil. Receipts from crude oil liftings for 2016 included revenues from the sale of 4.8 million barrels of oil from the 30th lifted in December 2015, and the 34th Jubilee lifting which amounted to US$207.79 million. The proceeds from the 35th Jubilee and first TEN Liftings in

December 2016 were received in the first quarter of 2017.

Mr Speaker, actual petroleum received for 2016 fell short of the 2015 performance by 29.1 per cent due to the continuous decline in crude oil prices, a decline in Jubilee production and lower TEN production.

Mr Speaker, total public debt stock, as earned in 2016, stood at almost 73 per cent of GDP up from 72 per cent in 2015. This was due to the larger than expected fiscal deficit and financing requirement in 2016. Domestic and external debt stood at 31.7 per cent of GDP and 40.8 per cent respectively. In nominal terms, the public debt-stock as at the end of 2016 stood at GH¢122.3 billion with domestic and external debts of GH¢ 53.4 billion and GH¢ 68.9 billion respectively.

Energy levies

Mr Speaker, the Energy Sector Levies Act 2015 (Act 899), was enacted, and I beg to quote:

“AN ACT to consolidate existing energy sector levies to promote prudent and efficient utilisation of proceeds generated from the levies, impose a price stabilisation and recoveries levy, facilitate sustainable long-term investments in the energy sector and to provide for other related matters”

Mr Speaker, the law requires the utilisation of the energy sector levies mainly for the clearance of legacy debts of State-Owned Enterprises (SOEs) operating in the energy sector to support power generation and power sector infrastructure, subsidies for premix fuel and the stabilisation of petroleum price. A total amount of GH¢3.2 billion was programmed to be collected as total
Mr Speaker 11:05 a.m.
Hon Members, Order!
Mr Ofori-Atta 11:05 a.m.
Mr Speaker, Government's policy objective for the medium-term, among others, would be to build the most business, friendly and industrialised economy in Africa, which is capable of creating decent jobs and prosperity for all Ghanaians, modernise agriculture, improve production efficiency, achieve food security and profitability of our farmers with special emphasis on value addition; develop leadership skills; quality education, entrepreneurship; job skills and creative skills; and ensure a functioning social protection system that would address the need of the weak, marginalised, socially vulnerable and a preferential option for the poor, among others.
Mr Speaker, to achieve our broad macro-economic objectives, our policy direction would be to restore and sustain macro-economic stability to shift the focus of economic management from taxation to production, to manage the economy competently and with integrity, and make the machinery of Government work to deliver the benefits of progress for all Ghanaians.
Mr Speaker, prudent monitoring and external sector policies would also be pursued by the Bank of Ghana to
complement the fiscal policy stands to ensure price and exchange rates stability.
Mr Speaker 11:05 a.m.
Mr Ofori-Atta 11:05 a.m.
Mr Speaker, we believe that, our medium-term policies, anchored in fiscal discipline, a broadened tax base, elimination of wasteful expenditure, prudent debt-management strategies, complementary monitoring policy and sustainable external balance would ensure even better micro economic outcomes in the medium term.
Mr Speaker 11:05 a.m.
Hon Members, order! Order!
The debate would ensue later.
Mr Ofori-Atta 11:15 a.m.
Mr Speaker, consistent with section 16 of the Public Financial Management (PFM) Act 2016 (Act 921), we have also set the following targets on primary and secondary fiscal indicators to monitor the fiscal health of the economy towards the achievement of our fiscal policy objectives in 2017-- non-oil primary deposit of 0.8 per cent of GDP, public debt stock equivalent towards strength of 70.9 per cent of GDP, capital spending of 12.6 per cent of total expenditures and domestic revenues to GDP ratio of 21.4 per cent.
Resource mobilisation for 2017
Mr Speaker, total revenue and grants, including programmed receipts from petroleum for 2017 fiscal year, is estimated at GH¢44.9 billion. This indicates a 33.5 per cent increase over the provisional outturn in 2016. Total non-petroleum revenue and grants is estimated at GH¢42.6 billion, representing a 29.2 per cent increase over the provisional outturn in 2016.
Mr Speaker, total receipts from petroleum is estimated at 1.2 per cent of GDP and amounts to GH¢2.4 billion, representing 231.2 per cent increase over the outturn in 2016. Domestic revenue is estimated at GH¢43.4 billion or 21.4 per cent of GDP, and it is expected to be 33.5 per cent higher than the provisional outturn in 2016.
Mr Speaker, total tax revenue is estimated at GH¢34.4 billion, representing 6.9 per cent of GDP. Of this amount, non- petroleum tax revenue is estimated to grow

by 32.4 per cent, and this amounts to GH¢33.8 billion, which is equivalent to 16.9 per cent of non-oil GDP.

Taxes on income and property is estimated to increase by 47.7 per cent to GH¢13.4 billion in 2017, accounting for 39.1 per cent of total tax revenue. Of this amount, royalties from petroleum is estimated at GH¢616.8 million.

Taxes on goods and services are estimated at GH¢13.9 billion, representing a 13.3 per cent increase over the provisional outturn in 2016, and 40.3 per cent of estimated total tax revenue for 2017. [International trade taxes are estimated at GH¢7.1 billion, representing 3.5 per cent of GDP and 20.6 per cent of total tax revenue. This estimate represents the 61.1 per cent increase over the provisional outturn for 2016.

Mr Speaker, the significant drop of this tax type emanates mainly from additional GH¢1 billion in-tax measures that would be realised as savings from the reduction in the amount of import exemptions that would be granted in the 2017 fiscal year.

Mr Speaker, non-tax revenue is estimated at GH¢6.7 billion, representing 15.3 per cent of domestic revenue. An amount of GH¢3.4 billion is expected to be retained by MDAs for the funding of their activities, and the rest lodged in the Consolidated Fund. Of the total amount estimated for non-tax revenue, an amount of GH¢1.7 billion is estimated as non-tax petroleum revenue.

Mr Speaker, grants from development partners is estimated at GH¢1.5 billion, equivalent to 0.8 per cent of GDP.

Resource allocation for 2017

Mr Speaker, total expenditure, including provision made for the clearance of arrears and outstanding commitments in 2017 is estimated at GH¢58.1 billion,
Mr Ofori-Atta 11:15 a.m.
equivalent to 28.6 per cent of GDP. The estimated expenditure for the year represents a 13.7 per cent increase over the provisional outturn for 2016. Of this amount, GH¢3.7 billion, equivalent 1.8 per cent of GDP and 6.4 per cent of total expenditure, would be used for the clearance of arrears and outstanding commitments.

Mr Speaker, compensation of em- ployees is estimated at GH¢16 billion. Of this amount, GH¢14 billion, equivalent to 6.9 per cent of GDP expenditure on goods and services is estimated at GH¢3.5 billion, representing 1.7 per cent of GDP. Total interest payments which is estimated at GH¢13.9 billion, representing 23.9 per cent of total expenditure, and it is equivalent to 6.9 per cent of GDP. Of this amount, domestic interest payment constitutes 80.5 per cent of the total interest payments, and amounts to GH¢11.2 billion.

Mr Speaker, the existing legislation which has underpinned the estimation of grants to other government units over the years, is being reviewed to break the cycle of rigidities in the Budget Statement. Consequently, grants to other Government units, compromising statutory payments into the National Health Insurance Fund, Ghana Education Trust Fund, the District Assemblies Common Fund, Road Fund, Energy Fund, transfer to Ghana National Petroleum Company, retention of internally generated funds by MDAs, and other earmarked funds, has been constrained to a ceiling of 25 per cent of all our tax revenues.

The total allocation for grants to other government units is GH¢9.7 billion.

Mr Speaker, a total amount of GH¢7.1 billion has been allocated for capital expenditure. Of this amount, 38.9 per cent would be financed from domestic sources and the remaining from foreign sources.
Mr Speaker 11:15 a.m.
Mr Ofori-Atta 11:25 a.m.
Mr Speaker, net domestic financing is estimated at GH¢14.6 billion, equivalent to 7.1 per cent of GDP. This includes financing from divestiture receipts of GH¢1.8 billion. Net foreign financing is estimated to constitute a net repayment of GH¢1.3 billion, equivalent to 0.6 per cent of GDP, an amount of GH¢300.7 million is estimated to be saved in the Ghana Petroleum Contingency Fund, while the Sinking Fund is expected to be drawn down by GH¢716.1 million — [Interruptions.]
Projection of 2017 petroleum receipts and allocation
Mr Speaker, the estimated Benchmark Revenue (BR) price for crude is US$56.142 per barrel for 2017, with a benchmark output of 43,875,920 barrels, which is
120,208 per day, and 32.5 million scarps for oil and gas respectively.
The petroleum revenue for 2017 is estimated at US$515 million, with BR projected at US$242 million.
Mr Speaker, the second three, year cycle for the review of the petroleum revenue distribution formula as stipulated in the Petroleum Revenue Management Act (PRMA) has elapsed. We would like to request this august House to maintain the existing distribution formula as follows:
1. 30 per cent of the net carried and participating interest to GNPC;
2. 70 per cent of net receipts after GNPC to the Annual Budget Funding Amount (ABFA);
3. 30 per cent of net receipts after GNPC for the Ghana Petroleum Funds;
4. 30 per cent of the amount allocated to the Ghana Petroleum Funds to the Ghana Heritage Fund; and
5. 70 per cent of the amount allocated to the Ghana Petroleum Funds to the Ghana Stabilisation Fund.

We would also like the House to approve the following priority areas for the spending of the ABFA for 2017 to 2019 in line with the PRMA -- agriculture, fiscal infrastructure and service delivery in education, fiscal infrastructure and service delivery in health; and road and rail infrastructure development.

The medium-term debt strategy and debt sustainability analysis.

Mr Speaker, the debt strategy for the medium-term will be to manage the public debt at the lowest cost and at prudent levels of risk to bring our debt-to- GDP ratio to 65 per cent over the medium-term.

Consequently, in accordance with the requirement of the PFMA, my Ministry would conduct and publish a debt sustainability analysis and update the Medium-Term Debt Management Strategy (MTDS) to guide the borrowing plan and operations. The reports would inform policy decisions leading to the reduction in the debt burden and insulation against other fiscal vulnerabilities.

Sectoral performance and outlook

Mr Speaker, the sectoral policies are designed to achieve our broad objectives of jobs and wealth creation, and macroeconomic stability, while ensuring compliance with the PFM Act. Permit me to update this august House on the performance of some key sectors of the economy, and the outlook for 2017 and the medium-term.

Mr Speaker, I would begin with this august House, the Parliament of Ghana. Parliament continues to discharge its mandate through the consolidation of 181 Papers including 25 Bills, 4 Legislative Instruments, 8 Constitutional Instruments, 19 Loan Agreements and 39 Committee Reports. Out of the 25 Bills laid, 18 were passed into law. Parliament also facilitated the establishment of the Scrutiny Office to provide expert analysis of policy measures on Bills. Credits, loan agreements and international financial transactions which were before this House for approval.
Mr Ofori-Atta 11:35 a.m.
Mr Speaker, in 2017, the Office would be strengthened to undertake pre- legislative scrutiny of Bills through research and information, pursuant to the PMF Act.

The Parliamentary Training Institute (PTI), established in 2016, would be strengthened to undertake and promote research in parliamentary democracy. A strategic plan for the take of the institute would be developed in 2017.


Mr Speaker, the Government recog- nised agriculture as a main ankle of the country's economy. Unfortunately, we have witnessed a steady decline in the sector, and production levels have fallen consistently over the years. In the medium term, we intend to modernise the sector to improve productivity and achieve food security and profitability for our farmers.

Mr Speaker, in 2017, Government would launch the Planting for Food and Jobs Campaign. The Campaign is designed to encourage all citizens, both urban and rural, to take up farming as a full part-time activity. It is intended to structure it along the lines of the erstwhile Operation Feed Yourself Programme in the 1970s. The Campaign would involve the production of maize, rice, soya beans, sorghum and vegetables. Other crops would be adopted in subsequent years.

The Campaign would be anchored on five pillars, namely, provision of improved seeds; supply of fertilizers, provision of dedicated extension services, marketing; and e-agriculture and monitoring. This initiative is expected to increase the production of maize by 30 per cent on the current production levels; rice by 49 per cent; soya bean by 25 per cent; and sorghum by 28 per cent.

This would create 750,000 jobs in both direct and indirect employment. [Hear! Hear!] The Ministry would import improved seeds to augment any shortfall for the Planting for Food and Jobs campaign.


Mr Speaker, the fisheries sub-sector employs a significant number of our people, especially, along the coastal areas. Over the past years, efforts have been made to also boost both marine and inland fishing and support aqua-culture development. However, we believe that we need to modernise the artisanal fishing methods to ensure sustainable fishing and also improve production levels.

To modernise and transform the industry, the Ministry would complete Phase 1 of the Anomabu Fisheries College to enhance research and knowledge base in fisheries technology for all operators. It would also collaborate with relevant institutions and the private sector to develop modern landing sites and storage facilities at Jamestown, Cape Coast, Axim and Mumford.

Trade and Industry

Mr Speaker, the country's industrial sector faces significant challenges, the principal ones of which are lack of access to finance; high interest rates; inadequate and poor quality raw materials for industrial processing, poorly developed domestic trade; and an unreliable and expensive power source.

The goal of Government over the medium term is to address these challenges in ways that would enable industries to thrive and become a major source of jobs especially for our youth.

A number of major policy interventions would be initiated this year as part of the strategy. In 2017, the Ministry would roll up its district level component of the national export strategy to develop one export commodity in every district.

In 2017 the Ghana Commodities Exchange Project would establish a state of the art transparent and professional market institution to create an orderly, transparent and ready market for goods that are produced by farmers in the country.

Tourism, Culture and Creative Arts

Mr Speaker, tourism, culture and creative arts remains one of the most underdeveloped sectors in our economy despite the immense growth potential and opportunities for job creation. When developed, the sector can positively impact the lives of many individuals, families, communities and small enterprises in our country, providing needed jobs for our teeming youth. Our objective is to transform the country into a major meeting incentive conference and exhibition centre. To facilitate this, we

would aggressively develop our tourist sites to bring them to world class standards.

The Ministry would partner the private sector to develop the Efua Sutherland Park into an ultra-modern world class park. Especially for 2017, we would use information technology to promote and market tourism via the single portal window.

Mr Speaker, the Ministry would also undertake a food festival to showcase the diverse rich Ghanaian foods through cooking competitions throughout the country.

Mr Speaker, this Government intends to ensure that Ghanaians enjoy reliable, efficient and affordable power to provide comfort in their homes, and support the development and growth of their businesses.

In 2016, significant efforts were made to address some of the challenges in the sector. This included an increase in the total installed generation capacity by 880 megawatts.

In 2017, Government would continue to increase the installed generation capacity of the country to meet the growing demand for electricity.

A total of 1,227MW of installed capacity is scheduled to be added, 370MW for Aksa Projects and 107MW for GPJC Project and 350MW for Cenpower
Mr Speaker 11:35 a.m.
Order! Order!
Mr Ofori-Atta 11:35 a.m.
Furthermore, steps would be taken to ensure that outstanding issues surrounding the implementation of the Ghana Compact II are addressed to allow for its implementation in order to achieve the desired objectives.
Mr Speaker, with regard to oil and gas, Government would work with the Jubilee partners to address the shortfall in oil and gas production resulting from the 2016 damage of the turret bearing on Floating Production Storage and Offloading vessel (FPSO) Kwame Nkrumah and adopt a three - Phase approach to convert the FPSO Kwame Nkrumah to a permanently spread mall.
First, gas from the Tweneboa, Enynera, Ntomme (TEN) field to the gas processing plant is expected in the first half of 2017. Ghana National Petroleum Corporation (GNPCs) engaging of the partners to develop an integrated technical and commercial schedule that would target gas set up in the second quarter of the 2018.
Railway development
Mr Speaker, this Government believes that the rail would be a major catalyst to drive the growth that we envisage in the coming years.
Rail transportation provides safer, cheaper and faster way of moving of goods and people to facilitate trade and support economic activities. Our vision is to open up the country and provide new opportunities for our people to do business and trade among themselves.
In that regard, Government would complete the Sekondi to Takoradi via Kojokrom section and continue with the section from Kojokrom to Tarkwa through Nsuta. This would help improve the operational performance and revenue of Ghana Railway Company Limited and enable the company wean itself off Government support. In addition, it would enhance the performance and competitiveness of the manganese mine located on the corridor.
Mr Speaker, work would commence on the western line which starts from Takoradi and terminates at Kumasi, having two branch lines namely; Dunkwa to Awaso and Kojokrom to Sekondi, covering a distance of some 340 kilometres (km). The corridor, when completed, would facilitate the haulage of manganese, bauxite, cocoa and other bulk commodities. The feasibility studies and front ending engineering design have already been done on the line. [Hear! Hear!] -- We would also initiate discussions to secure funding for other major projects such the central spine which stretches from Kumasi to Paga, covering a distance of 770 km. the corridor is a green field and would be developed in sections.
The sections are Kumasi to Buipe and Buipe to Paga. Pre-feasibility study was undertaken on the line and in 2017 we plan to undertake full feasibility studies to enable the Ministry to invite developers and source funding for the development.
The Eastern Railway Line would cover a distance of 330 kilometres and start from Accra to Kumasi, with a branch line from Achimota to Tema, and when the line becomes operational, it would decongest the port and facilitate the movement of cargo and passengers to Kumasi and its environs.
Some Hon Members 11:35 a.m.
Eihh, to your hometown?
Mr Speaker 11:35 a.m.
Order! Order!
Mr Ofori-Atta 11:35 a.m.
Government recognises that the dream of all Ghanaians is to own a home or at least, have decent rental accommodation. There are, however, major constraints to this dream. This includes the high cost of buying and renting a home, under supply of annual requirements of housing units, lack of long- term financing for real estate development and lack of appropriate financing arrangements.
Mr Speaker, to reduce the housing deficit, Government would use appropriate mix of public policy and public-private investment to deliver quality and affordable housing solutions that meet the needs and financial capacity of ordinary Ghanaians.
Water and Sanitation
Mr Speaker, major water projects to be undertaken in 2017 would include the continuation of the Greater Accra Metropolitan Area Water Extension
project as well as those of Kumasi and Cape Coast. The Kpone, Akim Oda and Ho Water Expansion Projects, Tono water treatment project for the Upper East Region in Navrongo as well as those of the Yendi and Damongo would be undertaken while the Wa Project would be completed. Preparatory work for the Sunyani and Techiman, as well as the Sekondi-Takoradi water supply projects would be finalised.
Mr Speaker, in addition, we would complete the on going 1000 borehole projects and also initiate the construction of, at least, 2000 boreholes across the country as part of the drive to get us closer to the desired goal of water for all.
In 2017, the Ministry would pursue a comprehensive sludge management programme targeted at constructing two sludge treatment plants in Sekondi- Takoradi and Tamale Metropolitan areas with the objective of streamlining the disposal of fecal matter into water bodies and drains.
The Ministry would aslo provide appropriate uniforms and identification for 4,500 environmental health officers nationwide to ensure visibility and enforcement of environmental sanitation and basic hygiene bye-laws.
Roads and Highways
Mr Speaker, the Ministry maintained its focus on the routine and periodic maintenance activities to protect the huge investment made by Government in the provision of the road infrastructure. In 2016, routine maintenance activities were undertaken on 10,723 kilometres of the trunk road network, 16,183 kilometres on the feeder road network and 9,384 kilometres on the urban road network.
Mr Speaker, in spite of the major investments made in the road sector, we continue to have some major deficits. The past few years has recorded a significant increase in the award of contracts, leading
Mr Speaker 11:45 a.m.
Order! Hon Members --
Mr Ofori-Atta 11:45 a.m.
Mr Speaker, the mandate of the Ministry is to provide equitable access and quality education to all Ghanaians, to make them functional citizens in other to contribute to the growth and development of the country. Over the medium-term, government aims to shift the structure and content of Ghana's education system away from mainly passing examinations to building character, nurturing values and raising literate, confident and engaged citizens who could think critically.
To overcome this challenge, govern- ment would also redefine basic education to include secondary education, and covering technical, vocational and agriculture education.
As part of this initiative, the Basic Education Certificate Examinations (BECE) would be used as a tool for placement of students into second cycle schools and not for certification. To improve the quality and relevance of education and further make the product of our school system competitive, government would review the basic level curriculum to focus on the four “Rs” of Reading, Writing, Arithmetic and Recreation to include Life Skills and Creative Skills. Government intends to ensure that, all our children have these basic skills when they exit the primary school system.
Mr Speaker 11:45 a.m.
Mr Ofori-Atta 11:45 a.m.
Mr Speaker, I am pleased that my Hon Colleagues across the aisle have accepted free Senior High School education.
Thank you for the reminder.
Mr Speaker 11:45 a.m.
Hon Members, the debate is yet to come.
Mr Ofori-Atta 11:45 a.m.
Mr Speaker, pro- duction and distribution of health personnel, high under-five and maternal mortality rates and neglect of the mental health sub-sector result in huge unmet needs of mental health services. In 2017, there would be improved coverage of antenatal care services and delivery by skilled attendants as expected to increase from the 2016 targets of 78 per cent and 53 per cent to 80 per cent and 55 per cent respectively. The target for fully immunised children would be maintained at above 90 per cent in 2017.
Gender and Social Protection
Mr Speaker, following the conclusion of the Millennium Development Goals in 2015, Ghana joined the world in developing the Sustainable Development Goals (SDGs) which was endorsed by the United Nations at its 70th Session in September 2015. The SDGs is adopted globally to end poverty, protect the planet and ensure prosperity for all.
In order to fight extreme poverty and vulnerabilities and ensure that no group is disadvantaged and left behind in the development process, government is committed to improving on social protection policy implementation and systems.
The Ministry of Gender, Children and Social Protection would facilitate the passage of the Affirmative Action Bill and the Domestic Workers Bill. We would re- focus the Livelihood Empowerment Against Poverty (LEAP) Programme and adopt effective means of targeting and enrolling beneficiary households. The School Feeding Programme would also be reviewed to make it more transparent, effective and linked to the agriculture subsector initiatives.
Youth and Sports Development
Mr Speaker, the youth would drive the discovery of new technologies, innovation and growth in the future. Our focus over the medium term is to create an enabling environment to build the capacity of our youth to take on more active roles in our country's future and its development. A number of initiatives that we are rolling out are targeted at the youth.
In the area of sports development, feasibility studies would be completed to facilitate the expansion of the infrastructure stock and transform the National Sports College into a centre of excellence through Public Private Partnership arrangements. Additional efforts would be made to support other disciplines starting from our schools.
Policy Initiatives
Mr Speaker, despite the major macroeconomic and structural challenges that we face as a nation, we believe that with the appropriate policy interventions, we would set the stage for job creation opportunities, ease hardships and secure bright for all of our families, businesses and industries.
The following policy initiatives are, therefore, designed to help improve the business environment, instil fiscal discipline and promote investment in critical infrastructure, especially in rural and deprived communities.
Mr Ofori-Atta 11:45 a.m.

Improving the Business Environment -- Tax Incentives

Mr Speaker, a number of tax measures have been introduced in recent years in an attempt to deal with revenue shortfalls. Some have proven to be nuisance taxes and they have no revenue yielding potential and at the same time they impose significant burden on the private sector and on the average Ghanaian citizen.

As part of our commitment to re- energise the private sector, government has decided, as pledged, to review these taxes to provide relief for businesses. [Hear! Hear!] Mr Speaker, the following specific measures shall be implemented in the short to medium-term, with this Budget Statement to abolish the 1 per cent Special Import Levy, abolish the 17 and a half per cent Value Added Tax (VAT) on Financial Services, abolish the 17.5 per cent on selected imported medicines that are not produced locally, initiate steps to remove import duties on raw materials and machinery -- [Interruption.]
Mr Speaker 11:45 a.m.
Hon Members, Order!
The time for debate would be ample and it would soon come.
Mr Ofori-Atta 11:55 a.m.
Mr Speaker, we would initiate steps to remove import duties on raw materials and machinery for production within the context of the ECOWAS Common External Tariff Protocol. We would abolish the 17. 5 per cent on domestic airline tickets, and we would abolish the 5 per cent Value Added Tax (VAT) on real estates sales -- [Interruptions.]
Mr Ofori-Atta 11:55 a.m.
Mr Speaker, to all our friends in Abossey Okai, we would abolish duties on the importation of spare parts. [Uproar]
Mr Speaker 11:55 a.m.
Order! Order!
Mr Ofori-Atta 11:55 a.m.
Mr Speaker --
Mr Speaker 11:55 a.m.

Hon Members, order!
Mr Ofori-Atta 11:55 a.m.
Mr Speaker, I acknowledge that these seem impossible a few minutes ago, but we shall abolish duties on the importation of spare parts. [Uproar]
Mr Speaker 11:55 a.m.
Hon Members, order!
Mr Ofori-Atta 11:55 a.m.
Mr Speaker, President Nana Akufo-Addo's measures to eliminate nuisance taxes are not over. We shall abolish levies imposed on kayayei by local authorities. [Uproar.]
Mr Speaker 11:55 a.m.
Shall we progress, Hon Members?
Hon Members, order!
Hon Members, let him do the presentation and we shall have our say.
Hon Minister, you might continue.
Mr Ofori-Atta 11:55 a.m.
Mr Speaker, we would further exempt from taxation the gains from the realisation of securities listed on the Ghana Stock Exchange.
Mr Speaker 12:05 p.m.
Mr Ofori-Atta 12:05 p.m.
Mr Speaker, we would also implement tax credits and other incentives for businesses that hire young graduates, but we are not done. We would reduce the National Electrification Scheme levy from 5 per cent to 3 per cent, and we would reduce the public lightning levy from 5 per cent to 2 per cent.
Review of import duty and tax exemptions
Mr Speaker, while Government's focus is on reducing taxes to enhance production, we are also determined to tackle the systemic abuse in the exemption regime. There shall be a comprehensive review of the regime on import duty exemptions and tax reliefs, with a view to eliminate abuses and improve efficiency in the application of these incentives.
Mr Speaker, to this end, the review would cover, among others, the following exemptions and tax reliefs as a matter of urgency; import duty, taxes and levies payable by MMDAs and other government departments, import duties on all forms of taxes and levies payable by both domestic and foreign companies, suppliers and contractors executing projects and contracts in the country, import duty on all forms of taxes and levies payable by employees, directors and senior officials of both domestic and foreign companies, suppliers and contractors executing projects in the country, import duties and all forms of
taxes and levies payable by both domestic and foreign companies and investors doing business in the country, and import duties on all forms of taxes and levies payable by non-governmental and charity organisations.
Mr Speaker 12:05 p.m.
Local content
Mr Ofori-Atta 12:05 p.m.
Mr Speaker, Government believes in empowering the local private sector, and would pass legislation to require that over time, at least 70 per cent of all Government projects and procurements are executed by local corporations and enterprises. We would set asides for entities owned by women, persons with disability and those established under the Youth Enterprise Fund, among other initiatives.
Government would introduce and enforce a local content policy for government projects and procurements that would focus on job creation and local value addition with emphasis on skills improvement.
To ensure the success of this policy, Government would require among other things, a job impact analysis of all qualifying projects that must demonstrate clearly positive job creation with skills improvements and other local value addition that must pass strict criterion established by the government.
Mr Ofori-Atta 12:15 p.m.

Mr Speaker, L.I. 2204, which was passed in 2013 to maximise value addition and job creation through local value addition would be expanded and legislated as local content for the country.

Job impact analysis

Mr Speaker, in the push towards job creation and skills development, Government would introduce a mandatory job impact assessment for all public sector projects or initiatives. Job impact assessment would also be required of private sector entities that access government projects or contracts.

In other words, all public sector projects, whether executed by the public sector, or the private sector contractors, must undergo a job impact assessment to evaluate the potential job creation impact. This would enable Government to analyse how various jobs are being created so as to better structure incentives and stimuli for higher skills and opportunities for Ghanaians.

Banking sector initiatives

Mr Speaker, banks play an important role in an economy. Despite past interventions, the banking sector still faces major challenges. We are committed to working with the financial sector to resolve these challenges.

A strong private sector credit growth is needed to support our medium term GDP growth to increase productivity and create jobs. We would harmonise and streamline some of the existing policies to make the sector more efficient. Policy interventions would focus on improving liquidity for banks through the payment of SOE related debt due banks over the short to medium term, in line with our debt sustainability framework.

Mr Speaker, specific measures to be implemented in 2017 in the medium-term include streamlining the Energy Sector Levy Act (ESLA) to accommodate all the existing legacy debts for the banking and the private sectors which include energy sector debt for distribution companies and other energy sector related debts, ensuring the revenue stream from ESLA are properly used to ensure certainty of cash flow for the payment of all corresponding debts, working with commercial banks to ensure that they are able to issue bonds on the back of the streamlined ESLA revenue for immediate liquidity.

Mr Speaker, in addition, the Bank of Ghana, in collaboration with Government, would undertake the following structural reforms to the banking sector; increase the banking industry's minimum capital requirement and strengthen the licensing and regulatory framework; introduce risk capital requirements in addition to minimum capital requirements for banks; strengthen corporate governance by enforcing the term limits for board chairpersons and managing directors of commercial banks in accordance with the Banking Act. Enhance enforcement of single obligor limit for commercial banks and support mobile money and mobile banking businesses to enhance and expand financial services.

Mr Speaker, we would also support Ghanaian-owned banks with credit as they support the SME sector. We believe that all of these measures would help minimise systemic risk in the banking industry.

Capital market development initiative

Mr Speaker, the growth of Ghana's capital market is impeded by the lack of depth and liquidity. Addressing these challenges require the implementation of decisive measures in the short to medium

term to deepen the capital market, increase liquidity and trading activities and encourage more companies to be listed.

The specific measures to be imple- mented to improve capital market improvement, in 2016 and the medium term include the following; exempting from taxation, the gains from realisation of securities listed on the Ghana Stock Exchange, exempt the financial services industry from the financial services tax as I have mentioned; encourage a capital market content policy that enjoins companies operating in the energy and oil and gas, financial services, telecom, mining sectors to list a minimum percentage of their shares on the Ghana Stock exchange within five years of commencement of operations, and diverse government's holdings on some SOEs with a view to ensuring efficiency.

This would include the sale of government shares in some SOEs that are listed on the Ghana Stock Exchange.

We would work with the Securities and Exchange Commission to develop the regulations governing asset back instruments, including, real estate investment trust and mortgage by securities and enable the pensions industry to support the development of these asset classes and other alternative investment schemes.

Mr Speaker, the National Pensions Regulatory Authority (NPRA) would be moved back to be under the Ministry of Finance and the Ministry of Employment and Labour Relations. This is because just like the SCC and SSNIT, the NPRA is a financial services regulator, but of the pensions regulatory body that also deals with a lot of labour issues. Pensions are

about finance, financial contributions, and financial investments and benefit pay outs.

All the above financial decisions affect employees, hence the decision to have joint oversight of the two Ministries. NPRA would in addition be completely weaned off this year (2017).

Building an entrepreneurial nation

Mr Speaker, this Government seeks to build an entrepreneurial nation. The National Entrepreneurship and Inno- vation Plan (NEIP) is a flagship initiative which would be the primary vehicle for providing an integrated support for early stage, that is, startup businesses and small businesses, focusing on the provision of business development services, business incubators and funding for youth - owned businesses.

Mr Speaker, the National Entre- preneurship and Innovation Plan (NEIP) will enable quality new businesses to emerge and give them the space to grow, position them to attract finance and provide business development support services. The programme will assist these businesses to secure markets, critical formative years and tap into the wide supply chain and network during their growth periods.

National Industrial Revitalisaiton Programme (NIRP): A stimulus package for industry

Mr Speaker, growth in the industrial and manufacturing sectors have significantly declined over time, which has contributed to an unprecedented level of unemployment. The situation could be attributed to a variety of factors , including
Mr Ofori-Atta 12:15 p.m.

but not limited to, the high cost of capital, limited access to medium to long term financing, high cost of electricity and unreliable power supply, limited access to land for industrial activities as well as weak logistics and infrastructure support for industrial development.

Mr Speaker, it is against this background that the NIRP with a stimulus package for industry would be established to provide technical and financial support to existing companies that are currently distressed or face operational challenges but are deemed to be viable to benefit from the stimulus package which will put them in operation in the shortest possible time.

Industrialising Ghana from the ground up; One district; One factory

Mr Speaker, the One District; One Factory implementation which will commence this year will be closely intertwined with our NIRP -- [Interruption.] -- it is designed as a comprehensive programme for rural industrialisation driven by the private sector, which involves the setting up at least of one medium to large scale factory, in each administrative district of our country.

It is aimed at creating massive youth employment, especially in rural and urban communities, add value to the natural resources of each district, ensure even and spatial spread of industries to stimulate economic growth in all parts of the country, enhance the production of local substitutes for imported goods and promote exports and increase foreign exchange earnings.

Mr Speaker, it has the potential of transforming the industrial landscape of

Ghana and it will contribute significantly to the socio-economic development agenda of the country. We estimate that over 350 thousand direct and indirect jobs would be created from all parts of the country as a result of the implementation of this programme.

National Identification Programme

Mr Speaker, the benefits of having a modern, reliable and unique national identification system are enormous and imperative for the development of our nation. A robust identification system and the issuance and use of integrated multipurpose national identification card will enable us advance economic, civic and social activities in Ghana, and target particular developmental programmes.

Mr Speaker, it is against this background that the National Iden- tification Authority (NIA) was established in 2007, to oversee the registration of all residents in Ghana. However, a decade later, the NIA has made limited progress.

Mr Speaker, Government has commenced stakeholder consultations to revive and rollout the National Identification Scheme (NIS) in 2017. [Hear! Hear!] All registered persons will be provided with a unique identification number and an identification card.

Subsequently, a National Identification Card (NIC) shall be required for the provision and efficient delivery of public and private services, including financial services, mobile banking and commerce,

social safety net, health insurance and revenue collection, amongst others.

National Digital Addressing System

Mr Speaker, the last time the whole country was mapped, was in 1974. The lack of modern property addressing system in Ghana is a serious impediment to our developmental agenda. As part of our plans to enhance economic growth and development, Government has com- menced stakeholder consultations to develop and implement that National Digital Property Addressing System for the country in 2017.

Mr Speaker, the aim of the national property addressing system, is to have digital addressing for parcels of land and properties of the entire country. Every land or property will be assigned a unique identifier. This is aimed at facilitating improved ownership data and unique identification of properties. A proper addressing of properties will ensure efficient delivery of services for economic activity and the collection of taxes.

E-Services portal

Mr Speaker, in order to improve efficiency of service delivery by Government institutions with regard to acquisition of licenses and payment for services, Government established the E- Services Portal in 2012. This platform has helped in the delivery of Government services, licenses and permits, et cetera.

Mr Speaker, Government will expand coverage to all parts of the country and improve efficiency of service delivery through private sector participation in the E-services portal. This is expected to help reduce corruption, promote compliance

and improve the tracking of Government resources.

Expenditure management and control

Mr Speaker, our country continues to grapple with weak expenditure management and budgetary controls leading to excessive expenditure overruns and payment arrears resulting in persistent fiscal deficit. Mr Speaker, prudent expenditure management and commitment controls are therefore, very crucial in order to achieve the goals and objectives of this Budget.

The enforcement of the Public Financial Management Act (PFMA)

Mr Speaker, the Public Financial Management Act, (Act 921) passed by Parliament and enacted into law in August 2016 has the sole objective of strengthening the public financial management system in the country. The Act regulates the financial management of the public sector within a sound macroeconomic and fiscal framework.

It defines the responsibilities of persons entrusted with the management and control of public funds, assets, liabilities and resources in a manner consistent with the level of public debt, provide for the accounting and audit of public funds and provides for more robust sanctions and penalties.

Mr Speaker, the effectiveness of the law depends, to a large extent, on strong enforcement and compliance with the sanctions regime. Mr Speaker, Government will ensure that the robust sanctions regime provided for in the law are complied with by all public institutions.

The required institutional arrange- ments, including functional independence of the committees will be addressed to
Mr Ofori-Atta 12:25 p.m.

promote and enhance the effectiveness of the law.

Mr Speaker, in addition to the assignment of responsibilities and enforcement of sanctions, two provisions are crucial for the effective implementation of the law. First is the commitment controls provisions to curb the build-up of expenditure arrears.

Mr Speaker, to fully operationalise the law to enhance budget credibility, Government will ensure the introduction of the necessary regulation to support the implementation of the law in line with PFM stakeholders for effective implementation of the Act. Government through the Ministry of Finance will strengthen oversight of SOEs and public operations, as well as local government to help mitigate fiscal risk emanating from contingent liabilities.

Mr Speaker, to facilitate adherence to the provisions of the law, the Ministry will continue with the sensitisation programme for public institutions at the national and subnational levels, as well as for key stakeholders, including CSOs, Media, professional bodies and the public at large.

Establishment of the Fiscal Council

Mr Speaker, Ghana has been faced with significant long-term fiscal slippages and an escalating public debt stock leading to high risk of debt distress. This is principally due to the fact that our fiscal policy implementation lacks a transparent institutional arrangement for providing quality fiscal information to the public; a mechanism for ensuring accountability in implementing optimal fiscal policies to guarantee the stability of the system and an institution to ensure the credibility of fiscal projections provided by the Government.

Mr Speaker, to address this, Government would initiate the process towards the establishment of a fiscal council that would adopt and implement rules to anchor fiscal policy implementation.

The fiscal council would contribute to the accountability of Government, responsible for setting up medium-term fiscal policy anchors to guide fiscal policy, as well as monitor compliance.

The principal objective for the formation of the fiscal council are to ensure the credibility of our fiscal projections, to set up medium-term fiscal policy anchors to guide fiscal policy, and monitor compliance of fiscal policy rules.

Legal backing would be given to the Fiscal Council, through an amendment of the Public Financial Management (PFM) Act 2016 (Act 921) to, inter-alia, capture all the elements of a fiscal responsibility law.

Re-alignment of statutory funds

Mr Speaker, the President noted in the State of the Nation Address on the 21st of February, 2016, and I beg to quote:

“….The reality of the state of Ghana's public finances today are quite stark. Today, as a result of policy choices, we find ourselves in a situation where Ghana's total revenue is consumed by three main budgetary lines: wages and salaries, interest payments and amortization, and statutory payments. These three items alone account for 99.6 percent of Government revenue. This means that anything else that Government has to do outside of these lines, will have to be financed by borrowing or aid. The persistent resort to borrowing for any additional expenditures to meet the aspirations of our people is also not sustainable. We cannot continue this way with our public finances” (State of the Nation Address, 2017).

Mr Speaker, indeed, this problem of lack of fiscal space in the current budget architecture and the problems associated with earmarking was rightly recognised by the National Democratic Congress (NDC) Government in the 2010, 2011, 2015 and 2016 Budget Statements. In these Budget Statements, the then Ministers for Finance noted the following, and I quote:

“Statutory funds introduce extreme inflexibility in the management of the budget, giving no room for policy manoeuvre. Given the important social interventions that need to be scaled up and/or implemented, some key government programmes will have to be offloaded from the core budget to the statutory funds, in order to create space for the utilisation of discretionary expenditure in other priority areas.”

Mr Speaker, that is the 2010 Budget Statement.
Mr Speaker, this is also the 2011 Budget Statement, and I quote 12:25 p.m.
“…Over 75 per cent of the total wage bill and associated increases resulting from the Single Spine Salary Structure goes to employees in only three MDAs, namely the Education, Health and Local Government, which ironically are the very sectors with the statutory funds that introduce rigidities in the budget structure and leaves no revenue space for the sustainable implementation of a Single Spine Salary Structure…”
Mr Speaker, in the 2015 Budget Statement, the Hon Minister stated, and I quote 12:25 p.m.
“Mr Speaker, the National Budget is increasingly becoming inflexible to manage as well as to accommodate shocks and changes in Government priorities. These are mainly due to the earmarking of a huge component of the budgetary resources as statutory transfers in addition to existing statutory liabilities, such as wages and salaries, amortisation, and interest payments.”
Mr Speaker, in the medium term, government will realign expenditures under the Statutory Funds hitherto being catered for under the Consolidated Fund. Starting with the 2015 Budget, and as a transitional arrangement, Government will enhance the administrative process for aligning statutory fund expenditures to national policies and priorities.”
Mr Speaker, that is the 2015 Budget Statement. In the 2016 Budget Statement, the Minister says, and I quote:
Mr Speaker 12:25 p.m.
Hon Members, Order!
Mr Ofori-Atta 12:35 p.m.
Mr Speaker, quoting from the 2016 Budget Statement, I beg quote:
“ …To address the increasing rigidities in the Budget that limits the room for policy manoeuvre, Government will announce a policy of aligning the statutory and Internally Generated Funds to national fiscal goals in the 2014 Budget. Consequently in 2016, Statutory Fund Expenditure totalling GH¢564.6 million would be re-aligned to the Central Government Budget…”
Mr Speaker, in 2016, transfers to the earmarked funds constituted 33.5 per cent of national revenue, up from 28.2 per cent in 2015. These rigidities mean that Government's ability to shift public spending from one expenditure line item to another is hindered, even where current exigencies require Government to do so.
Consequently, it has become difficult to use public spending as an instrument to respond to changing public needs in all of our constituencies. Further, these increasing statutory rigidities have limited our flexibility and impeded our ability to meet our commitments, especially capital expenditure. As such, we continue to miss our obligatory disbursement to statutory
funds, due to the wish to fulfil other commitments.
Mr Speaker, in sum, we have been unable as a nation to comply with our statutory and budget requirements in respect of earmarked funds because they impose unhelpful rigidities in our public expenditure and development strategies as recognised by the NDC.

Mr Speaker, starting this year, Government would propose a cap of 25 per cent of revenue to all earmarked funds for the approval of this august House. The capping of transfers to earmarked funds to 25 per cent of tax revenues in any particular year would allow a re-alignment of budget revenues to Government public priorities, and in fact, make possible increase expenditure on Government priority, such as education, health, agriculture and infrastructure. However, we would make adjustments for constitutionally-mandated earmarked funds to make them whole.

Treasury and risk management

Mr Speaker, efficient budget imple- mentation requires a proper alignment of cash inflows and outflows. This would improve the creditability of budget implementation and cash allocation.

In line with this, Government would strengthen its treasury management functions by creating a treasury management unit in the Ministry of

Finance, to handle all treasury management and related functions

The current PFM law would be enforced with regards to utilisation of the Treasury Single Account. To this end, the bank accounts of all Government institutions would be transferred to the Central Bank, for ease of management and monitoring.

Mr Speaker, additionally, Government would eliminate all payments in cash at service delivery points in public service institutions, including the Ministries, Departments and Agencies (MDAS) and Metropolitan, Municipal and District Assemblies (MMDAs) in order to improve efficiency in service delivery and revenue collection to support the Treasury Single Account (TSA).

Improving payroll management

Mr Speaker, the size of the Public Sector Compensation Bill, which accounts for a significant proportion of domestic revenue, is a major concern for Government. It is one of the big three budget line items that continue to narrow Government's choices in pursuing higher economic growth and development programmes.

The Social Security and National Investment Trust (SSNIT) database will be used as a filter for the payment of public sector workers. Starting in April, all workers who have not been biometrically registered with SSNIT will be taken off Government payroll.

Recruitment and promotion of related arrears

Mr Speaker, in spite of the Public Services Commission policy on

recruitment and promotion, we continue to see delays in the processing of recruitment and in promotions.

These delays create frustrations for new recruits and serve as demotivation for serving officers due for promotion. Further, these delays lead to unexpected accumulation of arrears that hurt the integrity of our fiscal planning.

Mr Speaker, in order to control the wage bill and avoid compensation arrears that have not been provided for in our budgets, Government will, from 2017, strictly enforce the policy guidelines on the effective dates of promotions and recruitments within the public services.

Substantive effective days of recruitment and promotion shall not be backdated without the explicit permission of the Hon Minister for Finance in writing.

Enforcement of the Public Procurement Act

Mr Speaker, as part of our expenditure management framework, Government will strictly enforce the provision of the Public Procurement Act 2003 Act 921, as amended by the Public Procurement Act, 2016, Act 914 especially with regard to sole sourcing which has proven to pose a significant risk to fiscal policy management.

To ensure that public procurements are done within budgetary constraints, we intend to strengthen the procurement process by introducing another level of approval for MDAs and MMDAs.

To this end, Mr Speaker, sole source procurements by Ministries, Departments and Agencies (MDAs) and Metropolitan, Municipal and District Assemblies (MMDAs) beyond the threshold of GH¢50 million will be subject to explicit approval
Mr Ofori-Atta 12:45 p.m.

Improving debt management

Mr Speaker, as a sign of Government's commitment to ensuring public debt sustainability within the framework of the PFMA, the debt management strategy in 2017 envisages the introduction of new instruments to further lengthen the maturity profile of public debts, reduce cost and risk factors associated with the debt portfolio through effective liability management and support the development of the public sector.

Liability management

Mr Speaker, to improve the structure of public debt, Government will continue to implement sound liability management initiatives aimed at reducing interest cost and mitigating interest rates risk associated with the current debt portfolio.

This will involve the implementation of a wide variety of operations including the buyback of existing debts using a Sinking Fund account, interest rate hedging and the use of structured financial instruments, as market conditions permit.

Implementation of credit risk assess- ment

Mr Speaker, the current financial state and governance structures of the state- owned enterprises (SOEs), particularly in the energy sector, is worrying. This continues to pose challenges for fiscal policy outcomes.

In this regard, Government will implement the credit risk assessment framework to guide SOE borrowing and

continue to ensure that necessary security structures and instruments are put in place by the SOE to ensure they honour their debt obligations.

In addition, Government intends to establish a single entity with oversight responsibility of the SOEs. This forms part of broader SOE reform aimed at consolidating the state-ownership role, improve performance and ensure effective and efficient service delivery by SOEs.

Infrastructure for Poverty Eradication Programme (IPEP)

Mr Speaker, Government intends to pursue an inclusive development strategy aimed at radically improving the state of basic infrastructure at the constituency level, especially in rural and deprived communities.

The IPEP will be our main vehicle for tackling these challenges. It is designed to direct our capital expenditure towards local constituency level specific infrastructure and economic development priorities with particular emphasis on rural and deprived communities.

Mr Speaker, under IPEP, every one of our 275 constituencies will be, as I stated, allocated the equivalent of US$1 million annually -- [Hear! Hear!] Mr Speaker, this will be the equivalent of GH¢4.39 million annually.

It is expected that the projects selected under standardised guidelines will fall in the following categories: One District, One Factory; One Village, One Dam; small business development; agriculture inputs, including equipment; water for all projects and sanitation projects.

Establishment of development authorities

Mr Speaker, in order to ensure that IPEP and other local initiatives are implemented

in a well-coordinated manner, Government will set up three development authorities namely: Northern Development Authority (NDA); Middle Belt Development Authority; and Coastal Development Authority. The development authorities will be the main economic development implementing agencies in the areas they cover.

Mr Speaker, Government will restructure and transform the Savannah Accelerated Development Authority (SADA) into a more focussed Northern Development Authority dealing with the 57 constituencies as originally envisaged. We will make the NDA a flagship programme which will serve as a vehicle for delivering our economic transformation agenda in the three northern regions.

Mr Speaker, the Middle Belt Development Authority will serve as the main development agency of the middle belt of the country. The Coastal Development Authority will serve as the principal development agency for the coastal regions of the country.

Zongo Development Fund

Mr Speaker, as part of our efforts to develop the Zongo communities, Government will set up the Zongo Development Fund (ZDF) with seed money of GH¢219.5 million. The Fund will support the provision of critical infrastructure in education and training, health and sanitation, local businesses and centres of culture, as well as improve security in our Zongo communities.

The ZDF is expected to leverage its seed fund to attract additional funding from development partners, private sector institutions, civil society organisations

and other non-governmental organisa- tions.

Free Public Senior High School

Mr Speaker, adequate provision has been made for the funding of this monumental social intervention programme which is set to begin in September 2017 from the Annual Budget Funding Amount (ABFA) and other domestic revenue sources.

Other initiatives will be implemented in 2017 as follows:

Establishment of an Airport Free Zone.

Mr Speaker, airports all over the world are becoming increasingly multi-model, multi-functional enterprises creating considerable opportunities for commercial developments in areas they are located.

Available evidence suggests that airports tend to attract investments, and therefore, generate jobs. Many countries are considering airport cities or aerotropolis, airport centered urban economic regions as a vital means of expanding opportunities, creating jobs and promoting tourism.

Mr Speaker, Government has identified the establishment of sector targeted Free Zones as a major driver for capital inflows and jobs for Ghanaians starting this year with the preparatory work for attracting private investments into an Airport Free Zone (AFZ).
Mr Ofori-Atta 12:45 p.m.

The AFZ will be purely a private sector investment with Government only facilitating the process. Government will explore several options for potential investments. It is expected that the preparatory work for the AFZ would be completed by the end of this fiscal year.

Financial Stability Council

Mr Speaker, exposure to debt from bulk distribution companies, State-owned energy entities, as well as non-performing private sector loans continue to exert enormous pressures on the banking sector, posing a systemic risk to the entire economy.

A significant number of banks have capital adequacy ratios below the required 10 per cent, even after restructuring of the Volta River Authority (VRA) and Tema Oil Refinery (TOR) debts. To address this over the long-term, the Government would establish a Financial Stability Council that would be mandated, among others, to continuously assess the vulnerabilities affecting the stability of the financial system and provide oversight over the steps taken to avert these risks.

Mr Speaker, as a Government, we are committed to achieving a least cost power generation infrastructure through accelerated private sector participation. This would partly involve the restructuring of the power sector by bringing all hydrogenation, exclusively under the Volta River Authority (VRA) and create a separate thermal market. A new entity would hold the thermal assets which are currently held by VRA and make available a significant portion of this entity for private sector investment in pursuit of this private sector participation.

Ghana Infrastructure Investment Fund


Mr Speaker, in 2007, the then National Patriotic Party (NPP) Government announced its intention to set up what was to be the Ghana Investment Cooperation (GIC) as its principal sovereign wealth fund vehicle. In pursuing this, in April of 2008, the late Kwadwo Baah Wiredu presented a memorandum to Cabinet for approval to commence the processes of forming the GIC which was approved. A draft Bill was prepared but could not be passed before we exited Government.

Mr Speaker, Government intends to review the GIIF law to make it consistent with the original objectives of the GIC. This has become imperative, as we seek to take a more aggressive posture in leveraging the assets side of our balance sheet to create wealth to support the development of the country.

The GIC will manage the National Asset Protection Project (NAPP), a programme designed to conduct a fiscal and financial audit to locate, identify and value uncompleted Government assets.

International Financial Services Centre

Mr Speaker, the Banking Amendment Act, 2007, (Act 738), was passed to make way for the establishment of the International Financial Services Centre (IFSC). The purpose is to attract foreign direct investment income from licence fees payable in foreign currencies, create employment, enhance local skills knowledge and strengthen the financial sector through expansion in the use of investment banking instruments and to increase the general competitiveness of the financial sector.

Government would reactivate the process started by the Ministry of Finance and the Bank of Ghana as far back as 2007 to establish the International Financial Services Centre (IFSC) in Ghana.

Millennium Challenge Cooperation

The Ghana Compact II programme has officially come into force.

Both parties to the Compact, the Governments of Ghana and the United States of America (USA) are committed to complying with the obligations. As our President said, the implementation of Ghana's commitments has faced some challenges due to disagreements between stakeholders, particularly between Labour, ECG and the Millennium Development Authority (MiDA).

We need further dialogue on the key issues that have generated these disagreement. We are aware that these discussions should be concluded urgently, in order to arrive at the decisions that would allow for its implementation.

Mr Speaker, Government will reactivate the dialogue on the key issues that have generated these disagreements to ensure that, all concerns are adequately addressed and that the resolution would ensure the centrality of Ghanaian leadership in this transaction.

Education Fund

Mr Speaker, we will initiate discussions with all stakeholders interested in the performance and excellence of Senior High Schools (SHSs) in their communities. Parents, school alumni, religious organisations and the diaspora would be encouraged to establish a funding mechanism to support high schools of

their choice. This would reinforce community involvement in governance and improve the quality of education in our SHS. It is time we all participated in ensuring that Ghana's education regains its status of excellence.

Integrated aluminium industry

Mr Speaker, Ghana has since 1962 been contemplating the establishment of an integrated aluminum industry, using its natural resources in bauxite, hydro, gas and its existing smelter. The closest that the country got to realising this was in 2008 under President J. A. Kufuor. Thankfully, President Akufo-Addo has made the rapid and sustainable establishment of an integrated aluminium industry a top economic priority.

This is in line with his vision for industrialisation and transformation of the Ghanaian economy with a deliberate focus on value addition to the country's vast mineral wealth to significantly expand the capacity of the economy to create jobs and wealth for the people.

A lot of feasibility studies have been done in this area. The 2017 Budget seeks to revive this critical game changer and has accordingly made provisions to see to the implementation of an integrated aluminium industry. Development of the industry would require six main components.

First, the development of the bauxite mines which are located in Awaso, Nyinahin and Kyebi. Second, the establishment of a refinery at one of the bauxite sites, preferably in Kyebi, because of its close proximity to Tema, where the VALCO smelter is located.

The allocation of a dedicated, reliable and affordable source of power supply for the smelter. The development of a railway
Mr Ofori-Atta 12:45 p.m.

infrastructure between the mines and Tema. The conversion of the alumina to aluminium at the current VALCO plant. The establishment of an industrial park dedicated to manufacturing aluminium related products to complete the value chain of what is potentially a multi-billion local industry.

The President intends to introduce a Bill to this House this year to oversee the urgent development of this critical industry.

Fighting corruption

Mr Speaker, as we have said on several occassions,

“corruption holds back economic growth, increases the cost of doing business, reduces revenue to the State, leads to capital flight, and inflates the cost of running a government. It also results in a loss of legitimacy and respect for legally constituted authority.”
Mr Speaker 12:45 p.m.
Order! Order!
Mr Ofori-Atta 12:55 p.m.
Mr Speaker, permit me to assure that the Akufo-Addo Government is fully committed to respecting the integrity of contracts or may I say, contracts with integrity.

Mr Speaker, in this regard, Government would continue the implementation of the National Anti-Corruption Action Plan.
Mr Ofori-Atta 12:55 p.m.
Mr Speaker, this Government is committed to passing the Right to Information Bill as part of our tools in fighting corruption. We would not pay lip service to fighting corruption.
Mr Speaker, the center piece of this Budget Statement is to create an environment that would stimulate the private sector to create jobs, especially for the youth. It seeks to create an enabling environment to build the capacity of our youth, to take on more active roles in the country's future and its development.

Mr Speaker, Ghana will be 60 years in a few days, and there has been some debate as to whether it is worth celebrating this milestone, given the somber state of affairs. I believe we must. This anniversary provides us not only the opportunity to reflect, but also the challenge to chart a new and enduring course. Ghana is seen as a bastion of
Mr Ofori-Atta 12:55 p.m.
Mr Speaker, we have had three peaceful and successful transfers of power in the Fourth Republic. Our love for education and national character of friendliness and peace-loving set, us apart. Our economic challenges have, however, been the bane of our development aspirations. The policy actions spelt out in President Akufo- Addo's Budget Statement seek to give people greater socio-economic meaning to the gains of democracy.
Mr Speaker, we are ready to fix the economy and change the narrative -- [Hear! Hear!] -- to put the economy on the right path of phenomenal growth. We believe that this Budget Statement would sow the seeds for growth, jobs and the economic transformation agenda outlined in the vision of President Nana Addo Dankwa Akufo-Addo. [Interruption.]
Mr Speaker 12:55 p.m.
Mr Ofori-Atta 12:55 p.m.
Mr Speaker, I would want to emphasise that the President believes in value for money because he knows that we can achieve far more for Ghana even with what we have if we apply discipline, integrity and care for the public purse.
Mr Speaker, my job as the Hon Minister for Finance is to help the country to win this important battle, to protect and do far more for the public first with the little we have. And I pledge to do my best for the nation.
Mr Speaker, our Government, is a Government of destiny which will unite our people, and together, including all the
Hon Members in this Chamber, we will create a climate of social solidarity -- a society where the preferential option for the poor is at the core of a private sector led growth to transform our society and achieve social justice, inclusive growth and restore human dignity and prosperity for all citizens.
Mr Speaker, poverty is not natural. Our challenge as we sit in this hallowed hall is to liberate ourselves from a rigid and an unjust economic and political social system which we have helped to impose on our nation. The democratic dividends of prosperity and equity have eluded us and we must restore them.
Mr Speaker, this Government will take deliberate and strategic steps to fundamentally change the structure of this economy bequeathed to us 60 years ago, and we are committed to implementing the measures I have outlined. We would restore and sustain macro stability. We would provide the environment for private sector to grow and to thrive.
We would improve public services and tackle corruption, we would support small businesses in rural and deprived areas, we would ensure that every Ghanaian has equal opportunity and right to lead a productive and dignified life “being able to fully develop their God-given capabilities.”
Mr Speaker, our rural communities would begin to see a more purposeful and sustained efforts to transform their lives through the introduction of various district level, industrial and agricultural initiatives as well as improved education and health facilities and services.
Mr Speaker, I see our nation, with this overwhelming election mandate, as all having decided to withdraw in unison like our Lord Jesus, to a remote place, only to
Mr Speaker 12:55 p.m.
Hon Members, Order!
We would hear the Budget Statement in its totality -- facts, figures and also philosophy in the body--[Laughter.] -- and Hon Members, you would have your day.
Mr Ofori-Atta 1:05 p.m.
Mr Speaker, we only discovered that we have five loaves of bread and two fishes to feed our 25 million plus fellow citizens. But herein lies the genius of the Ghanaian, for we are God's handiwork created in Christ Jesus to do good works which God prepared in advance for us to do.
Mr Speaker, with five loaves and two fishes, President Akufo-Addo's Budget Statement has tackled the five structural pillars of revenue, expenditure [Interruption.] -- earmarked funds, labour, and our debts.
Budgetary allocations have been made from tax revenues, Annual Budget Funding Account (ABFA) and the realignment of the statutory funds to fund these priority projects. And we have done this through prioritisation of expenditures and planned improvement and efficiencies in Government's spending.
Mr Speaker, in addition to funding these significant number of programmes, we have allocated over GH¢700 million for CAPEX, seven times more than was allocated last year. We have funded NHIS and given free SHS. We have provided immense tax reliefs, including restoration of teachers and nursing training
Mr Ofori-Atta 1:05 p.m.
Mr Speaker, we have reduced levies on petroleum products — [Interruption.]
Mr Speaker 1:05 p.m.
Hon Members, Order!
Mr Ofori-Atta 1:05 p.m.
So, Mr Speaker, even with these limited resources, we have fully funded NHIS, we have given free SHS — [Uproar.]
Mr Speaker 1:05 p.m.
Mr Ofori-Atta 1:05 p.m.
We have provided tax reliefs for the private sector and all other socio-economic classes. We have reduced levies on petroleum products, reduced electricity levies, provided a stimulus for the private sector in industries, services and agriculture, and brought down the deficit from 8.7 per cent to 6.5 per cent. But that is not all; with the parable of the five loaves and two fishes that I have shared with you, we still have twelve baskets full of fishes and loaves yet to deliver to sow for the future for growth and jobs.
Mr Speaker, our aim is to restore hope and steer the country onto a sustainable and inclusive growth path. A country that is reenergised to redefine and reorient itself to confront the challenges ahead; a country in charge of its own destiny, a country where the private sector is well equipped to invest in the economy and be the catalyst of growth; a country where our youth have access to the requisite education which would expand their horizon and give them the opportunity to dream and dream big, and express their creativity, talents and ability; a country

Mr Speaker, let me take this moment, as we come to the end of this great privilege to present President Nana Addo Dankwa Akufo-Addo's first Budget to this august House, to reflect on one of the finest moments in our history of our democracy on 23rd July 1981.

Mr Speaker, as we all know, during the Third Republic, the country was in economic crisis under the government of the People's National Party (PNP). I am proud to say, that my father, Dr Jones Ofori Atta, in opposition in this House, with an amendment Motion co-sponsored by Dr G. K. Agama, successfully got this august House to amend the Motion to save the country in crisis.

Mr Speaker, we do have a crisis; it is a challenge. We can handle it, and I would call on the Hon Minority Leader, Hon Haruna Iddrisu, the Hon Deputy Minority Leader, Hon James Klutse Avedzi, the Hon Minority Chief Whip, Hon Mohammed- Mubarak Muntaka, the Hon Deputy Minority Whip, Hon Ahmed Ibrahim, the Hon Second Deputy Speaker, Hon Alban S. K. Bagbin and the Hon Ranking Members of the Finance Committee, Hon Cassiel Ato Baah Forson and Fifi Fiavi Franklin Kwetey to join us in this great example of the Third Republic, to salvage and build our economy together.

We believe, with the help of the Almighty God, we can deliver on the well thought out programmes and policies of President Akufo-Addo and build a business friendly and prosperous economy.

Mr Speaker, I would like to remind us of the State of the Nation Address when the President stated that the times in

which we live demand that we all be in a hurry to deal with the problems that we face.

Mr Speaker, Hon Members across the aisle, given the great precedent set by the Third Republic, I enjoin you to please join me in this debate, going forward, to enrich it.

Mr Speaker, we can do it. I personally pledge to work with you with candour, transparency, respect and an undying commitment on my part to protect the public purse. To the people of Ghana, I pledge to serve you and to ask for your prayers.

Mr Speaker, the Lord did not give us a spirit of timidity, but of power, love and self-discipline, and we must confront these problems.
Mr Speaker 1:05 p.m.
Hon Members, order!
Mr Ofori-Atta 1:05 p.m.
Mr Speaker, at this juncture, I beg to move, the “Asempa Budget” — [Hear! Hear!]
Hon Members on the Minority side — rose to sing.
Mr Speaker 1:15 p.m.
Thank you, Hon Minister for Finance, for your delivery.

Hon Members, in reference to the Order Paper and further to the Order Paper Addendum, is there any indication on the Presentation of Papers?

Hon Majority Leader?

At this stage, in accordance with Standing Order 140(3) and within such time as the Business Committee may determine, debate on the Motion shall stand adjourned for not less than three days.

It is also directed that parts of the Budget relating to the Ministries and constitutional bodies shall stand committed respectively to the Committees responsible for the various subject matters and Heads of the Estimates and to report accordingly further to Order 140


Furthermore, any part of the Budget relating to revenue and expenditure shall stand committed to the Committee on Finance in accordance with Order 140 (5).

Hon Majority Leader, any indication both in terms of the Order Paper and the Order paper Addendum?
Mr Osei Kyei-Mensah-Bonsu 1:15 p.m.
Mr Speaker, we have exhausted the agenda as captured on the Order Paper but there is an Order Paper Addendum on which has been captured Papers, that are to be presented in the House and would accordingly, be done by the Hon Minister for Finance.
Mr Speaker, you may allow for the presentation of the Papers so stipulated on the Order Paper Addendum.
Mr Speaker 1:15 p.m.
Papers to be presented accordingly.
PAPERS 1:15 p.m.

Mr Kyei-Mensah-Bonsu 1:15 p.m.
Mr Speaker, the principal activity for today, as programmed, is the presentation of the Budget Statement and Government Financial Policy to the people of this country through Parliament, and we have indeed, done that. The Hon Minister for Finance, in accord with article 179, has submitted to this House, a Budget that sets out to reposition Ghana on the path to real sustainable development, and which sowed the seed to secure for ourselves and posterity the blessings of liberty, equality of opportunity and prosperity.
Mr Speaker, what else can the nation expect from a Budget -- [Hear! Hear!] -- that indeed, is the anticipation of the entire country?
Mr Speaker, I do not believe that this calls for a discordant chorus, as such that, this nation has witnessed. We would stand the debate down until the appropriate time, and I believe justice would be done to -- the people of this country, after the dissection, would know what is in the belly of this Budget.
Mr Speaker, on that score, I beg to move, that this House adjourns proceedings until tomorrow, ten o'clock in the forenoon.
Mr Haruna Iddrisu 1:25 p.m.
Mr Speaker, I beg to second the Motion for adjournment as moved by the Hon Majority Leader, and suffice it to remind him and the Hon Minister for Finance that, when he was concluding, even though he began with a Motion that this Honourable House approves the Financial Policy of the Government of Ghana for the year ending 31st December, 2017, he concluded with; “I beg to move the “Asempa Budget”, not the Ma tricki wo Budget and not to the Motion he submitted himself.
Mr Speaker, I know that, you have been affected by ‘I am in a hurry' -- [Laughter.] --and you wanted many of these issues to -- Again, the Hon Minister for Finance, in seconding the Motion, when he comes to this House of record, and uses words such as; “we have reduced the petroleum taxes, we have reduced the Budget deficit” -- [Interruption.] The Hon Minister for Finance is before Parliament, and it would be honourable if he said that, in this Budget, ‘we have pledged to reduce' but not definite that “we have reduced” [Uproar.]
Mr Speaker, we may take this for granted, but that kayayei who wants to enjoy the tax relief as announced by the Hon Minister for Finance, and the spare parts dealer at Abossey Okai, may ask for the relief in the next possible one hour. [Laughter.] But the best assessment of a Budget is not in its delivery, but in its outturn.
We would monitor the outturn of the performance of the Budget, and while I second the Motion, I want to assure him that he has not reduced anything yet. It is subject to legislative reforms in this House
Mr Kyei-Mensah-Bonsu 1:25 p.m.
Mr Speaker, I thought what the Hon Minister meant was that, the document that he has delivered to us contains these anticipations. So, he has sought to -- [Uproar.]
Mr Speaker, people are eager to criticise but do not have the patience to listen. That is why the difference between ‘us' and ‘them' is known to every Ghanaian. The way they are conducting themselves does not inure to the integrity of this House. It does not.
I would want to believe that the Question would be put and then we would debate the issues. I am happy that the Hon Minority Leader admits that the quality is in the outturn and not just in the delivery, which should suggest to all of us that, he is convinced and persuaded that, the right thing has been done. [Hear! Hear!] [Interruption.]
Mr Speaker 1:25 p.m.
Mr Haruna Iddrisu 1:25 p.m.
Mr Speaker, -- we know that rightly, and pursuant to our Standing Orders, you are deferring debate and suspending it, but within nine days, the fiscal deficit has changed from 9 to 8.7 and the debt to Gross Domestic Product (GDP) has changed from 74 to 73 -- He is not here in his own Capacity. [Laughter.]
Mr Speaker 1:25 p.m.
Question put and Motion agreed to.

  • The House was accordingly adjourned at 1.32 p.m. till Friday, 3rd March, 2017, at 10.00 a.m.
  • BUDGET STATEMENT 1:32 p.m.


    ACLP 1:32 p.m.





    DEVELOPMENTS 1:32 p.m.


    MONETARY SECTOR 1:32 p.m.



    MEDIUM TERM 1:32 p.m.


    REAL SECTOR 1:32 p.m.


    FISCAL SECTOR 1:32 p.m.

















    ECONOMIC SECTOR 1:32 p.m.


    COCOA SECTOR 1:32 p.m.






    AND INNOVATION 1:32 p.m.

    MINISTRY OF ENERGY 1:32 p.m.









    SOCIAL SECTOR 1:32 p.m.




    MINISTRY OF HEALTH 1:32 p.m.






    DEPARTMENT 1:32 p.m.



    JUSTICE 1:32 p.m.

    JUDICIAL SERVICE 1:32 p.m.













    JOB CREATION 1:32 p.m.

    CONCLUSION 1:32 p.m.

    SPACE FOR APPENDICES - 1:32 p.m.