Former Auditor-General Daniel Domelevo has emphasized the need to empower public auditing institutions to address fiscal irresponsibility in ministries, departments, and agencies (MDAs).
At the launch of the third Fiscal Recklessness Index 2024 report by IMANI Africa and Oxfam Ghana, Mr Domelevo argued that creating an Independent Fiscal Council without first strengthening existing institutions would only increase the financial burden on the state.
The report identified the Ministry of Finance as the most fiscally reckless institution.
Mr Domelevo took this opportunity to stress the importance of strengthening oversight bodies, such as the Public Accounts Committee and the Internal Audit Agency, to improve financial accountability and governance across public institutions.
“The tendency in Ghana is to establish new state institutions that ultimately become a burden on public funds. When they fail to perform, we create yet another one.
“In my view, we should strengthen the Attorney-General, the Auditor-General, the Director-General of the Internal Audit Agency, and the Public Accounts Committee,” Mr. Domelevo stated.
Meanwhile, Finance Minister Dr. Mohammed Amin Adam has announced the government’s plan to establish an independent fiscal council aimed at ensuring Ghana does not borrow beyond its financial capabilities.
This initiative is a crucial step toward reinforcing fiscal responsibility and stabilizing Ghana’s economic outlook, particularly in light of the recent domestic debt crisis.
At the 2024 Annual Meetings of the International Monetary Fund (IMF) and the World Bank Group on October 23, Dr. Amin Adam highlighted the significance of this initiative in maintaining sustainable debt levels and preventing a recurrence of Ghana’s previous debt challenges.
He explained that the proposed fiscal council will be an autonomous body responsible for monitoring government borrowing practices and enforcing adherence to newly established debt limits.
Operating independently from government control, the council’s primary role will be to ensure compliance with fiscal rules, particularly regarding borrowing and debt repayment.
“The domestic debt we did was a very painful exercise because people did not expect that. So to have taken the people of Ghana through this painful exercise has meant that they had to sacrifice beyond what many people could do. And because of that, they are demanding fiscal discipline, they are demanding fiscal stability, and that is why it will be very difficult to go back to the era of unsustainable debt.
“The second measure we are putting in place is the implementation of far-reaching structural reforms, you know, to build our resilience. And one of the structural reforms relates to the existing fiscal responsibility legislation to impose debt limits on ourselves.
“And we are also putting in place a fiscal council that will ensure compliance with the fiscal rules. The fiscal council is supposed to be an independent council which will, outside the government, monitor our progress in terms of debt management in terms of how much we borrow, and how we repay, to ensure that we do not go beyond the limit that we are imposing on ourselves.”