IMF: Absence of COVID-19 audit could bite – Gatsi

Analysis of Interest Payment Burden and Debt Sustainability (2017-2021
Prof. John Gatsi

Failure of government to adequately audit the receipts and expenditure attributable to COVID-19 could come back to bite in negotiations with the International Monetary Fund (IMF), Dean of the University of Cape Coast Business School, Professor John Gatsi, has said.

The nation’s pandemic funds have been shrouded in controversy, with official figures from key persons — the President, his Vice and the finance minister — all varying. This has only intensified suspicions by the political opposition and Civil Society Organisations (CSOs) that the funds have been misappropriated.

This comes after the IMF, at the conclusion of its Article IV Consultation with Ghana in 2021, encouraged the timely completion of the planned audit of COVID‑19 emergency spending and new expenditure arrears.

As negotiations begin today between the central government and the Bretton Woods institution on a suitable programme, Prof. Gatsi believes the irregularities will serve as a sticking point.

“Given the fact that IMF indicated that government should do a COVID-19 audit, and that has not been done. That could prove problematic.”

President Akufo-Addo, during the State of the Nation Address (SONA) this year, said the sum of GH¢17.7billion – 4.6 percent of Gross Domestic Product (GDP) – has so far been spent on containing the COVID-19 pandemic since its advent in 2020.

In contrast, presenting the statement to parliament on the COVID-19 expenditures for 2020 and 2021, Finance Minister Ken Ofori-Atta, disclosed that to mitigate the impact of the pandemic on businesses and households, and to ensure that economic activities recover, and minimise job losses, government mobilised GH¢18.19billion out of the programmed GH¢19.3billion in 2020 from various funding sources.

However, for the years 2020 and 2021, the programmed expenditure amounted to GH¢15.76billion for the COVID-19-related expenditures out of which the actual utilisation was GH¢12.04billion.

The minister noted that in 2020, a total amount of GH¢11.16billion was programmed for COVID-19-related expenditure, although only about GH¢8.12billion was utilised. The amount was utilised to provide support to households; supply equipment and provide relief to health workers (Health Response); health infrastructure; security operations, evacuations, quarantine and coordination; economic relief; stabilisation and revitalisation; and COVID-19 complementary releases.

In 2021, an amount of GH¢4.6billion was programmed in the 2021 Budget for COVID-19-related expenses, yet at the end of December 2021, total utilisation was GH¢3.91billion, representing 85 percent utilisation.

“I wish to dispel the notion that there have been inconsistencies in government data on COVID-19. The President intimated during the State of the Nation Address on 30th March, 2022 that we had mobilised about GH¢17.7billion since 2020 to fight the pandemic. We have subsequently reconciled the data and I can report that as of end-May, 2022, we have mobilised GH¢18.19billion to mitigate the effect of the pandemic,” Mr. Ofori-Atta remarked.

“Again, when the Vice President indicated on 7th April, 2022 at the National TESCON Conference that government had spent GH¢8.1 billion on COVID-19, it was within the context of expenditures for 2020,” he added.

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