Little common sense steps to improve the well-being of all (II)

  • making poverty alleviation focus of district and municipal assemblies

A key to change in livelihood improvement of the rural areas and significant part of Ghana is the reform of local government administration. Key recommendations are:

  • Making the abolishment of poverty as the paramount job description of MMDAs and their respective heads. There are numerous experiential leaning curves to copy from Brazil, China and India.
  • Break down of the country’s GDP down to districts/municipal assemblies and regional figures. Such breakdowns should indicate the drivers of the local economy such as sectoral analysis and attendant figures.
  • MMDAs/Regional Ministers given targets to improve upon MMDA GDP numbers. This is possible. If banks could give targets in rural deprived communities for branch staff to hit targets in KPIs, MMDA could easily do so.
  • KPIs of MMDCE/REG MIN to cover micro and macro aspect of the country under their jurisdiction.
  • Organiee quarterly Management Performance Reviews for MMDCE’s and regional ministers to drive performance toward KPIs.

General statutory recommendations

  • Statutory limits on number of ministers and advisers. This helps control executive expenses, and leaves fiscal space for expenditure on the poor.
  • Statutory limits on government expenditure as against government revenue. Debt ceiling in proportion to our revenue capacity and requisites caveats to exceed if only urgent and highly necessary etc. Such measures are to control the limitless borrowings and self-interest beneficial projects as against the national interest and our debt service capacity.
  • Making road grading and reshaping a quarterly exercise for Feeder Roads Department and district assemblies to alleviate rural hardship and difficulties, especially in agro produce transportation, etc. As always stated, we have huge infrastructure deficits, but limited capacity to close the gap. Pragmatic step is to constantly reshape roads with graders to make them motorable. Government has not got the means to construct asphalt roads (Ghana needs circa US$1trillion to asphalt all our roads – which we don’t have). MMDA have graders already and Parliament could legislate quarterly funds for diesel for every MMDA to grade all country roads quarterly. The multiplier effects of such a policy will be enormous in terms of food produce availability, food prices affordability, increasing internal trade, etc. This policy is an improvement on constant political promises by all parties to chiefs, etc. to construct their roads – which never happens.
  • Establishment of a Charity Commission to guide the regulation and taxation of churches. The present religious system practised across the world is far modernized from the medieval European times when churches were non-taxable. Our charity commission must be rigid and far stringent than the UK and western-oriented ones looking at our peculiarities. It’s not Rocket Science that churches and religion are big businesses now. We don’t need Einstein to discover these trends. The state is hemorrhaging on unsustainable debts and adequate taxation of business enterprises. The Registrar-General, Attorney-General, and GRA must coordinate to organise these very well to close all loopholes in setting up the commission and designing tax schemes for churches and all religious buildings/entities. This is a very controversial recommendation but, I tell you, the revenue the state is losing from this is mind-blowing. The Church of England produces their annual AFS; where are ours? In my 45 years on earth, I have never seen in the dailies AFS of any major church. Most of the buildings of schools we have were built in colonial times (I stand to be corrected), so what does the church use their funds for?
  • The central bank could also adopt the Indira Gandhi (Former Indian PM) Indian banking model where financial institutions are allocated compulsory percentages profile of their assets/investment in various economic sectors. India has central bank laws that govern let’s say a bank’s asset profile covering sectors/industries ranging from primary agriculture, agric business and various industries. The percentages profile depends on the priority of the government. We can’t have a solid economy where services, SME importations consume most bank assets and we cry about huge import bills for rice, frozen foods, oil, sugar, etc. The essence of government is to wield power to the benefit of the citizens of the geographical space, and not to the interest of a few. Banks’ investments in primary agriculture must be mandatory. My main motivation for recommending this compulsory asset allocation is that lending to the primary agriculture sector is very weak. I understand the risk involved based on my credit risk evaluation experience in a typical agri-biased institution; but if the nation does not encourage risk taking in this angle, the nation’s high import bills for basic commodities we can grow here will keep increasing. The more risks are encouraged in primary agriculture, the more our learning curve improves to manage the risk better.

Kwamina is an experienced financial and credit analyst with over 10 years in advanced commercial lending and bankside experience.

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