A news desk report
Private legal practitioner Jonathan Amable has formally requested an expedited hearing from the Supreme Court regarding a constitutional injunction application filed against government that seeks to address concerns over alleged unconstitutional borrowing practices, which have sparked questions about fiscal governance and adherence to the 1992 constitution.
In a letter dated December 10, 2004 through his lawyers – Heward-Mills & Co Dantu Chambers – the plaintiff emphasised the matter’s urgency, urging the Supreme Court Registrar to prioritise this case.
“The 14-day period (for notifying the Respondent) expired on 27 November 2004. We humbly request fixing the hearing date for the application and any other processes filed in the matter at the earliest available sitting on an urgent and expedited basis,” the letter stated.
The interlocutory injunction application centres on government’s borrowing activities, which the plaintiff contends violate Article 181(4) of the constitution. The article mandates that all terms and conditions of government borrowing must receive parliamentary approval.
According to the letter, “The Government has, by its failure to respond to the substantive matter… and its continued borrowing, evinced an intention to continue borrowing in breach of the mandatory terms of article 181(4)”.
Mr. Amable detailed the economic and constitutional ramifications of government’s borrowing activities, highlighting the ballooning public debt and potential for long-term economic harm.
“The continued borrowing operations of government are increasing the public debt of Ghana – details of whose payment may fall on the citizens of Ghana through an increase in the rate of existing taxes, introduction of new taxes and, ultimately, restructuring of the accrued debt,” the letter noted.
Since the injunction application was filed, government has borrowed an aggregate of GH¢208illion and reportedly intends to borrow further, the letter claimed. The firm argued that the lack of parliamentary approval renders these borrowings constitutionally questionable – raising concerns about their enforceability and potential economic fallout.
While the plaintiff has not sought an order to invalidate existing Treasury bills or securities issued without parliamentary approval, the letter emphasised broader implications for governance and public trust.
“The probability that Treasury bills – and any other debt securities – may be declared unconstitutional and unenforceable in any subsequent constitutional enforcement action creates an urgent need to protect the national interest,” the letter stated.
The lawyers stressed that government’s borrowing powers, while constitutionally granted, are not absolute. “The borrowing powers of a juristic person are conferred on it by its constitutive documents… and, where granted, a juristic person must exercise its borrowing powers strictly in accordance with the limitations in its constitutive document,” the letter explained. Government’s actions, they argued, contravene these principles and must be addressed immediately.
The lawyer – who specialises in corporate and public finance legal advisory services transactions – contends the issue is a matter public interest, while underscoring the judiciary’s role in upholding constitutional mandates.
“Government’s failure to adhere to these limitations is a grave matter of public interest which must be rectified urgently through an expedited hearing of the injunction application,” the letter asserted.
As of October 2024, Ghana’s public debt stood at GH¢761billion, a 5.8 percent decline from the GH¢807.8billion recorded in September 2024, according to latest data from the Bank of Ghana.
This put the debt to GDP (Gross Domestic Product) at 74.6 percent.
In dollar terms, the total debt stock amounted to US$46.8billion during the review period; down from US$51billion in the previous month.
Despite the month-on-month decline, there was an increase of GH¢175billion in public debt compared to the same period for 2023, with external debt accounting for GH¢453.7billion (US$27.9billion) while domestic debt stood at GH¢307.3billion.
Analysts are estimating that government will borrow approximately GH¢200billion from the T-bill market in 2025 compared to the projection of GH¢220billion for 2024. This corresponds to an average weekly uptake of GH¢3.9billion in 2025, down from GH¢4.2billion in 2024.
It is anticipated that with improved access to international funding and key macroeconomic indicators signalling sustained recovery, government will shift toward longer-term financing options.
However, they have warned that this transition will likely take place after the first quarter of 2025 as short-term funding demand is expected to remain high – due to Treasury refinancing needs and maturities from elevated borrowing levels in the second half of 2024.
