Ranking Member on Parliament’s Finance Committee, Cassiel Ato Forson, has accused government of deliberately worsening the plight of Ghanaians due to its refusal to access the Debt Service Suspension Initiative put together by the International Monetary Fund (IMF).

He said the Akufo-Addo-led government failed to access this initiative because it lacks the ability to maintain fiscal discipline.

This initiative, he said would “have seen our debt service suspended to give us much-needed breathing space and channel the savings into critical expenditure” but rather government chose to “overspend in order to win the 2020 elections.”

Speaking on Tuesday during the debate on the 2022 Budget and Economic Policy Proposal, Dr. Forson noted the Ghanaian economy is in a deplorable state and is currently in the Intensive Care Unit (ICU).

The Member of Parliament for Ajumako-Enyan-Esiam indicated that the country is suffering from Stagflation with Acute Debt Overhang Syndrome (SADOSES) due to “slow and jobless” growth.

“As at September, 2021, Ghana’s Total Public Debt stood at GHC341.8 billion of which GHC221 billion, representing 65% of GDP have been accumulated in the last four and half years. According to the 2022 budget, between January- September, 2021, the Government of Ghana collected GH₵37 billion in Tax Revenue (App 2A, pg. 227), of which 92%(GH₵34.4 billion) was used for debt servicing alone – interest payment (GH₵25.4 billion) amortization (GH₵9 billion). This clearly is a case of an acute debt overhang,” he stated.

According to him, government has decided to treat the malaise with home grown policies instead of visiting the International Monetary Fund (IMF). However, interventions by government in its budget are not credible and realistic.

He said government has introduced tax policies such as the E-levy in an attempt to deal with the debt overhang.

The imposition of the E-levy, Dr. Forson said will discourage the much-needed remittances that have become the life wire of Ghana’s struggling cedi.

“Remittances have contributed immensely to the growth of the Ghanaian economy. Any attempt to tax it will discourage Ghanaians in the Diaspora from using the formal channels of transfer and encourage underground activities in the remittances market. It would also discourage Foreign Direct Investment (FDI),” he further added.

The MP for Ajumako-Enyan-Esiam also predicted the emergence of a cash economy should the e-levy, that seeks to tax bank transfers be approved by the House.

Again, Dr Forson noted that unbearable hardship will befall citizens if government succeeds in taxing mobile money transactions.

“Mr. Speaker, I beg to say that this E-Levy will introduce more inefficiencies in the Ghanaian Economy than ever,” he stressed.

He therefore requested that immediate attention be given to the current state of the economy or risk having it admitted at a Highly Intensive Care Unit (HICU).