Non-performing state institutions burden public funds – Domelevo

Former Auditor General Daniel Domelevo has observed that non-performing state institutions are draining the public funds.

The anti-corruption crusader was contributing to discussions at an event By IMANI Centre for Policy and Education in Accra on October 23.

The discussions followed a presentation on a recent research report by IMANI Ghana which ranked the Ministry of Finance as the most fiscally reckless among all Ministries, Departments, and Agencies (MDAs) from 2015 to 2023.

“The tendency in Ghana is that we establish state institutions and they are also a burden on the same public funds. They don’t perform, then we create another one. In my considered opinion, the Attorney-General, the Auditor-General, the Director-General of Internal Audit Agency and Public Accounts Committee, these institutions, we should wake them up,” Mr Domelevo stated.

According to IMANI’s findings, this poor fiscal discipline has contributed to Ghana’s rising debt levels and economic instability.

“The Ministry of Finance tops the list of MDAs as the most fiscally reckless institution between 2021 and 2023. The Ministry of Finance recorded an FRI score of 0.9038, which translates to about 90 per cent of financial infractions traced to the Ministry of Finance. The Ministry of Finance is followed by the Ministry of Communication, the Ministry of Roads and Highways, the Ministry of Health, and the Ministry of Food and Agriculture as the top five fiscally reckless institutions for the period of assessment,” a Senior Research Associate at IMANI Centre for Policy and Education, Dennis Asare said.

Mr Domelevo noted, “Let me be honest with you, if they are up and doing, the Ministry of Finance itself will repent. In 2021, I targeted the Ministry of Finance, surcharging the Minister of Finance and his Chief Directors. and I think that would have brought discipline.”

The study by IMANI CPE, highlights the Ministry’s repeated budget overruns, excessive borrowing, and mismanagement of public funds during the period under review.

Imani Ghana therefore recommended, among others, the setting up of an Independent Fiscal Council.

“Establish and legislate an Independent Fiscal Council by amending the Fiscal Responsibility Act 2018 (Act 982). The historical trend of fiscal recklessness evidenced by the positive growth in financial irregularities lay credence to the fact that the existing accountability measures in the PFM system have failed to reduce the infractions by MDAs, and thus there is the need for an independent body with the oversight over government financial decisions,” IMANI CPE recommended.

It explained that “The independent fiscal council must be clothed with the power to oversee and stop some of the fiscal decisions of the government and MDAs. In addition, the independent fiscal council must have the power to oversee all the big-ticket expenditure items of the government and supervise the macro-fiscal planning activities of the Ministry of Finance. This can potentially minimize the incidence of overstatement revenues by MDAs leading to tax and cash irregularities, where MDAs have to withhold expected government revenues to undertake some of their budgeted activities.

However, Mr Domelevo held a contrary view.

“I agree with you that we should ensure indiscipline comes down, but I don’t think it is in creating another burden on the consolidated fund. We have done that too often. So, let’s look at the mandates that already exist and see whether it cannot be executed within the mandates, so that it will be cost beneficial,” he opined.

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