20 January 2017

Unnecessary cancellation of contracts creates judgment debts

Government has been cautioned to guard itself against the abrogation of already existing social intervention contracts without recourse to the implications of such a decision.

With reference to contracts with caterers who cook for the Ghana School Feeding Programme (GSFP), some policy analysts believe that a hasty move to end some of the contracts which they signed with the previous administration will have implications, including judgment debts which are a drain on the country’s meager resources.

In an interview with the GRAPHIC BUSINESS in Accra on the new government’s promise of numerous social development reforms, the Country Director of SEND Ghana, a non-governmental organisation, Mr George Osei Bimpeh, said government must be cautious to address systematic challenges within the confines of the law.

“Government shouldn’t rush into fulfilling those promises, and of course there will be a backlash but that is the price for taking a decision with a long-term view from short-term one.I expect a paradigm shift in terms of thinking and policy making in this country,” he said.

Some of the major social protection programmes (SPPs) being implemented currently include the Livelihood Empowerment Against Poverty (LEAP), the Ghana School Feeding Programme (GSFP), the National Health Insurance Scheme (NHIS) and the education capitation grants.


There have been mixed reactions by some Civil Society Organisations (CSO) on the new government’s promise of numerous social development reforms, a cardinal one on how to revamp the NHIS which some research showed challenges with respect to acquisition of prescribed medication, delayed in payment of bills; for which people claimed it was not working well.

Mr Bimpeh said the budget should look at how to address the systemic challenges in the management of the NHIS to reignite people’s confidence in terms of its acceptability and also assure facilities of prompt payment to ensure their capital is not locked up.


The GSFP at its inception was sponsored by development partners but is now fully funded by the government and the number of beneficiaries has gone up exponentially.

Therefore, he said the government was expected to indicate how it would continue to fund it from its coffers, coupled with reports of leakages; people conniving to inflate numbers.

“How will they block those leakages so that we deliver some of these social interventions in an atmosphere where we get value for money and also stop all the practices that contributes to corruption in the management of the school feeding programme,” he said.

However, he said it was also important to give the government at least 100 days to settle in to study the system well to get a good understanding of what the status quo is.

New government’s social development agenda

It will review and restructure the sources of funding, as well as the institutional arrangements for the management of the National Health Insurance Fund (NHIF), increase budgetary allocations to the NHIS, refocus the LEAP, institute measures to reduce administrative cost of the GSFP to the barest minimum and stimulate local agricultural growth by requiring caterers to buy and use foodstuff grown locally from local farmers.

It will also set aside 50 percent of Microfinance and Small Loans Centre (MASLOC) funds for female applicants.


CSOs have questioned the feasibility of the new government’s proposed development reforms.

A Policy Analyst at the Integrated Social Development Centre (ISODEC), Mr Leonard Shang-Quartey, said the question of feasibility proposals have come up because the citizenry seems to lower the standards for elected representatives.

“Some of these promises are feasible and are achievable. I don’t think of them as out of reach. This push should have been coming from civil society and citizens.  We are in the business of continuously pushing barriers for us to have the world that we seek,” he said in an interview in Accra.

Mr Quartey said the push for such reforms should have come from citizens and so was refreshing that some political parties were having discussions on that.

Restoration of teacher trainee allowances

Mr Quartey said they as CSO were against the abolition of the allowances and saw it as one of many steps to reducing government’s responsibility to the social sector.

He said such allowances should be seen as an investment towards the production of teachers we need and so a contribution to bring quality education in the public sector, but not as undue burden.

“As a developing country, we need that sense of urgency that we cannot defer our development because deferring some of these issues will mean that some citizens will miss out on opportunities that they need to turn their lives around,” he said.

Mr Bimpeh cautioned the government about rushing to fulfill and said it tread cautiously about the sustainability of the allowances.

According to him, the challenge had been the improper targeting mechanism although there may be genuine students who require that kind of allowance.

“Otherwise, if we need to put in place the necessary legislation as the former government attempted that is a more sustainable way so as to ensure that we do not curtail the number of people who gets access to college of education because they are unable to pay. I want to believe they will be guided by some of these lessons,” he said.

He said the reality of funding of the Sustainable Development Goals will depend on the country’s ability to mobilise resources and utilise them judiciously in a wise manner.

“The current tax system is too regressive and not good for economic growth and redistribution of income so the government will need to look at the tax regime and make it more flexible. Any talk about social intervention should look at the tax regime to cushion the have nots,” he said.

Pro-poor activities

Total government spending on pro-poor activities for 2016 was estimated at GH¢8,754.13 million, representing 22.97 per cent of GH¢38,611.44 million total government expenditure.

Out of a total budget for 2015 of GH¢34,402.43 million (which excludes tax expenditure and foreign –financed capital expenditure), an amount of GH¢7,594.34 million representing 22.08 per cent was earmarked for poverty-reduction activities.

By the end of September 2015, a total of GH¢5,290.87 million had been spent, representing 24.18 per cent of the total government expenditure of GH¢21,884.32 million.

Source:Graphic Online

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