Minister for Parliamentary Affairs Osei Kyei-Mensah-Bonsu, who is standing in for Minister for Finance-designate, Ken Ofori-Atta, has announced a government scheme worth GH¢100 million to help Ghanaians to pay rent advance and have decent accommodation.
It will be called the National Rental Assistance Scheme (NRAS) and is expected to provide low-interest for those who will have access to the fund.
Delivering the 2021 Budget Statement and Economic Policy of the government yesterday, the Majority Leader said “Mr. Speaker, in partnership with the private sector, we will commence the establishment of a National Rental Assistance Scheme (NRAS), with a seed of GH¢100 million. The scheme will crowd-in additional investment from the private sector, to provide low-interest loans to eligible Ghanaians to enable them pay rent advance.”
The Majority Leader admitted that the country’s debt stock is rising but also said the prudent management of the situation was what was keeping the economy going strong.
According to him, “The total public debt has increased from GH¢122 billion, which is 69% of GDP to GH¢291.6 billion, which is 76.1% of GDP, as of the end of December 2020.”
He said the ballooning debt stock was as a result of what he called “non-recurrent burdens,” and indicated that if those expenditure were to be excluded, the debt stock would have been around GH¢239.9 billion, which would have been 58.7% of GDP instead.
“Included in the debt stock and the debt to GDP ratio are the following non-recurrent burdens that we had to deal with as a matter of urgency; the physical impact of COVID-19, which is GH¢19.7 billion, the cost of the financial sector clean-up, which is GH¢21 billion and the cost of excess capacity charges paid to IPPs, which is also GH¢12 billion,” he said.
“If these expenditures are excluded and the drop in GDP growth in 2020, primarily attributable to COVID-19, is taken into account, the total stock of debt for 2020 would have been approximately GH¢239.9 billion, implying a dent to GDP ratio of 58.7%.”
He said although the COVID-19 pandemic derailed many plans of the government, it had been able to undertake a number of activities that ensured that the country could now recover immediately.
“Despite the impact of the COVID-19 pandemic, the rate of growth of the public debt has been lower under our government than under previous governments. The rate of debt growth was also slower under our government despite investment in our flagship programmes such as Free SHS; Planting for Food and Jobs; NABCo; One District, One Factory; One Village, One Dam; One Constituency, One Ambulance, and the restoration of the allowances for trainee teachers and nurses among other things, while maintaining macroeconomic and exchange rate stability.”
“This reinforces the fact that the Akufo-Addo government and indeed the NPP are simply better managers of the economy and better protectors of the public purse,” he said.
“Mr. Speaker, pursuing the GH¢100 billion Ghana CARES Obaatan pa programme allows us to address the challenges and also seize the opportunities created by COVID-19 for socioeconomic transformation. This programme will foster closer collaboration with the private sector, labour, faith-based organizations and development partners to complement efforts in the revitalization and growth agenda,” he said.
He said debt growth had been slower under the Akufo-Addo-led NPP administration despite the massive investments made into social intervention programmes and the impact of the COVID-19 pandemic.
He said the economy had become more attractive to foreign investors after the financial sector cleanup, and many jobs had been created as businesses were flourishing.
“The banking sector clean-up has been completed, businesses were doing well and creating jobs…and suddenly Ghana has become a major tourist attraction,” he added.
He however admitted the COVID-19 pandemic had retarded progress, saying, “We were indeed on a part of fiscal consolidation by 2019 and poised for economic transformation, then out of nowhere the COVID-19 pandemic hit us. Mr. Speaker, the history of Ghanaians is a story of resilience, faith in God and ingenuity when faced with adversities and uncertainties.”
He assured that the roads under the government’s Sinohydro Agreement would be completed in 2021.
According to the Majority Leader who is the NPP MP for Suame in the Ashanti Region, most of the roads under Phase One of the deal are at various stages of completion and the Akufo-Addo administration is determined to fix the bad roads.
“Mr. Speaker, President Nana Addo Dankwa Akufo-Addo in the presentation of the State of the Nation’s address declared 2021 as the second year of roads. Mr. Speaker, with this declaration we will continue the prioritization of road construction. The government will continue to pursue the following ongoing projects that are at various stages of completion under the Sinohydro master facility,” he said.
He said that the Akufo-Addo administration’s GH¢100 billion Coronavirus Alleviation and Revitalization of Enterprise Support (CARES) initiative, is the biggest singular financial investment ever made by any government in Ghana’s history.
“Pursuing the GH¢100 billion Ghana CARES Obaatan pa programme allows us to address the challenges and also seize the opportunities created by COVID-19 for socioeconomic transformation. This programme will foster closer collaboration with the private sector, labour, faith-based organizations and development partners to complement efforts in the revitalization and growth agenda,” he said.
He said the initiative was inspired by President Akufo-Addo’s conviction that “what our forebears dreamed of, we will achieve,” adding that “if we inherited dreams and visions from our founding fathers, we should leave legacies of achievements and realities to our children and their children.”
He said the Ghana Cares Programme was aimed at expanding commercial agriculture and attracting educated youth into agriculture; building Ghana’s light manufacturing industry, targeting agro-processing, food import substitution, textile and pharmaceuticals; developing engineering, machine tools and ICT digital economy industries; fast-tracking digitization by expediting the government’s digital initiatives; developing Ghana’s housing and construction industry; and establishing Ghana as a regional hub, leveraging its position within ECOWAS and as host to the Secretariat of the Africa Continental Free Trade Area (AfCFTA) by focusing on manufacturing, finance, mining, healthcare, aviation and logistics, digital services, petroleum, automobile, tourism, hospitality and creative arts.
According to Mr. Kyei-Mensah-Bonsu, the 2021 budget will ensure economic recovery and macroeconomic stability through the rolling out of well-thought-through measures that will set the economy back in motion.
“Under President Akufo-Addo’s leadership, we took the required swift, drastic and decisive measures to mitigate the spread of the pandemic. We rapidly mobilized and deployed extensive internal and external resources to support Ghanaian households and enterprises.”
“Mr. Speaker, we are now better positioned to recover and build back a more resilient economy not only because we know how to do it but also because the Grace of God has been assured for this journey,” he said.
Vice President Dr. Mahamudu Bawumia, head of the government’s economic management team, and his economics gurus were in Parliament House to support the Majority Leaders to deliver the budget statement.
By Ernest Kofi Adu