Frank Annoh-Dompreh
The Minority in Parliament has raised concerns over the Bank of Ghana (Amendment) Bill, 2025, warning that a new provision requiring the Central Bank to jointly determine the medium-term inflation target with the government poses a direct threat to the Bank’s independence.
At the heart of the Minority’s objection is the express introduction of Section 3 of the amendment bill, which states that “the Bank of Ghana shall determine the medium-term inflation target jointly with the Government.”
Minority MPs argued that this provision represents a significant departure from established central banking principles and risks exposing monetary policy to undue political influence.
During debate on the bill, Minority members insisted that inflation targeting is a core mandate of the Central Bank and should remain solely within the professional and technical domain of the Bank of Ghana.
They cautioned that allowing the Executive to jointly determine inflation targets blurs the critical line between fiscal policy, which is the responsibility of the government, and monetary policy, which constitutionally rests with the Central Bank.
The Minority Chief Whip, Frank Annoh-Dompreh, and the MP for Nhyiaeso, Dr. Stephen Amoah, questioned the true intent behind the new provision, warning that it could weaken the functional autonomy of the Bank of Ghana and undermine investor confidence.
They argued that the Central Bank’s independence is essential for controlling inflation, maintaining price stability and safeguarding the long-term health of the economy.
Similarly, the MP for Effia, Isaac Boamah-Nyarko, described the provision as dangerous, stressing that once the government becomes a joint determinant of inflation targets, political considerations could override sound economic judgment.
He warned that such an arrangement could open the door to pressure on the Central Bank to accommodate expansionary fiscal policies, with inflationary consequences.
While acknowledging the government’s argument that stronger coordination between fiscal and monetary authorities is necessary, the Minority maintained that coordination must not translate into control.
They argued that collaboration can be achieved through consultation and information-sharing without compromising the Bank’s independence.
Responses
In response, the Minister of Finance, Dr. Cassiel Ato Forson, rejected claims that the provision undermines the Central Bank’s work.
He argued that the amendment seeks to improve policy harmonisation and is consistent with the constitutional mandate of the Bank of Ghana to promote economic development alongside price stability.
He further insisted that safeguards remain in place to prevent abuse and that Parliament retains oversight authority.
The concerns emerged during deliberations on the bill, which the government says is critical to strengthening monetary governance and meeting conditions under Ghana’s International Monetary Fund (IMF) programme.
The proposed law is also expected to pave the way for the release of the next tranche of IMF support later this year.
Presenting the report of the Economy and Development Committee, its Chairman, Dr. Eric Afful, urged Parliament to fast-track the passage of the bill, stressing its urgency and importance to restoring confidence in the country’s financial system.
He said the amendments are designed to improve monetary efficiency, strengthen the Bank’s institutional framework and reinforce financial stability.
While acknowledging the need for reforms, several MPs questioned whether the bill goes too far in reshaping the governance structure of the Central Bank.
The MP for Bolgatanga Central, Isaac Adongo, said although the bill seeks to enhance coordination between the Ministry of Finance and the Bank of Ghana, especially during emergencies, Parliament must retain firm control to prevent abuse of any expanded powers.
By Ernest Kofi Adu, Parliament House