Jul 272014

Seth TerkperIf as the Al-Hajj newspaper alleges, the severe reduction in donor inflows to augment our national budget is predicated on government’s pronouncement of a home grown economic strategy, then the government has failed to excel in two main respects.

Firstly, the government has failed to coherently articulate the details of this home grown economic strategy to the understanding and appreciation of every Ghanaian. It has thus been unsuccessful in galvanizing mass political support for a certain patriotic mission of self-reliance. Secondly, the government has failed to communicate by its body language beyond exhortations, that we face such dire times that it is willing and able to lead in an inspirational manner that is a marked departure from business-as- usual.

How can these times be normal? The Minister of Finance has set a specific goal of reducing wage bill as a share of tax revenue, from 57 percent in 2013 to 35 percent by 2017, ostensibly in line with ECOWAS criteria. In simple words, salaries will stagnate over the next five years. Apparently not in tune with sharp cries from the labor front about economic hardships, government still speaks of a so called “growing consensus between government and labor.” Growing consensus for a wage freeze? Really? The freeze on employments also translates into fewer jobs—another hard choice. To increase rapidly dwindling revenues, government has either introduced new taxes or increased existing ones. Five categories are named — 2.5% increase in VAT, communications service tax, petroleum excise tax, corporate income tax rate of free zones companies and, withholding tax. This is another squeeze that is expected to bite. Government’s policy of “bringing utility and petroleum subsidies within budget estimates” translates at the common man’s level into rapidly galloping fuel prices and utility tariffs.

With all these hard-hitting pocket-shattering policies, how does the government appear to expect people to simply sit back, be patient and understand the harsh times unless and until they are given a compelling reason to do so? By advocating a home grown strategy, it would appear that government does not lack insight into the economic problem and its root causes. By running with a policy, however good, without securing the good will of the people, government appears to be displaying lack of insight into the very political underpinnings of its power base.

On this economic matter, how has the government communicated? I hereby make references to statements issued by the Honorable Minister of Finance and the Governor of the Bank of Ghana? Rather than speak in a language I understand, they have resorted to high sounding economic jargons that do not explain why paying high prices for electricity does not spare me from hot dark nights. Hear them, “expenditure rationalization to achieve the fiscal deficit target of 8.5 percent of GDP for the year; shortfall in tax revenue resulting from lower domestic output; under performance in government revenues; fiscal consolidation; continuous shortfall in grants from Development Partners relative to the budget target; overrun in the compensation or personal emoluments …; overrun in interest costs due mainly to financing of the deficit…” and on and on and on …

This is precisely the language that I do not understand or appreciate. What I can understand is if you were to tell me we are currently living beyond our means for which reason we are slashing down on free state gifts.

Government has spoken eloquently about “minimizing waste in expenditure on goods and services and capital.” You know my difficulty with these jargons! I shall however assume that this means that government will not pay for frivolities. If I am right, then government should expect the ire of investigative journalist Manasseh Azurre Awini who has been the torch bearer of the GYEEDA, and SADA, corruption stories. He points out in a recent feature how some are on trial for wilfully losing Gh¢4M when others are alleged to have lost GH¢240M to the State while others are being treated with kid gloves to return GH¢55M to the State and others, GH¢140M. In my humble opinion, guilty or not guilty of proven corruption, the President woefully missed the opportunity to claim the “moral high ground” (apologies to President Rawlings) with these cases quite early in his administration. Ask the man in the street and there is total lack of certainty that these cases were ever conclusively dealt with, whatever the facts were.

If I, as a Ghanaian citizen am made to understand that certain critical assumptions by way of support that we have always taken for granted from partners no longer hold, if I become convinced, that government, through word and deed is leading us on a visionary path to self-reliance that calls for short term sacrifice and medium-long term sustainable development, I will be willing to embrace that suffering and sacrifice. I will play my part. I will pay higher electricity tariffs with a smile. I will gladly pay higher water bills because my senior colleague Mr. Ivan Essegbey for whom tap water in capital Accra is an unspoken rarity will start enjoying the thrills of running water. I will entertain stagnation in salaries because when I am sick, the hospitals will not demand cash at the point of service delivery.

In return, I will see government taking unusual decisions. Government and party activists will prioritize competence and results- oriented leadership. I will see a radical drop in the number of Ministers. Ministers and Boards etc., will be in place within two months of the President’s swearing-in. There will be such ruthlessness towards corruption that no one will be in doubt as to the true meaning of its zero tolerance.

Today, things are happening just the way everything has been happening for the past twenty two years. And yet, government would have us believe that certain serious economic fundamentals have changed which make the current hardships more of a structural defect calling for greater self-reliance. Let government succinctly articulate that vision of self-reliance and shake itself up to lead its execution. We shall follow.

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