Finance Ministry highlights PFM deficiencies amid new strategic plan
Ghana’s public financial management (PFM) practices have come under critical review, with recent findings indicating significant gaps in transparency, accountability, participation, and oversight.
At a recent World Bank Roundtable Discussion on PFM reforms, Dr. Mohammed Sani Abdulai, Programme Director of the Programme Coordination Office at the Ministry of Finance, underscored the country’s poor performance on the Open Budget Index (OBI).
Dr. Abdulai revealed that Ghana scored 56 out of 100 for budget transparency, falling short of the 61 needed to be deemed adequately transparent.
Additionally, the country earned a mere 20 out of 100 in public participation and 39 out of 100 in budget oversight. These figures highlight the pressing need for substantial reforms to bolster the integrity of Ghana’s financial management systems.
The breakdown of Ghana’s participation scores paints an even starker picture. While the nation scored 47 out of 100 in budget formulation and 33 out of 100 in budget auditing, it received an alarming 0 out of 100 for both the approval and implementation phases.
Despite these deficiencies, Ghana ranks 45th out of 120 countries on the OBI, outperforming many of its African peers but still reflecting significant room for improvement.
In response to these findings, Ghana has initiated a comprehensive five-year PFM strategy (2022-2026), aiming to address these shortcomings and enhance overall financial management. This strategy is anchored in two primary themes: fiscal consolidation and sustainability.
The strategy comprises five strategic pillars, 17 strategic objectives, and 40 strategic interventions, all designed to enforce greater accountability and transparency.
“The lessons learned from our PFM implementation underscore the necessity of a robust and comprehensive strategy, guided by effective PFM management tools,” Dr. Abdulai remarked. This strategic approach is expected to correct the current deficiencies and elevate Ghana’s PFM practices to meet international standards.
In order to strengthen Ghana’s PFM practices, CSOs and other non-state actors present at the roundtable discussion, spoke against the overly diplomatic approach of development partners such as the World Bank to the Government particularly when the Government takes decisions that are inimical to PFM asserting that the World Bank should be more open and candid with the Government on its inefficiencies in the application of PFM, particularly during periods of economic downturns
Additionally, CSOs and non-state actors urged the World Bank to publish projects being undertaken by the Bank in the country as well as the loans given to the government to execute projects or programmes, in order to aid the tracking of such fund disbursements and hold the Government accountable should the funds or loans be misallocated or misappropriated.
Furthermore, the CSOs called for a strengthening of the country’s internal control audit systems with the passage of the Internal Audit Bill to entrench accountability at both the district, municipal, and national levels.
World Bank Regional Director for Western and Central Africa, Abebe Adugna Dadi, also spoke at the event, highlighting Ghana’s potential to become a leader in PFM practices. He emphasized the critical role of non-state actors, such as civil society organizations (CSOs), in holding the government accountable and driving reforms.
“Ghana has the potential to lead by example in PFM practices. Even if the government falls short, CSOs can and should apply pressure to ensure accountability and transparency,” Mr Dadi stated.
He reaffirmed the World Bank’s commitment to supporting Ghana through constructive feedback and collaborative efforts aimed at strengthening the country’s PFM framework.
As Ghana embarks on this ambitious reform agenda, the focus will be on transforming its public financial management to foster greater transparency, accountability, participation, and oversight, thereby enhancing the trust and confidence of its citizens and international partners.
