The Ghana Education Trust Fund (GETFund), according to a Parliamentary report, will be using some Ghs 866 million (approximately 60 percent) out of total projected inflows of Ghs 1.4 billion for this year to defray its debts.
Making the disclosure on the floor of Parliament, administrator of the Fund, Dr Richard Boadu asserted that should the said amount be taken out of the Fund’s projected inflows to settle its debts, the Fund will be left with only Ghs 534 million (40 percent) to undertake its programmes for the year.
“This is of grave concern and it will seriously impact the Fund’s programmes and activities for this year,” Dr Boadu stated.
Proffering some solutions to the administrator and other officials of the GETFund, some members of Parliament suggested that since the Fund’s inflows are tied to a percentage of projected revenues which could sometimes experience shortfalls, the Fund should focus on utilising its inflows to fund projects instead of resorting to borrowing.
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But justifying the Fund’s borrowings, officials of GETFund noted borrowings by the Fund enabled it to adequately finance and complete its projects on schedule and also helps to avoid high variation costs caused by delayed completion of projects.
“Project variation cost, which typically adds 40 percent to a project’s initial cost, is much higher compared with GETFund’s average borrowing rate of 20.5 percent,” officials of the GETFund added.
This year, GETFund has set aside Ghs 30 million for MPs emergency projects and monitoring activities.
The Fund will also spend some Ghs 175 million of its projected inflows on projects and programmes on tertiary education. With regards to secondary and basic education, the Fund will spend Ghs 74 million and Ghs 66 million on programmes and projects respectively.
