Interest payments constitute 50.4% of revenue as payments hit GHS 33.61bn in 2021
Total interest payments for last year constitute 50.4% of total revenue as government made some GHS 33.61bn payments in interest rates on loans.
This is higher that the envisioned interest rate payments target of GHS 32.5bn and higher than the 45.6% recorded in 2020.
According to the Bank of Ghana’s January 2022 Monetary Policy Report, government this year -2022- will be spending GHS 37.2bn, about 7.5% of GDP in 2022 on interest payments.
Total revenue (including grants) mobilised in 2021 amounted to a litte over GHS 67bn.
Meanwhile, total expenditures and arrears clearance for 2021 was estimated at GH¢110.401 billion, about 25.1% of GDP.
This was however below the target of ¢113.750 billion (25.9% of GDP).
The report also said the outturn was 97.1% of the target and represented a year-on-year growth of 10.3%.
Compensation
Compensation of employees including wages and salaries, pensions and gratuities, and other wage-related expenditure totalled ¢31.663 billion, higher than the target of ¢31.490 billion.
In terms of fiscal flexibility, compensation of employees constituted 47.5% of domestic revenue mobilised at the end of 2021, lower than the 52.4% recorded in the corresponding period of 2020.
Goods and Services
The use of Goods and Services for the period under review was ¢8.624 billion, higher than the expected target of ¢8.523 billion.
The outturn was 1.2% above the target and also represented a year-on-year decline of 16.7%.
Grants to other government institutions
Grants to other government units made up of National Health Fund, Education Trust Fund (GET Fund), Road Fund, Energy Fund, District Assemblies Common Fund (DACF), Retention of IGFs, Transfer to Ghana National Petroleum Corporation and other earmarked Funds, all summed up to ¢13.314 billion.
This was lower than the envisioned target of GH¢18.081 billion and represented a shortfall of 26.4%.
It, however, recorded a year-on-year growth of 12.1%.
Other expenditure
Other expenditure, made up of ESLA transfers and COVID-19 related expenditure for 2021, totalled ¢4.537 billion, which was 33.2% below the target of ¢6.791 billion.
Capital expenditure
Capital expenditure for the period was ¢15.541 billion, about 3.5% of GDP.
This was higher than the envisaged target of ¢12.222 billion (2.8% of GDP) by 27.2%.
This outturn represented a year-on-year growth of 28.6%.
Also, foreign-financed capital expenditure accounted for 65.7% of the total expenditure, with domestic financed capital expenditure making up the remaining 34.3%.
