NDC caucus criticizes Bank of Ghana’s response to 2022 financial report concerns

August 9, 2023
NDC caucus criticizes Bank of Ghana’s response to 2022 financial report concerns
MDC Minority Leader Dr Cassiel Ato Forson

The National Democratic Congress () Caucus in has strongly reacted to a recent press release from the (BOG), dated August 9, 2023.

The BOG's statement aimed to counter the NDC's concerns raised during their press conference on August 8, 2023, regarding the bank's 2022 published annual report and financial statements.

The NDC Caucus expressed dismay over the BOG‘s attempt to justify what they termed as “recklessness and mismanagement” that led to substantial financial losses.

The BOG had reported a staggering loss of GH¢60.8 billion and negative equity of GH¢55.1 billion for the year 2022.

According to the NDC's response, the BOG's press statement lacked substantial addressing of the issues raised during the NDC's press conference, referring to it as “full of deliberate distortions and flimsy justifications.”

Key points from the NDC's response include:

Printing Money Contravention

The NDC criticized the BOG for not adequately addressing the alleged contravention of Section 30 of the Bank of Ghana (Amendment) Act, 2016, about the printing of money for the government in 2021 and 2022.

They highlighted the substantial amounts printed, GH¢35 billion in 2021 and GH¢42 billion in 2022, which they claimed exceeded the legally acceptable threshold of 5% of the previous fiscal year's total revenue.

“Indeed, throughout the statement, BOG does not and could not have offered any reasonable justification for printing a whopping GHS35 billion in 2021 and GHS42 billion in 2022 to finance the /Bawumia/ government, in clear breach of their governing law”. the statement said.

Illegal Write-off of Debt

The NDC argued that the BOG's explanation for the alleged illegal write-off of the GH¢48 billion debt owed by the government lacked a legal basis.

“For emphasis, a mere declaration of intent to Parliament by the government to engage in debt restructuring does not amount to a resolution or approval by Parliament for BOG to write off public funds. Neither does the IFRS accounting standard referred to by the Bank of Ghana permit the writing-off of public funds without Parliamentary approval”. the NDC said.

They noted that the government's mere intention to engage in a domestic debt exchange program did not justify the BOG's actions.

“We wish to state unequivocally for the records, that at no point has the Finance Minister presented a report to Parliament informing the house of the attainment of the 5% borrowing threshold or the setting of a new limit of government borrowing as required by section 30 of the Bank of Ghana Act. Nor has the Finance Minister sought the approval of Parliament for BOG to write off any public funds, as required by section 53 of the Public Financial Management Act 2016 (Act, 918).” the statement said.

Economic Malaise and Reckless Borrowing

The NDC pointed out the BOG's admission that the country's economic challenges were due to “fiscal overruns and debt distress” starting in 2019. They criticized the BOG for allegedly funding the government's recklessness through illegally printing money.

“This confession by the Bank of Ghana, confirms the NDC's long-held view that the economic mess we have on our hands is the product of the reckless borrowing and expenditures of the Akufo-Addo/Bawumia/NPP government.”

“Sadly, instead of advising the government to embark on the needed fiscal reforms and adjustments, the Bank of Ghana confesses that they decided to fund the recklessness of the government by engaging in the illegal printing of monies for the government, part of which they have illegally written off without recourse to Parliament.” the statement added.

Outrageous Expenditures

The NDC objected to the BOG's operational expenditures reported in the 2022 Annual Report, which they deemed excessive and unjustifiable given the nation's economic challenges.

The statement added that” we wish to make the point, that none of the explanations put forward by the Bank of Ghana in its press statement of 9th August 2023 can rationalize or justify the outrageous operational expenditures they engaged in 2022, as reported by their Auditors in the 2022 Annual Report and Financial Statements of the Bank.”

New BOG Head Office

The NDC questioned the BOG's justification for constructing a new office complex costing $250 million (GH¢3 billion), particularly during a time of economic hardship.

The statement concluded that “The excuse that the current Bank of Ghana Head office is not earthquake resistant is most ridiculous. We need not remind the Bank of Ghana that previous Governors and Directors of the bank maximized the operations and profit of the bank from that same old facility by deploying more reasonable options of relocating aspects of the bank's operations to the House and another facility of the Bank on the Spintex Road.”

The NDC's response concluded by demanding the resignation of the Governor, his deputies, and the Board of the BOG, asserting that their actions have compromised the bank's independence.

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