Government has made loan recovery from the Business Assistance Fund (BAF) one of the cardinal objectives for this year's budget to ensure that monies borrowed are not regarded as gifts.
Mr Yaw Osafo-Maafo, Minister of Finance, said a large proportion of beneficiaries of such facilities consistently failed to repay the loans.
The minister said this in the first budget presentation by the government on Friday. He said as a first step, government has directed that all defaulters of BAF make repayments of amounts outstanding against them by the end of May, this year.
After that period, the Ministry of Finance would compile the list of all such loan defaulters and institute all available measures to recover the amounts outstanding.
Only 10 per cent of the amount initially loaned out from the BAF has been repaid so far. The minister said such funds, if recovered, could be re- channelled to assist other entrepreneurs in the private sector.
Other facilities that would be affected by the initiative include bilateral grants from Canada, Germany, Japan and the United Kingdom for which huge amounts are outstanding.
The minister asked all Ministries, Departments and Agencies (MDAs), which have obtained credit facilities from commercial banks and other sources to regularise the transaction by April 30. He also reminded all MDAs, which have availed themselves of such credit facilities that they require prior approval of the Minister of Finance before they do so.
On private savings accounts by banks, the Minister said: "Government deplores the current procedure for operating savings in some of the commercial banks within the country. "In some cases, initial amounts of not less than 500,000 cedis are required to enable people to open savings accounts.
"While appreciating the administrative difficulties in the maintenance of such accounts, government nonetheless feels this is a discouraging factor in the efforts to mop up excess liquidity in the system."
Mr Osafo-Maafo said Government would, therefore, request commercial banks to review the requirements for operating savings accounts with a view to minimising the burden on prospective clients.