.....Minister Orders Audit Inspection
Mr Yaw Osafo-Maafo, Minister of Finance, on Tuesday reiterated that the former government overdrew almost 900 billion cedis of its accounts at the Bank of Ghana.

In a statement delivered by the Minister in Parliament, he said: "I wish to go on record that I will never impugn the integrity of my colleagues on the other side (minority), for the sake of political expediency."

The statement sought to react to a Ghanaian Chronicle publication that alleged that Mr Victor Selormey, a former Deputy Minister of Finance, has challenged Mr Osafo-Maafo's claim, promising to "put his reputation on the line to prove him wrong"

In that publication, another former Deputy Minister of Finance, Mr Moses Asaga, questioned the credibility of Mr Osafo-Maafo's allegations made on March 9, and called on the Minister and the Governor of the Bank of Ghana (BOG) to give details of the transaction.

Mr Osafo-Maafo said: "I wish to state emphatically that my declaration of government overdrawn accounts at the Central Bank is supported by communications that I have received from both the BOG and the International Monetary Fund (IMF)".

He said on February 16, 2001, the Governor of BOG communicated to him that "at the end of the third quarter of year 2000, central government account showed an overdrawn position of three billion cedis. This position deteriorated further on monthly basis, during the last quarter, rising to 855.5 billion cedis by the end of December 2000."

Mr Osafo-Maafo said the overdrawn position reflected the net balance on total government inflows and payments, both statutory and discretionary.
"Where as the statutory payments were pre-determined and Bank of Ghana could monitor, most of the discretionary payments especially from the districts and regions were undertaken without making reference to government financial position at the Central Bank."

He said such payments were effected at the regional treasuries after which the cheques were forwarded through the clearing system.

The Minority requested that the governor of BOG be summoned to brief the "Committee of the Whole" (Parliament sitting in camera) on the matter but the Majority dismissed the idea saying it prefers that the Finance Committee handle the matter.

Mr Peter Ala Adjetey, Speaker, appealed to both sides to consult on the matter and reach a compromise soon.

.....Minister Orders Audit Inspection

THE Minister of Finance, Mr Yaw Osafo-Maafo, yesterday stated that the government has initiated action to audit an alleged overdrawn amount of ?900 billion by the former government from the Central Bank.

The Minister said the government will do everything possible to set the records straight and find out how the money was used.

Mr Osafo-Maafo said this in an urgent statement in Parliament in reaction to a publication in the Ghanaian Chronicle of Monday, March 12, in which the former Deputy Finance Minister, Mr Victor Selormey, challenged the Minister on the veracity or otherwise of the allegation that the government overdrew between ?3 billion and ?900 billion as stated by the Finance Minister in his budget statement on March 9.

In the publication under reference, Mr Selormey was reported to have said that he is prepared to put his reputation on the line by insisting that there was never any occasion when the government ever decided to withdraw such an amount from the coffers in the last quarter of the year 2000.

Both Mr Selormey and Mr Moses Asaga, also a former Deputy Finance Minister and now the Shadow Minister of Finance, insisted that the former government did not do anything of the sort.

However, Finance Minister, Mr Osafo-Maafo, insisted that he had received two letters, one from the Governor of the Bank of Ghana (BOG) and the other from the World Bank Mission which alerted the new administration of the overdrawn account.
“I will never impugn the integrity of my colleagues at the other side. But what I am telling the House is based on these two letters,” Mr Osafo-Maafo said.
He disclosed that the letter from the Governor of the Central Bank dated February 16, 2001 stated that “at the end of the third quarter of year 2000, Central Government’s accounts with the BOG showed an overdrawn position of ?3.0 billion. This position deteriorated further on monthly basis, during the last quarter, rising to ?855.5 billion by the end of December 2000”.
The Governor went on to add in the letter that “the overdrawn position reflected the net balance on total government inflows (committed and uncommitted) and payments, both statutory and discretionary. Whereas the statutory payments were pre-determined and the BOG could monitor, most of the discretionary payments, especially those from the districts and the regions, were undertaken without making reference to government financial position at the Central Bank. Such payments were effected at the regional treasuries after which the cheques were forwarded through the clearing system”.
The Governor, therefore, recommended in his letter that an audit be carried into these usually referred to as Direct Debt Accounts which, in his opinion, were beyond the control of the Central Bank.
Reacting to the Minister’s statement, Mr Dan Abodakpi, NDC member for Keta and former Minister of Trade and Industries, suggested that since the allegations were so serious, it was better for the House to invite the Governor of the BOG to brief the members on the truth or otherwise of the matter.
However, the request was overruled by the Speaker, Mr Peter Ala Adjetey, who also suggested that the matter should be handled by the leadership of the House and inform the Committee of the Whole House.
The House later started the debate on the government’s budget statement presented to members by the Finance Minister, Osafo-Maafo last Friday.
Mr Moses Asaga, Minority Spokesman on Finance, described the budget as a document which does not offer any short term solutions to the country’s economic problems.
He said the tax net is unimaginable because the ordinary person will now be asked to pay 12.5 per cent on local food items such as “waakye”, “abolo”, kenkey and “omo tuo” because of the fact that the Value Added Tax threshold has been reduced from ?200 million to ?100 million.
He said the country accepted the HIPC conditionalities without due regard to any national debate on the issue.
Mr Asaga pointed out the National Reconstruction Levy of 15 per cent will worsen the plight of the private sector and cautioned that some of the new taxes and tariffs introduced are unachievable.
He said the increase in petroleum prices and the anticipated increases in the water and electricity tariffs will also worsen the plight of industry and the population as a whole.
Alhaji Seidu Issah Abah (NDC, Chereponi) also described the budget as “killing me softly” document which did not answer the hopes and aspirations of the people.
“The budget did not present the positive change that the NPP government promised Ghanaians”, he stressed.