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Finance Ministry failed to transfer 5% ABFA to DACF for 2 consecutive years – PIAC report

Finance Ministry failed to transfer 5% ABFA to DACF for 2 consecutive years – PIAC report

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For two consecutive years, the Ministry of Finance failed to transfer five percent of the Annual Budget Funding Amount (ABFA) to the District Assembly Common Fund (DACF), despite a directive by the Supreme Court in 2019.

In 2021, the Ministry of Finance was only able to transfer 1.74% of the ABFA, and in 2022, it could only transfer 2.39%.

According to the Supreme Court’s decision in the case of Kpodo and Another vs Attorney-General in 2019, the Minister of Finance is required to comply with the decision in the disbursement of funds to the DACF.

However, the Ministry’s recent inability to transfer the required amount indicates a lack of commitment to development at the local level.

Furthermore, the disbursement of funds to the Industrialisation Priority Area, which received GH¢9.29 million representing only 0.20% of the total ABFA of GH¢4.41 billion, did not reflect the priority given to industrialisation in the use of ABFA.

This disbursement, which represented only 4.29% of the amount budgeted for the priority area for 2022, highlights the need for the government to invest more in industrial development.

Despite this, an amount of GH¢643.61 million (US$73.68 million) was transferred to the Ghana Infrastructure Investment Fund (GIIF) in 2022 to support the government’s Agenda 111 Project.

This is the second consecutive year that GIIF has received funds for the project, with GH¢290.38 million (US$49.39 million) allocated to the Fund in 2021.

However, the Public Interest and Accountability Committee (PIAC) has recommended that disbursements intended for Agenda 111 should be directed to the Ministry of Health under the health component of the Education and Health Priority Area, in line with the project’s objectives.

Additionally, GIIF “should focus on investing in commercial infrastructure projects, as mandated by the GIIF Act, 2014 (Act 877) and policy guidelines of the Fund.”

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Filasco News

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