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7th April, 2021
At its meeting on Monday, March 5th, 2021, the Standing Committee (SC) of the Socialist
Forum of Ghana (SFG) reviewed the 2021 Budget in relation to the overall strength of the
national economy and the imperative to improve the living and working conditions of the
people of Ghana especially the underprivileged. After exhaustive discussions, the SC came to
the following conclusions:

1) The policy objectives of every budget are to stimulate the national production base and
increase the welfare of the generality of the Ghanaian citizenry which becomes mirrored in
upward standards of living. So, for most Ghanaians the expectation is that the NPP
Government will seize the initiative offered by the Pandemic to begin reorganizing the
national production base to produce goods and services or products, which go directly to
satisfy our daily requirements, as well as those we do not need directly (i.e., commodities)
for exchange with the rest of the world for revenues to meet the development demands of
our economy. We also expect the 2021 Budget will further provide stimulants to the real

sectors of the economy (i.e., agriculture, industry and mining) to overcome the temporary
constraints imposed by COVID-19 pandemics and increase overall outputs thereby
preserving and creating jobs, real incomes and their purchasing power. Additionally, it is
expected that Government will cut its current consumption expenditures and inject the
saved resources into the modernization of and across all sectors of production through
science and technology and to create markets and commodity exchanges for our peasant
farmers along the value chain.

For purposes of enhancing general welfare and standard of living, it was expected the
Government through the 2021 Budget will:
a) create a level playing field and access to job opportunities, the right to work for
equal pay and remuneration as well as protect the purchasing power parity of all
classes of Ghanaians;
b) provide access to quality health care which is non-discriminatory and affordable to
all Ghanaians;

c) ensure adequate provision of social housing and sound environment in terms of
improved sanitation, and
d) guarantee affordable education for all at every level of the educational ladder
supported by fully-fledged infrastructure.

2) The SC noted that the Budget was not derived from a broad policy framework focused on
the fundamental restructuring of the Ghanaian economy aimed at making the people the
real owners of their resources which ought to be exploited for their own benefit. The budget
remains essentially a forecast of revenues and expenditures which leaves intact the
doctrinaire pursuit of neo-liberal objectives of transferring to and maintaining national

wealth in the hands of multi-national corporations from the industrialized capitalist SO

countries. The budget does not also indicate a shift from the paradigm of export of primary
products and heavy reliance on imports for goods and machinery.
3) The SC is also of the view that the 2021 Budget really does not seek nor intend moving us
away from our present economic backwardness which this country has suffered for the past
38 years or so. At best, it is intended to explain away the mismanagement of the national
economy in the last several years and the complete sell out to foreign interests
notwithstanding the small rent coming to the ruling cabal especially through contracting of
foreign debt.
4) This anti-people budget has imposed eight (8) punishing and unjust taxes on the poor. There
is levy on National Health Insurance mainly used by poor people, increase in consumption
tax (VAT) which regressively affects the poor the most, a tax on savings to pay for financial
cleanup which considerably affects the middle class, a flat regressive tax on refuse
collection and use of public toilets (a poor man’s toilet), fuel, road toll and COVID-19
5) The NPP Government has also abandoned production as one of the most viable and creative
ways to take us out of this economic black hole. It has rather resorted to piling up the debt
stock to fund recurrent expenditure. The 2021 budget, for instance, provides for 49% of
national revenue to cater for interest payments on debt and 30% on compensation, leaving
10% for statutory payments. Living up to their antecedent (Progress Party) economic
principle of ‘kafodidi’, the NPP Government has contracted another US$5 billion loan at
zero coupon rate to prop up consumption expenditures. A whopping US$3.6 billion of the
recent loan will be used to pay interests and retire principals on earlier debts and the

remainder of US$1.4billion as budgetary support to cushion and fund imports by the
importers’ cartel. From the foregoing disbursement, it is abundantly clear and frightening
that no portion of that loan is dedicated to national production of goods such as tomatoes,
onions, rice, sugar, poultry, petroleum products, textiles, electronic goods, and other
national products. In effect, national production is being run down by this killer purposeless
budget while importation of junk goods like second hand items become the order of the

6) Further, the Government fiddles with the figures and statistics by putting out manipulated
statistics and figures to hide the sordid state of the economy. They hide the budget deficit,
downplay the rise in the debt stock and keep absolutely quiet on the GDP to debt ratio.
7) The Socialist Forum of Ghana utterly condemns this empty budget which is an epitome of
the worst economic performance in recent memory. It is painful after rifling through the
stabilization fund and piling up consumption debts with no investment in production or
infrastructure to show, we call for control of our national resources, shift of the tax burden
from the common people to the rich and foreign multinationals, increase revenue from our
resources, removal of tax holidays and tax exemptions, investment in production, and
restrictions on unbridled imports especially of non-essential goods.

We also call for an economic model of development which is people-centered, democratically
controlled, and based on pro-Ghanaian development planning. This calls loudly for an
alternative model of development to this moribund market-driven unproductive neoliberal
model. The masses are urged to stand up and denounce this political and economic charade.

Below is the full document:

Justice Kofi Henaku
For Convener.
For further information:
Justice Kofi Henaku – Tel: +233 24 437 3622
Blaise Tulo – Tel: +233 54 024 781