Industrialisation Priority Area sees drastic cut in funding

The 2023 annual report of the Public Interest and Accountability Committee has flagged reduction in allocation and disbursement of the Annual Budget Funding Amount (ABFA) to the industrialisation priority area in the past three years from 1.15 in 2020 to 0.11 per cent in 2023.

 PIAC’s 2023 report shows that in 2020, GH₵31.8million was disbursed to the industrialisation priority area while GH₵16.2 million was disbursed 2021, representing a 49.1% drop. In 2022, the amount disbursed to that priority area was GH₵9.2million showing a 43.2 % drop from the previous disbursement. There was a further 37% drop in 2023 to GH₵5.8million

PIAC reported that out of the GH₵5.8million disbursed to the Industrialisation priority area, GH₵5.1million were used by the Ministry of Lands and Natural Resources for consultancy services on mineral resource estimation, transaction advisory services, administrative expenses such as insurance on vehicles and purchase of stationery.

The Committee contends that for a country that seeks to develop other sectors of the economy and create jobs through industrialisation, allocations and disbursements to the priority area would be consistent but there had been no such justification for choosing industrialisation as a priority area.

PIAC in its recommendations urged the Ministry of Finance to show more commitment by investing more in industrial development.

The ABFA is the total amount approved by Parliament to be withdrawn from the Petroleum Holding Fund to support the national budget for any financial year. The ABFA is therefore the main channel through which petroleum revenue finances the national budget.

Priority areas selected by government for 2023 to 2025 are Agriculture including Fisheries, Physical Infrastructure and Service Delivery in Education and Health, Road, Rail and Other Critical Infrastructure Development and Industrialisation.