2017年-世界发展银行全球_Fiscal_Consolidation_to_Accelerate_Growth_and_Support_Inclusive_Development___Ghana_Public_Expenditure_Review_155页_3mb

Summary of the Ghana Public Expenditure Review

Core Content

This document presents the Ghana Public Expenditure Review (PER), focusing on fiscal consolidation and its role in accelerating growth and supporting inclusive development. The report is structured around five main chapters, each addressing a key policy area: macroeconomic management and fiscal policy, tax expenditures, the wage bill, human capital development through education and health, and agricultural growth.

Main Views and Key Information

1. Macroeconomic Management and Fiscal Policy

• Ghana's Economic Growth: The country has experienced robust growth since the early 2000s, driven by favorable external conditions and investment inflows, particularly in extractive industries.
• Fiscal Deficit: The fiscal deficit rose from 6.3% of GDP in 2015 to 8.7% in 2016, highlighting the challenges in fiscal consolidation.
• Fiscal Targets: The government aims to reduce the fiscal deficit to 3% of GDP by 2018, with plans to adjust expenditures and raise revenues.
• Debt Sustainability: Ghana faces high risks of external debt distress, and the government must achieve a primary fiscal surplus of 0.4% to control new debt accumulation.
• Debt Management: Proactive debt management is necessary to reduce interest payments and improve the public debt profile. The government has initiated a macroeconomic management capacity-building project with support from the World Bank.
• Public Investment: Public investment remains below that of comparable countries, limiting growth and job creation. Closing the infrastructure gap will require a shift in expenditure priorities.
• Fiscal Strategy: The government must incorporate the transient nature of oil revenues into its medium-term budget strategy, ensuring that public investment is aligned with long-term development goals.

2. Tax Expenditures

• Definition and Scope: Tax expenditures are a range of tax incentives and exemptions that reduce the tax burden on certain sectors and income groups, but are not fully recorded in the budget.
• Fiscal Impact: In 2013, tax expenditures amounted to 5.2% of GDP, with VAT exemptions and preferential treatment accounting for 4.2%, and customs exemptions for 0.9%.
• Challenges: Tax expenditures create economic distortions and vested interests, and are often difficult to eliminate once established.
• Reform Recommendations:
  • Broaden the tax base and improve tax compliance to increase revenue.
  • Eliminate tax expenditures that serve no clear policy purpose.
  • Re-evaluate tax benefits for low-income households to ensure they are targeted effectively.
  • Consolidate trade-related tax expenditures into an export-promotion strategy that fosters domestic competition and regional integration.
  • Retain customs exemptions on manufacturing inputs and capital goods only if they support a clear sectoral development strategy.
  • Phase out exemptions on most consumer goods and eliminate special exemptions approved by Parliament.

3. Managing the Public Sector Wage Bill

• Wage Bill Overview: The wage bill is the largest recurrent expenditure, and its management is crucial for fiscal stability.
• Single-Spine Salary Structure (SSSS): Implemented in 2010, the SSSS aims to standardize salaries across the public sector. However, the structure is still underutilized, and wage dispersion remains high.
• Reforms Since 2014: The government has taken steps to improve wage bill management, including the introduction of a pay-to-procure system and a commitment-control mechanism.
• Political Economy: The political economy of wage reform is complex, with resistance from public sector employees and unions.
• Recommendations:
  • Continue reforms to improve wage bill management and reduce inefficiencies.
  • Strengthen public financial management (PFM) to ensure transparency and accountability.
  • Consider adopting the BOOST budget tool to improve fiscal policy analysis and decision-making.

4. Human Capital Development

• Education and Health Spending: These sectors are critical for human capital formation and long-term economic growth.
• Education Sector:
  • Public education spending as a share of GDP is below regional and global averages.
  • Education budget execution rates are uneven, with disparities between regions and institutions.
  • There is a need to improve teacher training, textbook availability, and access to education.
  • The New Policy on Universal Access to Upper Secondary Education aims to expand access and improve quality.
• Health Sector:
  • Public health spending is also below regional averages.
  • Health outcomes show disparities across wealth quintiles and regions.
  • The National Health Insurance Scheme (NHIS) plays a key role in health financing.
  • Improving health service delivery and ensuring equitable access to essential services are critical priorities.
• Recommendations:
  • Increase public investment in education and health to improve human capital.
  • Ensure equitable access to essential services and improve the quality of education and health care.
  • Strengthen the legal and institutional framework for PFM to support effective human capital development.

5. Agricultural Growth

• Agricultural Sector: Despite its shrinking economic size, the agricultural sector remains vital for employment and poverty reduction.
• Public Spending: Public spending on agriculture has been insufficient compared to other sectors.
• Cocoa Production: The Ghana Cocoa Board (COCOBOD) plays a key role in managing cocoa production and export.
• Productivity and Yields: Ghana's agricultural productivity growth is below that of other Sub-Saharan African countries.
• Future Outlook: As the oil industry expands, labor and capital may shift away from agriculture. Continued investment in both food and cash-crop subsectors is essential to maintain economic stability and support rural development.
• Recommendations:
  • Enhance expenditure targeting in the agricultural sector to improve productivity and yield.
  • Continue investment in agriculture to support employment and poverty reduction.
  • Leverage oil revenues to finance infrastructure and public services that will benefit the agricultural sector in the long term.

Conclusion

The report underscores the importance of fiscal consolidation and structural reforms in ensuring sustainable growth and inclusive development in Ghana. It emphasizes the need to improve public financial management, reform tax expenditures, manage the wage bill effectively, and increase investment in human capital and agriculture. The recommendations highlight the role of the government in creating a more transparent, efficient, and equitable fiscal and expenditure framework to support long-term economic and social progress.