STATUS REPORT OF GHANA’S PDIA TEAM CABRI/ Building State Capacity Closing Workshop on PFM in Africa South Africa 11 th December, 2017 1
INTRODUCTION ➢ The TEAM is passionate about learning a new approach to solving complex problems: ➢ TEAM MEMBERS: 1. SEIDU DAWDI ADAMS 2. ALEXANDER NKANSAH 3. THELMA DANGBEY-KUBI 4. PETER AIDOO 5. GEORGE OFORI-ATTA 6. ERIC YARTEY ➢ TEAM COACH: PETER JOHN JONATH (CABRI SEC.) 2
GHANA TEAM AND COACH 3
AGENDA • Introduction; • Problem Statement; • Status of work; • Entry Points and outputs • Authorizer’s role • Challenges, Lessons • Recommendations and Next Steps 4
President’s quote • “We can no longer continue to make policies for ourselves, in our country, in our region, in our continent on the basis of whatever support the western world or France or the European Union can give us. It will not work, it has not worked and it will not work. Our responsibility is to charter a path which is about how we can develop our nations our selves” 5
PROBLEM STATEMENT “Insufficient discretionary Fiscal Space associated with Non- Lodgment in Gross of Retained NTR/IGF Receipts” 6
FISHBONE ANALYSIS Insufficient Fiscal Space Associated with Non-Lodgement in Gross of Retained NTR/IGF Inadequate cash flow Non application of sanctions Weak revenue forecast Non compliance to Legal provision Delays in release of allocation Inadequate incentive to Inadequate Data comply Unanticipated Expenditures Unrealistic Assumptions Inadequate Non adherence to Resources procedures Not seen as a priority Recommendation lack Weak internal Of Monitoring of sanctions Controls Reports Non-enforcement Weak monitoring Non enforcement Not implemented of 7 Of sanctions sanctions
FISHBONE ANALYSIS DELAYS IN THE RELEASE OF ALLOC Inadequate cash flow NON COMPLIANCE WITH LEGAL PROVISION Weak revenue forecast Unrealistic assumptions Inadequate incentives to comply Unanticipated expenditures Inadequate data Non application of sanctions Scattered data across MoF and MDAs Lack of clarity of legal provisions to MDAs Non sharing of data Fusion of roles Lack of common data sharing platform Fear of loosing relevance and control Fear of not getting additional remuneration Insufficient discretionary fiscal space associated with Non – Lodgment in gross of Retained NTR/IGF receipts WEAK MONITORING Inadequate resource allocation WEAK INTERNAL CONTROL MECHANISM Not seen as a priority -Non adherence to procedures Monitoring recommendations not implemented -Lack of incentives to adhere to Lack of incentive to implement recommendation Procedure Non enforcement of sanctions -Non application of sanctions Cronyism and nepotism -Fusion of roles 8
ENTRY POINT ANALYSIS - DELAYS IN THE RELEASE OF ALLOC. Inadequate cash flow Authority Weak revenue forecast Unrealistic assumptions Unanticipated external Ability Acceptance shock Unplanned expenditures Inadequate data Fear of loosing relevance Fear of not getting Scattered data across MoF and control additional remuneration and MDAs Lack of common data Non sharing of data sharing platform
BASIS FOR ENTRY POINT - LACK OF COMMON DATA SHARING PLATFORM AUTHORITY ABILITY ACCEPTANCE • Minister’s quest to • Available data and • Numerous improve fiscal systems; stakeholders with projections and varying interest; budget credibility; • Enough resources to improve existing • Willingness to accept • Minister will approve systems to and own process will accommodate be challenged; platform; • We need data • Existing capacity to gathering, story lines build and manage and engagement with data and systems; stakeholders to build acceptance 10
ENTRY POINT ANALYSIS – WEAK MONITORING Inadequate resource allocation Authority Not seen as a priority Monitoring recommendations not implemented Lack of incentive to implement Acceptance Ability recommendation Non enforcement of sanctions Cronyism and nepotism
BASIS FOR ENTRY POINT – NON ENFORCEMENT OF SANCTIONS AUTHORITY ABILITY ACCEPTANCE • The financial • Structures in • There is laws mandate place growing the Minister to concern sanction amongst the • Mandate of the citizenry and Hon. Minister leadership that • Quest to provided under we need to enforce fiscal the PFM law enforce our discipline by laws Hon. Minister 12
ENTRY POINT ANALYSIS – NON COMPLIANCE WITH LEGAL PROVISION Inadequate incentives to comply Authority Non application of sanctions Acceptance Ability Lack of clarity of legal provisions to MDAs Fusion of roles
BASIS FOR ENTRY POINT – LACK OF CLARITY OF LEGAL PROVISIONS TO MDAs AUTHORITY ABILITY ACCEPTANCE • Minister’s quest to • Capacity to train • Stakeholders will increase discretionary and/or sensitize gladly accept as they fiscal space; relevant stakeholders; may not have to commit resources to orient themselves on • Minister will approve • Availability of the legal provisions; platforms within the budget preparation process to undertake • It will be in the interest the activities of all stakeholders to embrace the training and/or sensitization • Enough resources to undertake the exercise; 14
How will the Problem look like solved? • Improved discretionary fiscal space associated with Non- Lodgment in gross of retained NTR/IGF receipts • 70% of all MDAs allowed to retain their IGF will lodge it in gross; • 60% of the projected yield (GH ¢ 1.2bn) will be achieved; • Improved discretionary fiscal space by GH ¢ 720m 15
ACTION POINTS SRN Entry Point Output Immediate action • Relevant stakeholders identified; • Finalize report for • Draft Concept Paper in place; presentation; • Stakeholders engagement Lack of • Seek authorization Common Data workshop organised – workshop 1 and approval to act; Sharing report; Platform • Develop outline of • Processes and systems draft Concept Paper established for creating a Common Data Sharing Platform. 16
ACTION POINTS SRN Entry Point Output Immediate action • Identify evidence of relevant Audit/PAC • Non compliant officers Non- Reports 2 Enforcement sanctioned recommending of Sanctions punitive and reform actions not applied 17
ACTION POINTS SRN Entry Point Output Immediate action • Identify and outline platforms in • Knowledge of the national budget process to implementing implement this activity; officers on the relevant legal • Assemble all relevant regulations Lack of Clarity provisions governing NTR/IGF mobilisation of Legal enhanced; and management and PFM; 3 Provisions to • Mechanism for MDAs • Agree with CAGD, affected MDAs lodgment in gross of and all relevant stakeholders on Retained NTR/IGF modalities for the receipts by MDAs operationalization of the properly in place mechanism for lodgment in gross and operational of Retained NTR/IGF Receipts 18
STATUS OF PLANNED ACTIONS ON ENTRY POINTS 19
Key Achievements after framing workshop Report approved Prepared Concept Buy- in from and Note for the Directors of Finalised training Authorization establishment of Budget, Revenue report and Data Sharing obtained from Policy Division and submitted for Platform; Economic Research Honourable approval; and Forecasting Minister for Identified common Division; data platform Finance Sensitization of all Sensitization of Enhancement of MDAs/ MMDAs on Identified relevant MDAs on the mechanism for the relevant AG’s reports to mechanism for lodgement in sections of PFM Act implement lodgment in and the Earmark sanctions where gross of IGFs gross of IGFs Fund Capping and necessary; receipts; receipts; Realignment Act 20
1. Lack of Clarity of Legal Provisions to MDAs Output Planned Action Status Performance Issues/Remarks Processes used included; Knowledge of Budget Preparation Use the implementing officers production national budget on the relevant legal MDAs Workshops; process to Achieved provisions enhanced. Sensitized. sensitize MDAs NTR/IGF Projections Workshops; National/Regional Budget Hearings 21
1. Lack of Clarity of Legal Provisions to MDAs Issues/ Output Planned Action Status Performance Remarks Mechanism for Ensure consistency lodgment in gross of relevant legal of Retained provisions on Consistency NTR/IGF receipts Achieved lodgement in gross established. by MDAs is in with proposed place and mechanism. operational. 22
1. Lack of Clarity of Legal Provisions to MDAs Output Planned Action Status performance Issues/ Remarks 127 MDAs; Mechanism for Seek agreement Only 49 complying; lodgment in with CAGD, affected Major MDAs gross of MDAs and all Agreement exempted; Retained relevant reached and Achieved Delay in NTR/IGF receipts stakeholders on mechanism implementation; by MDAs modalities for the operational. Revised target to properly in place operationalization 2.5% of 1.2billion and operational. of the mechanism. Cedis. 23
2. Non- Enforcement of Sanctions Planned Output Status Performance Issues/ Remarks Action Audit reports reviewed (2014 Identify – 2016) did not No Non compliant evidence of clearly provide recommendations of Partially officers non- any breaches; punitive and reforms achieved sanctioned compliance in Audits in the actions identified. Audit Reports. period did not focus on NTR/IGF. 24
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