He emphasized the urgent need for spending changes while speaking at the National Economic Dialogue in Accra. He called for improved resource allocation and stricter fiscal discipline.
According to Dr. Forson, Ghana faces an unsustainable fiscal condition as a result of government spending exceeding GDP growth during the last ten years.
He noted that wages and salaries, expensive energy subsidies, and skyrocketing loan payments take up a large amount of spending, leaving little money for social services and infrastructure.
It is nearly impossible to allocate resources toward economic transformation because of these inflexible expenditures. He bemoaned, "We are spending more, yet we are receiving less in return.
Misuse and Underfunding in the Health Sector
Dr. Forson brought attention to the National Health Insurance Scheme's (NHIS) financial inefficiencies, pointing out that only 58% of NHIS money are used for genuine claims payments; the remaining funds are used for non-core purposes.
It is nearly impossible to allocate resources toward economic transformation because of these inflexible expenditures. He bemoaned, "We are spending more, yet we are receiving less in return.
Misuse and Underfunding in the Health Sector
Dr. Forson brought attention to the National Health Insurance Scheme's (NHIS) financial inefficiencies, pointing out that only 58% of NHIS money are used for genuine claims payments; the remaining funds are used for non-core purposes.
"Inefficiencies and financial leaks are crippling the NHIS, which is supposed to ensure healthcare for everyone," he said.
Education Expenditure Not Producing Outcomes
He expressed disapproval of the way education funds are distributed, pointing out that basic education is still underfunded even if spending is concentrated on secondary and university education.
He noted that "the majority of education funds go to wages rather than improving learning conditions, despite the fact that our children are our future."
Education Expenditure Not Producing Outcomes
He expressed disapproval of the way education funds are distributed, pointing out that basic education is still underfunded even if spending is concentrated on secondary and university education.
He noted that "the majority of education funds go to wages rather than improving learning conditions, despite the fact that our children are our future."
Infrastructure Projects Left Unfinished
Dr. Forson pointed to excessive spending on unfinished infrastructure projects, specifically Agenda 111, which spent $400 million over four years without a single hospital in operation. It would take an extra $1.5 billion to complete these projects. "We cannot continue spreading resources across too many projects without completing any. This approach is wasteful and unsustainable," he said. Energy Sector a Major Financial Burden
According to the minister, Ghana's energy sector costs the nation 2% of its GDP yearly, making it a major financial burden. Even though the government has transferred $2.1 billion in the last two years, the industry is still in distress, with financial deficits expected to reach $9 billion by 2026.
High generation costs, significant revenue losses at the Electricity Company of Ghana (ECG), and pricing that do not accurately represent costs are some of the main obstacles.
"Our economy is suffering due to the energy sector. It will become unsustainable without drastic changes, Dr. Forson cautioned.
High generation costs, significant revenue losses at the Electricity Company of Ghana (ECG), and pricing that do not accurately represent costs are some of the main obstacles.
"Our economy is suffering due to the energy sector. It will become unsustainable without drastic changes, Dr. Forson cautioned.
Reforms Are Needed Immediately
Dr. Forson proposed a number of reforms to address these inefficiencies, such as increasing the efficiency of public spending, reallocating funds to priority areas like infrastructure, healthcare, and education, and reforming state-owned enterprises (SOEs) like COCOBOD and ECG to minimize financial losses.
"We can't afford to keep making careless purchases. Poor financial decisions are having an impact on every Ghanaian. Discipline, accountability, and more prudent expenditure are needed now," he said.
Discussions about putting these important ideas into practice continue in the National Economic Dialogue.
In order to prevent corruption and poor management, he also advocated for the removal of unnecessary subsidies while safeguarding the weak and enforcing stringent financial and procurement management regulations.
Dr. Forson proposed a number of reforms to address these inefficiencies, such as increasing the efficiency of public spending, reallocating funds to priority areas like infrastructure, healthcare, and education, and reforming state-owned enterprises (SOEs) like COCOBOD and ECG to minimize financial losses.
"We can't afford to keep making careless purchases. Poor financial decisions are having an impact on every Ghanaian. Discipline, accountability, and more prudent expenditure are needed now," he said.
Discussions about putting these important ideas into practice continue in the National Economic Dialogue.
In order to prevent corruption and poor management, he also advocated for the removal of unnecessary subsidies while safeguarding the weak and enforcing stringent financial and procurement management regulations.