Business & EconomyHome Featured

Analysis: Ghana’s parliamentary arithmetic puts budget approval at risk

If the budget does not come into effect beforehand, the implications for government business are serious, writes Kobi Annan

GHANA’S budget was voted through after days of confusion and two contested votes, but it is not out of the woods. The bill was initially rejected by opposition New Democratic Congress (NDC) MPs on Friday November 26 and then passed when only the majority New Patriotic Party (NPP) MPs voted on the afternoon of November 30 – this time the minority walked out. The legality of the vote is in dispute. There are two deadlines for resolving the issue – the upcoming parliamentary recess and  December 31, after which the budget should come into effect. If the budget does not come into effect beforehand, the implications for government business are serious.

Significance – rival votes

Since the December 2020 election, Ghana has been working with a near-hung parliament – 137 MPs for the opposition NDC, 137 for the ruling NPP and one independent. Earlier in the year, we flagged the risk this poses to legislative activities, especially around contentious issues, the passage of the budget being one. This appears to have come to fruition. The minority in Parliament signalled their intent to oppose the budget immediately after it was read on  November 17. Their main contention was with a proposed 1.75 percent levy on all digital transactions (E-Levy) but also with a 15 percent increase in all official government fees and charges. The E-Levy had drawn widespread criticism from stakeholders including operators in the mobile money space.

The narratives of what transpired before the respective votes on Friday and Tuesday are plentiful and conflicting. To simplify:

On Friday, November 26, the majority side walked out of the chamber to boycott proceedings. In their absence, the speaker Alban Bagbin held a vote on the budget statement and the 137 minority members present voted to reject it. Following this, the NDC released five points that it wanted addressed before it would consider passing the budget. On Tuesday, November 30, meetings between the NDC and NPP were being held to come to a compromise.

Representatives from both sides have confirmed that progress was being made and a resolution was close. However, there appears to have been some disagreement over the way the amended text would be presented and to quote NDC MP Muntaka Mubarak, ‘either we agree on everything, or we agree on nothing.’ This led to the NDC boycotting parliament and in their absence a vote was held by the First Deputy Speaker, Joe Osei Owusu (himself an NPP MP) in which the budget was approved by 138 members of the majority side.

The issue now being raised by the minority is that the 138 members who voted on  November 30 allegedly included Osei Owusu who is not supposed to vote when acting in the capacity as a speaker. The minority filed a motion on December 1  to set aside the acceptance of the budget due to this fact, but it was thrown out by Osei Owusu on the same day. A private citizen and journalist/lawyer, Richard Dela Sky, has lodged two suits at the Supreme Court seeking to clarify the legality of the two votes that were held, effectively challenging the actions of both Bagbin and Osei Owusu.

Bagbin was formerly an NDC MP, and his appointment is the first time in Ghana’s Fourth Republic that the position has been held by an opposition member. He has been a controversial speaker during his short tenure thus far. For example, shielding MPs from police prosecution and attempting to order ministries to overturn directives. There have been allegations that he has been partisan in some of his decision making, allegations which have incentivised the minority to become very protective of ‘their man’. In the aftermath of the November  26 vote, they raised concerns over what they saw to be unfair treatment of Bagbin. This could lead to attempts to frustrate parliamentary business. Speaking to local media in relation to the matter one NDC MP told the host that ‘we won’t call it a threat but, if necessary, we will demand a vote on every single provision in the 2022 budget statement.’

Outlook – bills come due

Regarding the legal process now underway, Article 104 Clause 1 of Ghana’s constitution states that legislation requires a ‘majority of members present and voting with at least half of all the members of parliament present.’ Article 104 Clause 2 states that the speaker ‘shall have neither a casting nor original vote.’ The legality of both the November 26 vote rejecting the bill, and the  November 30 bill passing the vote, therefore appear vulnerable, assuming Richard Dela Sky’s two writs have been tightly structured.

The question that then remains concerns timing. A Supreme Court ruling could take weeks and, if the votes are both overturned, negotiations must restart before a vote can be held, the budget approved, and then passed through relevant committees. There are two hard deadlines – the first being the December recess of Parliament and the second is  December 31, the 2022 budget runs from  January 1 so must be approved before then. A failure to approve the budget before the end of the year would mean a shutdown of non-essential government activities, non-payment of government salaries and potentially missed debt repayments.

There are other avenues forward. MPs from both sides admitted that a compromise was near, with government reportedly willing to scrap the controversial Agyapa royalties agreement and reduce the E-Levy from 1.75 percent to 1.5 percent (potentially even lower after consultation with stakeholders). Failure to reach a compromise would carry political costs for both sides of the house – parliamentarians may be more sensitive to having seen popular discourse over the past few days.

Kobi Annan is a Consultant with Songhai Advisory, an African-owned and managed firm delivering local knowledge supporting transformative and sustainable strategic decision-making


Related Articles

Leave a Reply

Your email address will not be published.

Back to top button