To enhance the quality and transparency of the decisions made by the Monetary Policy Committee of the Bank of Ghana, Economist, Prof. John Gatsi wants each member of the committee to write his own verdict accompanied by reasons for that verdict for the consumption of the public.
The Dean of the University of Cape Coast Business School believes the current convention when after the Monetary Policy Committee Meetings, the governor will organise a press conference to announce a purported unanimous decision of the committee is too opaque and lacks transparency.
Just as it’s done in the court where all judges write their individual judgments on the case at hand, Prof. John Gatsi is advocating for a replication of the same at the MPC where each member writes his considered view on the decision the member believes is appropriate and reasons for the decision.
The pressure of the public reading the individual verdicts of the Monetary Policy Committee members, Prof. John Gatsi says will serve as a watchdog on members to make informed and appropriate decisions in the interest of the country.
The economist in an interview with The High Street Journal insisted that he believes that even if there was a vote, the reasons for the stance of each member either on the majority or the minority sides must be known by the general public.
“That is crucial to attaining a higher level of transparency, disclosure, and accountability,” Prof. Gatsi emphasized.
He further explained that “if you know that the public will read your decision and make informed decisions about you, then your decision will be a policy decision. Your decision will not be compromised. Even if they voted and you didn’t win, we will read and know that ABCD has considered this particular area and thought that this particular area should influence the decision but they didn’t vote in that direction.”
“This will beef up the quality of the decisions that we make but now every decision is opaque. They just give us what they want to tell us,” he added.
Commenting on the recent development where days after a major policy rate cut by the MPC, inflation which has been on a downward trajectory for months increased, the economist indicated the development is one of the more reasons why transparency in the decisions must be made public.
“If the individual decisions taken are disclosed, perhaps you would not see a situation like this where you reduce the policy rate by 200 basis points then the next day inflation increases,” he noted.
Prof. Gatsi says such transparency would have exposed the inflation expectations of the individual committee members and how they influenced their decisions.
