The government has intensified its crackdown on payroll irregularities, warning that fraud, wrongful payments, and system delays are costing the state millions and undermining business confidence in public sector accountability.
Deputy Finance Minister, Thomas Ampem Nyarko, told Parliament’s Public Accounts Committee (PAC) that investigations are underway into cases of payroll fraud and the slow reinstatement of genuine workers who are wrongly removed from the system.
“We’ve come across allegations of payroll-related fraud issues that we have asked the investigation agencies to investigate. Because the system tracks activation and deactivation, it is possible to identify the individuals responsible,” he explained.
The PAC hearings, currently reviewing the 2024 Auditor-General’s report, revealed how errors and manipulation in payroll management are inflating the government’s wage bill.
Experts warn this directly impacts the fiscal space available for development projects, while raising concerns for businesses dependent on timely payments from government contracts.
Chairperson of PAC, Abena Osei Asare, questioned why validated staff are often delayed in being restored to the payroll, and why some rural banks are holding on to wrongful payments instead of refunding them. Such practices, she said, undermine trust in the system and divert funds that could strengthen the economy.
Controller and Accountant-General, Kwasi Agyei, admitted that wrongful payroll payments remain a serious challenge and disclosed that the Ministry of Finance is collaborating with his office to recover funds withheld by banks.
“You can’t have public funds sitting in your account even when it’s been flagged as wrongful payment. Those monies belong to the state and must be refunded immediately,” he stressed.
To tighten oversight, the Controller announced a new public reporting system, including phone lines and email channels at regional offices for citizens to report payroll irregularities and fraud.
He also revealed that payroll validators will now be held personally accountable for approving names of employees who have not worked.
Analysts say payroll fraud has wider economic implications. Every cedi lost through irregularities inflates government expenditure and could worsen borrowing needs, placing additional pressure on businesses through potential tax hikes.
At the same time, delays in reinstating legitimate employees affect livelihoods, reduce productivity, and weaken morale in public service delivery.
The Ministry’s crackdown is therefore seen as a critical step toward restoring efficiency and confidence in Ghana’s payroll system, ensuring that taxpayers’ money is spent on genuine workers while preventing leakages that distort the national budget.
