In a recent discussion at the NorvanReports and Economic Governance Platform (EGP) X Space discussion on the topic, “Resetting The Economy: Can Ghana’s 2025 Budget Achieve Fiscal Stability and Sustainable Growth”, held on Sunday, March 16, 2025, the Chief Executive Officer (CEO) of Dalex Finance, Joe Jackson, proposed that the government develops a repayment programme aimed at clearing the GH¢ 67.5 billion arrears owed to contractors and suppliers.
Jackson outlined his proposal, stating that it should involve a “20% haircut on the total amount, with 40% of the total amount offered to contractors and suppliers in long-term bonds.” He further noted that “the remaining 40% of the total amount, he noted, should be paid in cash to contractors and suppliers.”
Reflecting on the challenges of clearing such arrears in one budget cycle, Jackson commented: “I don’t think it is anywhere realistic to expect that the GH¢ 67.5bn arrears will be cleared in this budget. I think what should be done is that the government comes up with a programme to renegotiate with contractors and suppliers.”
He added: “For me, I think the programme should be one where contractors and suppliers take a 20% haircut, 40% is given in long-term bond, and the remaining 40% is paid in cash.”
In related developments, during the presentation of the 2025 Budget Statement and Economic Policy in Parliament on Tuesday, March 11, Dr. Forson highlighted that by the end of December 2024, the total central government arrears had reached GH¢67.5 billion—equivalent to 5.2% of Ghana’s GDP.
“At the end of December 2024, total central government arrears amounted to GHS67.5 billion, representing 5.2% of GDP. Mr. Speaker, with the road sector recording arrears of GHS21 billion,” Dr. Forson stated.
Upon taking office on January 23, 2025, the Finance Minister reported receiving numerous payment requests from contractors and suppliers. “Subsequently, Mr Speaker, the MoF held a special hearing with the MDAs to validate the arrears submitted for payment. The response from the MDAs revealed that a staggering amount of GH¢67.5 billion is owed to government contractors and suppliers,” Dr. Forson explained.
The arrears broken down amount to a GH¢49.2 billion in outstanding interim payment invoices from the MDAs and GH¢18.3 billion in bank transfers recorded by the Controller and Accountant General’s Department.
