Public officers who misappropriate the country’s financial resources will now receive a 5-year jail sentence if found guilty by the law.
The minimum jail sentence for such offense is pegged at 6 months.
This is contained in the new Public Financial Management Bill, 2016 which has been passed into an Act by the Parliament of Ghana on Wednesday, August 3, 2016.
The jail sentence was agreed by Members of Parliament during the consideration stage of the Bill.
There were initial disagreement over the maximum number of years to be slapped on any public official who flouts the law.
While some were opting for a minimum of six months jail sentence and a maximum of two years, others too proposed for three months minimum and five years maximum jail sentence.
However, upon further deliberations over the issue, a consensus was reached, with Members pegging the maximum jail term to five years and a minimum six months prison term.
The new law seeks to consolidate existing laws to regulate the financial management of the public sector within a macroeconomic and fiscal framework as well as define the responsibilities of persons entrusted with the management and control of public funds, assets, liabilities and resources.
The Public Financial Management Bill forms part of the country’s ongoing public financial management reforms which are designed to address persistent weaknesses and promote discipline, transparency and accountability in the management of public funds.
This is against the backdrop of systemic weaknesses including lack of credibility in the budget process, unpredictability during budget execution, limited expenditure controls and cash rationing all of which contribute to the problem of chronic and persistent arrears.
Chairman of the Finance Committee, James Klutse Avedzi told Parliament that the law will address the lamentation of the Auditor General and the Public Accounts Committee (PAC) over lack of commitment to punish public officers cited for financial malfeasance.
The law introduces a number of significant process improvements in fiscal development principles and practices, public financial management, debt management and budget execution that have been introduced over the years but which are not reflected currently in legislation.
The new law, he added, also provides for the macroeconomic, fiscal, regulatory, accounting and accountability framework for dealing with the management of money and property of Government.
It also addresses the persistent weakness in fiscal failures in accountability mechanisms and provides a clear budget process map that strengthens the link between fiscal strategy and policy.
The Bill also intends to ensure that public funds are sustainable and consistent with the level of public debt and also make provision for accounting and audit of public funds.
Clause 105 of the Bill states that the Finance Minister may issue guidelines for the effective implementation of the resultant Act but that clause was shot down by the minority with the Ranking Member of the Finance Committee, Dr Anthony Akoto Osei and the MP for Sekondi, Papa Owusu Ankomah playing a key role.
The duo had argued strongly that the clause will give the Finance Minister the chance to alter the direction of the Act for political convenience without recourse to Legislature.
Clause 107 of the Bill also says that the Minister may, by legislative instrument, make regulations (i) for the operation of public account (ii) for the recording and controlling of expenditure commitments and payments (iii) for the administration of the Contingency Fund (iv) for the management of government assets, (v) for the management of government debts (vi) for audit committees, (vii) and for claims and write offs of public funds (viii) for the limit on borrowing by local government authorities (ix) for the limit on borrowing by public corporations and state owned enterprises (x) for penalties under this Act (xi) for the implementation of the Treasury Single Account established under section 46 (xii) prescribing the manner in which the minister may, without parliamentary approval, abandon and remit claims by or on behalf of government or service to the government.
However, Haruna Iddrisu, Minister for Employment and Labour Relations told the House that clause will be a bad precedent for sweeping privileges to be given to the Finance Minister without consulting with Cabinet.
In his view, the Finance Minister must do all these things in consultation with Cabinet because the minister operates under the Executive and Cabinet.
The two clauses were therefore stood down by the Speaker and deferred for further consultations until they were amicably resolved before passage of the Bill.