Thursday , 9 February 2023

Debt exchange programme was not discussed in Parliament – Dr Ato Forson

The Minority in Parliament has vowed to summon the Finance Minister, Ken Ofori-Atta to answer some key questions regarding government’s debt exchange programme.

Speaking in an interview on JoyNews’ PM Express on Monday, Dr Cassiel Ato Forson said Parliament was not briefed on the programme.

He also stated that the details programme was not captured in the 2023 Budget, adding that only one paragraph touched on debt exchange.

“He [Finance Minister] has not discussed this in Parliament. He took it out of Parliament and they want to avoid Parliament. Of course, we are going to ask an urgent question…The details are missing in Parliament. Parliament is the forum he should have brought this to Parliament for us to discuss, we are the elected representatives of the people,” he said.

The Ajumako Enyan Esiam MP expressed fear in the financial sector as a result of the debt exchange programme the Finance Minister wants to undergo.

“What they intend to do is just to give liquidity support to the financial sector. That fund is only there to give liquidity support to the financial sector, I want to know how much they intend to pay into that liquidity and where the money is coming from.  He said development partners, in what way, is it another loan?” he asked.

It would be recalled that on December 5, 2022, the Finance Minister announced a debt restructuring measure.

According to Mr Ofori-Atta, the objective was “to invite holders of domestic debt to voluntarily exchange approximately ¢137 billion of the domestic notes and bonds of the Republic, including E.S.L.A. and Daakye bonds, for a package of New Bonds to be issued by the Republic.”

However, the announcement has met several rejections by some stakeholders like the Chamber of Corporate Trustees of Ghana arguing that the structure of the programme will do more harm than good to investors under its umbrella.

Also, the Deputy Secretary General of the Trades Union Congress, Joshua Ansah has warned government not to touch pension funds in its planned debt exchange programme.

Meanwhile, the Deputy Finance Minister, Dr John Kumah has assured persons enrolled on pension fund schemes to exercise some calm as the government rolls out the debt exchange programme.

According to him, while there have been some fears about the government’s debt exchange programme adversely affecting funds in the trust of pension fund schemes, government has put in place measures to cushion the workers on the various pension schemes.

Speaking on JoyNews’ PM Express, he admitted that pension funds may be hit hard by the debt exchange programme, however, the government’s liquidity buffers have been put in place to ensure that these funds do not collapse.

He called on Ghanaians to trust government to protect their investments.

“Let me take the opportunity to calm the pension fund teachers and other unions who are concerned about the impact of the debt exchange programme on pension funds. The truth is that in the short term they may be hit, and the pensions fund may be hit by this exchange programme in terms of the interest and returns that they were expected to receive.

“But in the long term, they know that government bonds have been a trusted partner all this while, but we’re in a very difficult situation that if we don’t work together to redeem the market, we may all crash, and that is where we are.

“It’s like when you’re sick and you have to take bitter medicine to get better, it’s difficult to take the medicine, but as you drink the bitter medicine by the next day or two you begin to get well. This is where we are,” he said.

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