The NPP Flagbearer, Dr Mahamud Bawumia set the tone for his presidential bid by outdooring his vision for the country on Wednesday night.
In a speech that lasted well over three hours, employing a three-step approach, Dr Bawumia explained the boom-to-bust economic trajectory of the Akufo-Addo administration with the ready alibi of the double whammy of COVID-19 and the Russian-Ukraine War, before touting the achievements of the Akufo-Addo administration and finally presenting his vision to the nation he seeks to lead.
Even before the speech, Dr Bawumia indicated in a promotional video for the event that his policies may take a different path despite the fact that it is grounded in the same philosophy of the NPP.
And true to form, he said in his speech “As Vice-President, I am like a driver’s mate. But if, by the Grace of God, you make me President, I will be in the driver’s seat with constitutionally mandated authority to pursue my vision and my priorities. So, what do I want to do in terms of vision, priorities and policies if you give me the opportunity, by the Grace of God, to become President of the Republic of Ghana?”
This piece highlights five ways, Dr Bawumia endeavoured to chart his own path, distinct from the Akufo-Addo legacy as he laid out his vision for the country.
1. TAX POLICY
The Oxford Trained Economist’s segue into politics was premised on the card of competence in Economics, finance and tax policy among others. Expertise that made him the perfect candidate for the role as the leader of the Economic Management Team in his capacity as Vice President.
However, in outlining his vision, he sought to re-hash the “from taxation to production” mantra that defined the economic policy of the Akufo-Addo alternative in opposition, but seems to be in tatters after seven years of governance with an economy under an IMF programme.
A bitter cocktail of taxes buoyed on by a ravishing appetite to increase revenue at the mercy of Ghanaians seems to be the reality in Ghana today but the Vice President at the event, without saying it plainly, suggested that the status quo is the legacy of President Akufo-Addo with him as the “driver’s mate” without the ultimate mandate and responsibility.
In his vision, he promises a clean break from the past riddled with taxation, putting forward the proposal of a flat rate scheme and the abolition of taxes provided the fiscal space allows it.
Hear him “With cuts in government expenditure, the private sector undertaking expenditure that would normally be done by government and the new tax regime that will enhance compliance, broaden the tax base, and increase tax revenue, the situation we are going to face in 2025 is going to be very different from the situation we faced in 2020 and 2022.
With the policy measures implemented thus far, we have outperformed the IMF fiscal deficit target of 5% of GDP by attaining a fiscal deficit of 4.2% in 2023. The new policies that I am proposing to implement in 2025 will give us the fiscal space to eliminate some taxes such as the VAT on electricity, the emissions tax and the betting tax without compromising our deficit target.”
2. LEAN GOVERNMENT
President Akufo-Addo is notorious for the size of his government, second to none in the fourth republic. In an interview in March 2017, he justified the size of his government saying” I’m aware that people are concerned about what they see as maybe the cost of this large government. It is a necessary investment to make for the rapid transformation of this country.
The ministers “are coming to work, it is not going to be a holiday”. He downsized the number of ministers and deputies from over 110 in his first term to a lesser figure in his second term, but size of his government is still a cause for concern any time discussions about cutting down waste and duplicitous roles in the public sector come up.
Dr Bawumia in his vision favours a lean government. He is promising an even leaner government than that of his main competitor, John Mahama. Mahama has committed to a number of 60 Ministers and Deputies, Bawumia is promising 50.
He said, “The move towards the private sector provision of many public services would create fiscal space of at least 3% of GDP. This represents a major paradigm shift. Additionally, an efficient system of governance will require even fewer ministers. Therefore, I would have no more than 50 ministers and deputy ministers.”
3. INFRASTRUCTURE FINANCING
From the Sino-Hydro deal, to GETFUND Securitization to the botched Agyapa deal, the Akufo Addo administration has plainly expressed its penchant for an infrastructure financing model that securitizes or collateralizes government tax proceeds or the nation’s natural wealth for a frontload of resources to undertake infrastructure projects. With the Sino-Hydro deal, the road projects, interchanges and others were hedged against the bauxite resources in the Atewa forest to be exploited by the Chinese.
To improve the infrastructure stock supporting Akufo-Addo’s Free SHS policy, government securitized GETFUND proceeds for an amount of 1.5 billion dollars. The Agyapa deal essentially was set up to collateralize gold receipts channeled through a special purpose vehicle for the purposes of securing bulk funds to finance big ticket infrastructure projects across the country but that never saw the light of day after series of setbacks.
Notwithstanding, how complex these arrangements are, these deals have been favored by the Akufo-Addo administration probably influenced by the cutting-edge investment banking background of the regime’s Finance Minister, Ken Ofori-Atta.
However, Dr Bawumia per his vision, is advocating a new path-a variant of the private-public partnerships to finance infrastructure.
He says “The private sector will be encouraged to build roads, schools, hostels, and houses for government to rent or lease to own. The demand for roads construction is massive and this has historically placed a huge burden on the budget. I believe that the private sector should finance the construction and maintenance of roads through PPP concession arrangements.
Also, government will move towards leasing rather than purchasing vehicles, printing equipment, etc. The private sector will have the responsibility for maintaining the equipment. With this approach, the budget can save very significant outright cash expenditure annually from various items across different Ministries, Departments and Agencies. This policy will energize the private sector and create many jobs.”
Quite novel, but that’s what he seeks to do, questions about the procurement methods to be employed for such an initiative among others are questions that will be asked in the course of 2024’s rigorous campaign season.
4. GREATER SHARE OF THE EXTRACTIVES SECTOR FOR GHANAIANS
The recent conversation about the ownership of Ghana’s Lithium reserves discovered at Ewoyaa in the Central Region brought to the fore concerns about natural resource governance and how much of a stake Ghanaians own in their own natural wealth.
From the Guggisberg type lopsided agreements that offer only paltry percentage share of revenue, royalties and taxes, many want a higher stake in mining revenue or the mineral should be left underground.
The argument gets interesting however, when the position is advanced that the lack of investment by the state in the risky phase of prospecting and exploration means the state will continue to earn peanuts when such discoveries are made. This has been an age old resource problem from the colonial era.
Dr Bawumia, per his vision wants to change that. He argues “My government will provide the Geological Survey Department and our universities with resources annually to undertake a mapping of areas where we have gold reserves. As a matter of policy, we will legislate that concessions in these areas with proven reserves will be 100% Ghanaian owned since with proven gold reserves, we can easily raise the capital required and hire the expertise.”
5. LONG TERM ECONOMIC PLANNING
When President Akufo-Addo took office, the erstwhile NDC government had already caused a 40-year development plan to be drawn up under the leadership of Dr Nii Moi Thompson.
The President in an interview indicated that he was not interested in implementing such a plan. In line with Constitutional edict in Article 37, he introduced his Seven-year development plan to Parliament.
From Dr Bawumia’s speech, it seems that unlike his boss, he is interested in a long-term planning that has bi-partisan input and buy-in.
“I believe we can find broad contours of a national development plan for which we can find consensus in areas such as education, health, industrialization, environment etc. I will support such a consensus national development plan. Specifically, I will propose to amend Article 87 of the 1992 Constitution as well as the NDPC Act (Act 479) to mandate political party manifestoes, and consequently Economic and Social policies of governments, as well as budgets, to be aligned to the agreed on broad contours in specific sectors,” he promised.
It is noteworthy that the 2024 electioneering has kicked off on a policy note promising to be issue-based rather than one fueled by invectives and name calling.
That’s a positive development for Ghana’s democracy. As the campaign proceeds, it will be interesting to note how Dr Bawumia navigates the landmines associated with the legacy of Akufo-Addo while projecting his own vision and set of policies.