Mahama Promises NDC Will Reintroduce Sinking Fund

During a recent appearance on the GTV presidential encounter series on November 29, 2024, former President John Dramani Mahama presented a series of key proposals aimed at addressing the country’s growing economic challenges. Among his notable plans was the re-establishment of a sinking fund, a financial strategy designed to tackle Ghana’s rising debt.
To finance this sinking fund, Mahama emphasized his intention to utilize the Petroleum Revenue Management Act, 2011 (ACT 815). This legislation outlines how revenues from Ghana’s petroleum sector are to be managed, including allocations to the Heritage Fund, Stabilization Fund, and the Annual Budget Funding Amount (ABFA). Mahama’s proposal aims to restructure the allocation of petroleum revenues by reducing the proportion of funds that currently go to the Ghana National Petroleum Corporation (GNPC).
Rather than the 70% of petroleum revenue that is presently directed to GNPC for its activities, Mahama suggested that a new, separate account be created to hold the ABFA funds. These funds would then be allocated specifically to the ABFA’s intended uses, with any savings from this arrangement being channeled into the sinking fund. According to Mahama, this restructuring would prevent wasteful spending by the GNPC and ensure that the corporation uses its allocated funds more effectively.
In his analysis of Ghana’s current financial situation, Mahama warned that the country’s debt profile was unsustainable. He pointed to a looming crisis in 2026 and 2027 when Ghana will be required to pay a staggering GH¢182 billion—far exceeding the total government budget, which is just over GH¢70 billion. Mahama argued that such a large debt payment in a single year was unrealistic and could lead to another debt default. He proposed renegotiating the terms of Ghana’s debt in order to smooth out these large payment peaks, making the debt more manageable in the long term.
If elected, Mahama said the first 90 days of his presidency would focus on transparent engagement with the Ghanaian people and stakeholders to fully assess the country’s debt and economic situation. This process would include discussions with creditors to restructure Ghana’s debt profile in a way that would be more sustainable and better aligned with the country’s fiscal capacity. He stressed that this open dialogue would be crucial in rebuilding the country’s financial credibility and ensuring that future debt payments would not overwhelm the national budget.
On the subject of taxation, Mahama vowed to overhaul Ghana’s tax system, focusing on making it more equitable and transparent. He proposed scrapping some controversial taxes, such as the Electronic Levy (E-levy), which he believes burdens citizens unnecessarily. Instead, he would seek to rationalize the entire tax system, eliminating inconsistencies and streamlining tax collection processes. Mahama highlighted that the current system leads to tax evasion due to discrepancies in VAT rates across similar businesses. By making the tax system more efficient and easier to navigate, Mahama argued that the country could increase tax revenues and bring more individuals and businesses into the formal tax net.
Mahama also addressed the challenges within the education sector. He reiterated his commitment to abolishing the double-track system, a policy that was introduced to accommodate the increased number of students. His goal is to ensure that all students can attend school together without being divided into two separate tracks, which would improve the quality of education and create a more efficient school system.
In his plans to combat illegal mining, or “Galamsey,” Mahama proposed the introduction of a reclamation bond for small-scale miners. This initiative would hold miners accountable for restoring the environment after their operations. Furthermore, he suggested that landowners who lease their land for illegal mining activities should also be held responsible for the damage caused.
Finally, Mahama urged Ghanaians to make their voices heard in the upcoming elections on December 2, 2024. He called on the media, the police, and all citizens to actively participate in the voting process, which he described as a critical moment for the country. He concluded his remarks by saying, “Ghanaians have given you a penalty to score the goal of change.” He emphasized that a victory for his party would usher in much-needed transformation and a new chapter in Ghana’s development.