Seth Terkper, Economic Policy Advisor at the Office of the President, has accused the previous New Patriotic Party (NPP) administration of suspending payments into Ghana’s Sinking Fund and depleting both the Sinking and Stabilisation Funds during its tenure.
Speaking on The Point of View on Channel One TV on Monday, June 30, Mr. Terkper alleged that the NPP government exhausted these critical fiscal buffers despite benefiting from revenue generated by three operational oil fields.
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When asked directly whether the NPP administration had halted the Sinking Fund, he replied, “Yes, they stopped it. They drew down, despite three oil fields.”
He emphasized that the current administration under President John Dramani Mahama is now working to restore both the Sinking Fund—used primarily for debt repayments—and the Stabilisation Fund, which cushions the economy during periods of fiscal stress.
We’re rebuilding the Sinking Fund [debt repayment account], and the Stabilisation Fund. They are structural, and they are your medium-term measures you need to stabilise the short-term gains you have made,” Terkper noted.
He argued that the previous government’s failure to replenish the funds after drawing from them, particularly during the COVID-19 pandemic, was a significant factor in Ghana’s eventual debt default.
If the debt repayment account was replaced and used, we wouldn’t have defaulted,” he asserted.
Terkper further indicated that the current government is committed to adhering to fiscal laws, including the Public Financial Management Act and the Petroleum Revenue Management Act, by making consistent contributions to both funds.
We’re complying,” he affirmed.
