The Controller and Accountant-General, Kwasi Agyei, has warned that Ghana’s ballooning wage bill is becoming a major threat to fiscal sustainability, with public sector salaries consuming over 57 percent of the country’s domestic revenue.
He maintains that such a disproportionate wage burden is crowding out essential spending in critical sectors like health, infrastructure, and education.
Speaking at a media briefing in Accra organised by the African Association of Accountants General (AAAG), to unveil the Association’s third Annual Conference, Kwasi Agyei stressed the need for urgent reforms to ensure a more balanced and sustainable allocation of public resources.
“When you sum up all the money that has come and strike the average between 57 or 58 per cent goes into the salary we pay. This is a threat to fiscal sustainability,” he quipped.
“It means all the revenues that come, almost 60 per cent are used to pay salaries, which leads to a crowding-out effect which means we are not creating space for other prioritised government expenditure,” he said.
Labour Union in February accepted a 10% salary increase with President John Mahama calling on labour unions to be moderate in their wage demands for this year, assuring them that once the economy stabilises, he will ensure higher remuneration for workers.
Meanwhile the government is seeking to rein in expenditure to meet IMF programme targets.