Government of Ghana’s Budget: Its Functions, Coverage, Classification, and Integration with Chart of Accounts
Government budgets are the primary instruments for formulating and implementing a country’s fiscal policy objectives, development priorities, and the overall socio-economic aspirations of its people. Thus, in this paper, the author examined the Government of Ghana’s budgets with respect to their functions, coverage, classifications, and integration with the country’s chart of accounts. The author did so by amalgamating the research findings of extant literature with (a) the operational and procedural guidelines underpinning the formulation and execution of the government’s budgets; (b) the recommendations made by various development partners and thinktanks on reforming the country’s budgeting processes and procedures; and (c) the lessons Ghana could learn from the budget reform efforts of other countries. By way of research findings, the paper showed that the Government of Ghana’s budgets in terms of function are both eclectic and multidimensional. On coverage, the paper showed that the country’s budgets duly cover the revenues and expenditures of the general government (i.e., both the central and sub-national governments). Finally, on classifications, the paper noted with delight the Government of Ghana’s effort in providing classificatory codes to both its national development agenda and such international development goals as the AU’s Agenda 2063 and the UN’s Sustainable Development Goals. However, the paper found some significant lapses that require a complete overhaul and structuring on the integrations of its budget classifications with its chart of accounts. Thus, the paper concluded with a detailed examination of the challenges confronting the country’s current chart of accounts and recommendations for addressing them.
[1] IMF’s. (2014). Government Finance Statistics. International Monetary Fund, 1986. Available https://www.imf.org/external/Pubs/FT/GFS/Manual/2014/gfsfinal.pdf accessed on September 2, 2020.
[2] Tommasi, D. (2013). Chapter 8: ‘The coverage and classification of the budget’. In: Allen R, R Hemming & BH Potter (Eds.) The International Handbook of Public Financial Management. Basingstoke, UK and New York, Palgrave Macmillan.
[3] Jacobs, P.D., Hélis, J.L. and Bouley, D. (2009). Budget Classification. IMF, Fiscal Affairs Department. Available from https://www.imf.org/external/pubs/ft/tnm/2009/tnm0906.pdf accessed on March 7, 2019.
[4] PEFA. (2016). Framework for Assessing Public Financial Management. Available at <https://www.pefa.org/resources/pefa-2016-framework> accessed on September 3, 2020.
[5] Cooper, J.P., and Pattanayak, S. (2011). Chart of Accounts: A Critical Element of the Public Financial Management Framework. Washington, DC: International Monetary Fund. Available at <https://www.imf.org/external/pubs/ft/tnm/2011/tnm1103.pdf> accessed on September 3, 2020.
[6] Abdulai, M. S. (2020). “Public Financial Management in Ghana: A Move beyond Reforms to Consolidation and Sustainability.” International Journal of Industrial and Manufacturing Engineering. 14 (6): 424-438.
[7] Abdulai, M. S. (2020). “Government of Ghana’s Budget: An Assessment of its Compliance with Fundamental Budgeting Principles”. International Journal of Economics and Management Engineering, 14(10), 1018 - 1036.
[8] Sundelson, J. W. (1935). “Budgetary principles.” Political Science Quarterly. 50(2): 236-263.
[9] Ghana’s Public Financial Management Act (Act 921). Available at <https://acts.ghanajustice.com/actsofparliament/public-financial-management-act-2016-act-921/> accessed on January 19, 2020.
[10] Stourm, Rene (1917). The Budget. Translated by Thaddeus Plazinski. New York: D. Appleton and the Institute for Government Research
[11] Schiavo-Campo, S. 2007. Chapter 2: ‘The budgeting and its coverage’. In A. Shah (Ed), Budgeting and budgetary institutions (Public Sector Governance and Accountability Series: pp. 53-88). Washington DC: The World Bank
[12] Malgwi, A. A., & Unegbu, A. O. (2012). Budget in Nigerian public sector: Need for balanced scorecard perspective. International Journal of Finance and Accounting, 1(2):1-6.
[13] Ackoff, Russell L. 1979. “Resurrecting the future of operational research.” Journal of the Operational Research Society, 30(3): 189-199.
[14] Pattaro, Anna F. 2016. “Budgetary Principles”. Global Encyclopedia of Public Administration, Public Policy, and Governance, 1-8.
[15] Ministry of Finance (MoF) Ghana. 2015. The Budget Operational Manual for Development of National Budget. Available at https://studydaddy.com/attachment/165976/GHANA+BUDGET+OPERATIONS+MANUAL.pdf. Accessed on September 5, 2020.
[16] Khan, A., & Hildreth, W. B. (2002). Budget Theory in the Public Sector. Greenwood Publishing Group. Available at https://erl.ucc.edu.gh/jspui/bitstream/123456789/2979/1/%5BAman_Khan%2C_W._Bartley_Hildreth%5D_Budget_Theory_in_%28BookZZ.org%29.pdf. Accessed on September 5, 2020.
[17] Neuby, B. L. (1997). “On the lack of a budget theory”. Public Administration Quarterly: 131-142, p. 132.
[18] Hyde, Albert C. 1992. “The Development of Budgeting and Budget Theory: The Threads of Budget Reform.” In A.C. Hyde (ed.), Government Budgeting: Theory, Process, Politics. Pacific Grove, CA: Brooks/Cole Publishing, 1992: 1–6.
[19] IMF. 2014. Government Finance Statistics. International Monetary Fund, 1986. Available https://www.imf.org/external/Pubs/FT/GFS/Manual/2014/gfsfinal.pdf accessed on September 2, 2020.
[20] Ministry of Finance (MoF). 2020. “2020 Budget Estimates of Ministries, Departments and Agencies.” Available at https://www.mofep.gov.gh/publications/budget-estimates/2020. Accessed on September 5, 2020.
[21] Abdulai, Mohammed S. 2020. “Public Financial Management in Ghana: A Move beyond Reforms to Consolidation and Sustainability.” International Journal of Industrial and Manufacturing Engineering. 14 (6): 424-438.
[22] Diamond, J. 2013. “Good Practice Note on Sequencing PFM Reforms.” PEFA. Available at https://blog-pfm.imf.org/files/sequencing-v8 good_practice_note_on_sequencing_pfm_reforms_jack_diamond__january_2013_1.pdf. Accessed on September 5, 2020.
[23] The Republic of Ghana. 2019. Ghana: Voluntary National Review (VNR) Report on the Implementation of the 2030 Agenda for Sustainable Development. Prepared and Presented by the Government of Ghana. Available at https://sustainabledevelopment.un.org/content/documents/23420Ghanas_VNR_report_Final.pdf accessed on September 19, 2020.
[24] Kilpatrick, W. (1936). Classification and measurement of public expenditures. The Annals of the American Academy of Political and Social Science, 183(1), 19-26.
[25] Dupré, J. (2006). Scientific classification. Theory, culture & society, 23(2-3), 30-32.
[26] Hunter, M. H. (1930). The Problem of Classification: Public Expenditures and Revenues. The American Economic Review, 46-53.
[27] IBP. (2016). Guide to the open budget questionnaire: An explanation of the questions and the response options. Available at <https://www.internationalbudget.org/wp-content/uploads/open-budget-survey-2017-guide-and-questionnaire-english.pdf > accessed on January 19, 2020.
[28] OECD. (2008). OECD glossary of statistical terms. Organization for Economic Co-operation and Development. Available at <https://stats.oecd.org/glossary/detail.asp?ID=6152#:~:text=The%20term%20international%20statistical%20standard,organisations%20working%20with%20national%20agencies > accessed on October 24, 2020.
[29] Richard, A., & Daniel, T. (Eds.). (2001). Managing Public Expenditure: A Reference Book for Transition Countries. OECD Publishing.
[30] IMF (2021). IMFx GFSxGovernment Finance Statistics. Available at < https://learning.edx.org/course/course-v1:IMFx+GFSx+1T2021/home> accessed on July 20, 2021.
[31] IBP. (2016). Guide to the open budget questionnaire: An explanation of the questions and the response options. Available at <https://www.internationalbudget.org/wp-content/uploads/open-budgetsurvey-2017-guide-and-questionnaire-english.pdf > accessed on January 19, 2020. accessed on January 19, 2020.
[32] World Bank (2021). World Development Indicators. Available at <Compensation of employees (% of expense) - Ghana | Data (worldbank.org)>
[33] World Bank. (2017). Fiscal consolidation to accelerate growth and support inclusive development: Ghana public expenditure review. World Bank. Available at < https://documents1.worldbank.org/curated/en/972961498157963462/pdf/Ghana-PER-FINAL-June-19-2017.pdf>
[34] World Bank (2021). World Banks Development Indicators. Available at <Subsidies and other transfers (% of expense) - Ghana | Data (worldbank.org)>
[35] Kim, J. M. (Ed.). (2006). From Line-item to Program Budgeting: Global lessons and the Korean case. Korea Institute of Public Finance.
[36] MoF, (2018). Revised PBB Manual. Available at < https://mofep.gov.gh/sites/default/files/news/Revised-PBB%20Manual.pdf> Accessed on January 24, 2022
[37] Robinson, M. (2013). Program Classification for Performance-Based Budgeting. World Bank, Washington, DC. Available at <https://openknowledge.worldbank.org/bitstream/handle/10986/21767/959380PUB0perf00Box391429B00PUBLIC0.pdf?sequence=1> accessed on January 24, 2022
[38] PEMPAL, (2014). Integration of the Budget Classification and Chart of Accounts Good Practice among Treasury Community of Practice Member Countries. Available at < https://www.pempal.org/sites/pempal/files/good_practice_design_of_coa_in_tcop_member-countries_eng.pdf> Accessed on January 24, 2022
[39] IMF Afritac West 2 (2019). Ghana Reviewing and Refining: The Structure and Efficiency of Chart of Accounts.
[40] Biletska N. (2011). Budget classification: Basic PFM training program the World Bank Group. Available at <https://view.officeapps.live.com/op/view.aspx?src=https%3A%2F%2Fweb.worldbank.org%2Farchive%2Fwebsite01531%2FWEB%2FIMAGES%2FBUDGETCL.PPT&wdOrigin=BROWSELINK> Accessed on January 24, 2022
[41] IMF Afritac West 2 (2019). Reorganization of the Controller and Accountant General’s Department and Review of Core Functions.
[42] UN’s Sustainable Development Goals. Available at https://www.imf.org/en/Topics/SDG Accessed on January 24, 2022
[43] AU’s Agenda 2063 Goals. Available at <https://www.facebook.com/Academy2063/photos/did-you-know-that there-are-20-goals-under-agenda2063-if-so-can-you-name-them-we/157973329084398/> Accessed on January 24, 2022
[1] IMF’s. (2014). Government Finance Statistics. International Monetary Fund, 1986. Available https://www.imf.org/external/Pubs/FT/GFS/Manual/2014/gfsfinal.pdf accessed on September 2, 2020.
[2] Tommasi, D. (2013). Chapter 8: ‘The coverage and classification of the budget’. In: Allen R, R Hemming & BH Potter (Eds.) The International Handbook of Public Financial Management. Basingstoke, UK and New York, Palgrave Macmillan.
[3] Jacobs, P.D., Hélis, J.L. and Bouley, D. (2009). Budget Classification. IMF, Fiscal Affairs Department. Available from https://www.imf.org/external/pubs/ft/tnm/2009/tnm0906.pdf accessed on March 7, 2019.
[4] PEFA. (2016). Framework for Assessing Public Financial Management. Available at <https://www.pefa.org/resources/pefa-2016-framework> accessed on September 3, 2020.
[5] Cooper, J.P., and Pattanayak, S. (2011). Chart of Accounts: A Critical Element of the Public Financial Management Framework. Washington, DC: International Monetary Fund. Available at <https://www.imf.org/external/pubs/ft/tnm/2011/tnm1103.pdf> accessed on September 3, 2020.
[6] Abdulai, M. S. (2020). “Public Financial Management in Ghana: A Move beyond Reforms to Consolidation and Sustainability.” International Journal of Industrial and Manufacturing Engineering. 14 (6): 424-438.
[7] Abdulai, M. S. (2020). “Government of Ghana’s Budget: An Assessment of its Compliance with Fundamental Budgeting Principles”. International Journal of Economics and Management Engineering, 14(10), 1018 - 1036.
[8] Sundelson, J. W. (1935). “Budgetary principles.” Political Science Quarterly. 50(2): 236-263.
[9] Ghana’s Public Financial Management Act (Act 921). Available at <https://acts.ghanajustice.com/actsofparliament/public-financial-management-act-2016-act-921/> accessed on January 19, 2020.
[10] Stourm, Rene (1917). The Budget. Translated by Thaddeus Plazinski. New York: D. Appleton and the Institute for Government Research
[11] Schiavo-Campo, S. 2007. Chapter 2: ‘The budgeting and its coverage’. In A. Shah (Ed), Budgeting and budgetary institutions (Public Sector Governance and Accountability Series: pp. 53-88). Washington DC: The World Bank
[12] Malgwi, A. A., & Unegbu, A. O. (2012). Budget in Nigerian public sector: Need for balanced scorecard perspective. International Journal of Finance and Accounting, 1(2):1-6.
[13] Ackoff, Russell L. 1979. “Resurrecting the future of operational research.” Journal of the Operational Research Society, 30(3): 189-199.
[14] Pattaro, Anna F. 2016. “Budgetary Principles”. Global Encyclopedia of Public Administration, Public Policy, and Governance, 1-8.
[15] Ministry of Finance (MoF) Ghana. 2015. The Budget Operational Manual for Development of National Budget. Available at https://studydaddy.com/attachment/165976/GHANA+BUDGET+OPERATIONS+MANUAL.pdf. Accessed on September 5, 2020.
[16] Khan, A., & Hildreth, W. B. (2002). Budget Theory in the Public Sector. Greenwood Publishing Group. Available at https://erl.ucc.edu.gh/jspui/bitstream/123456789/2979/1/%5BAman_Khan%2C_W._Bartley_Hildreth%5D_Budget_Theory_in_%28BookZZ.org%29.pdf. Accessed on September 5, 2020.
[17] Neuby, B. L. (1997). “On the lack of a budget theory”. Public Administration Quarterly: 131-142, p. 132.
[18] Hyde, Albert C. 1992. “The Development of Budgeting and Budget Theory: The Threads of Budget Reform.” In A.C. Hyde (ed.), Government Budgeting: Theory, Process, Politics. Pacific Grove, CA: Brooks/Cole Publishing, 1992: 1–6.
[19] IMF. 2014. Government Finance Statistics. International Monetary Fund, 1986. Available https://www.imf.org/external/Pubs/FT/GFS/Manual/2014/gfsfinal.pdf accessed on September 2, 2020.
[20] Ministry of Finance (MoF). 2020. “2020 Budget Estimates of Ministries, Departments and Agencies.” Available at https://www.mofep.gov.gh/publications/budget-estimates/2020. Accessed on September 5, 2020.
[21] Abdulai, Mohammed S. 2020. “Public Financial Management in Ghana: A Move beyond Reforms to Consolidation and Sustainability.” International Journal of Industrial and Manufacturing Engineering. 14 (6): 424-438.
[22] Diamond, J. 2013. “Good Practice Note on Sequencing PFM Reforms.” PEFA. Available at https://blog-pfm.imf.org/files/sequencing-v8 good_practice_note_on_sequencing_pfm_reforms_jack_diamond__january_2013_1.pdf. Accessed on September 5, 2020.
[23] The Republic of Ghana. 2019. Ghana: Voluntary National Review (VNR) Report on the Implementation of the 2030 Agenda for Sustainable Development. Prepared and Presented by the Government of Ghana. Available at https://sustainabledevelopment.un.org/content/documents/23420Ghanas_VNR_report_Final.pdf accessed on September 19, 2020.
[24] Kilpatrick, W. (1936). Classification and measurement of public expenditures. The Annals of the American Academy of Political and Social Science, 183(1), 19-26.
[25] Dupré, J. (2006). Scientific classification. Theory, culture & society, 23(2-3), 30-32.
[26] Hunter, M. H. (1930). The Problem of Classification: Public Expenditures and Revenues. The American Economic Review, 46-53.
[27] IBP. (2016). Guide to the open budget questionnaire: An explanation of the questions and the response options. Available at <https://www.internationalbudget.org/wp-content/uploads/open-budget-survey-2017-guide-and-questionnaire-english.pdf > accessed on January 19, 2020.
[28] OECD. (2008). OECD glossary of statistical terms. Organization for Economic Co-operation and Development. Available at <https://stats.oecd.org/glossary/detail.asp?ID=6152#:~:text=The%20term%20international%20statistical%20standard,organisations%20working%20with%20national%20agencies > accessed on October 24, 2020.
[29] Richard, A., & Daniel, T. (Eds.). (2001). Managing Public Expenditure: A Reference Book for Transition Countries. OECD Publishing.
[30] IMF (2021). IMFx GFSxGovernment Finance Statistics. Available at < https://learning.edx.org/course/course-v1:IMFx+GFSx+1T2021/home> accessed on July 20, 2021.
[31] IBP. (2016). Guide to the open budget questionnaire: An explanation of the questions and the response options. Available at <https://www.internationalbudget.org/wp-content/uploads/open-budgetsurvey-2017-guide-and-questionnaire-english.pdf > accessed on January 19, 2020. accessed on January 19, 2020.
[32] World Bank (2021). World Development Indicators. Available at <Compensation of employees (% of expense) - Ghana | Data (worldbank.org)>
[33] World Bank. (2017). Fiscal consolidation to accelerate growth and support inclusive development: Ghana public expenditure review. World Bank. Available at < https://documents1.worldbank.org/curated/en/972961498157963462/pdf/Ghana-PER-FINAL-June-19-2017.pdf>
[34] World Bank (2021). World Banks Development Indicators. Available at <Subsidies and other transfers (% of expense) - Ghana | Data (worldbank.org)>
[35] Kim, J. M. (Ed.). (2006). From Line-item to Program Budgeting: Global lessons and the Korean case. Korea Institute of Public Finance.
[36] MoF, (2018). Revised PBB Manual. Available at < https://mofep.gov.gh/sites/default/files/news/Revised-PBB%20Manual.pdf> Accessed on January 24, 2022
[37] Robinson, M. (2013). Program Classification for Performance-Based Budgeting. World Bank, Washington, DC. Available at <https://openknowledge.worldbank.org/bitstream/handle/10986/21767/959380PUB0perf00Box391429B00PUBLIC0.pdf?sequence=1> accessed on January 24, 2022
[38] PEMPAL, (2014). Integration of the Budget Classification and Chart of Accounts Good Practice among Treasury Community of Practice Member Countries. Available at < https://www.pempal.org/sites/pempal/files/good_practice_design_of_coa_in_tcop_member-countries_eng.pdf> Accessed on January 24, 2022
[39] IMF Afritac West 2 (2019). Ghana Reviewing and Refining: The Structure and Efficiency of Chart of Accounts.
[40] Biletska N. (2011). Budget classification: Basic PFM training program the World Bank Group. Available at <https://view.officeapps.live.com/op/view.aspx?src=https%3A%2F%2Fweb.worldbank.org%2Farchive%2Fwebsite01531%2FWEB%2FIMAGES%2FBUDGETCL.PPT&wdOrigin=BROWSELINK> Accessed on January 24, 2022
[41] IMF Afritac West 2 (2019). Reorganization of the Controller and Accountant General’s Department and Review of Core Functions.
[42] UN’s Sustainable Development Goals. Available at https://www.imf.org/en/Topics/SDG Accessed on January 24, 2022
[43] AU’s Agenda 2063 Goals. Available at <https://www.facebook.com/Academy2063/photos/did-you-know-that there-are-20-goals-under-agenda2063-if-so-can-you-name-them-we/157973329084398/> Accessed on January 24, 2022
@article{"International Journal of Business, Human and Social Sciences:80854", author = "Mohammed Sani Abdulai", title = "Government of Ghana’s Budget: Its Functions, Coverage, Classification, and Integration with Chart of Accounts", abstract = "Government budgets are the primary instruments for formulating and implementing a country’s fiscal policy objectives, development priorities, and the overall socio-economic aspirations of its people. Thus, in this paper, the author examined the Government of Ghana’s budgets with respect to their functions, coverage, classifications, and integration with the country’s chart of accounts. The author did so by amalgamating the research findings of extant literature with (a) the operational and procedural guidelines underpinning the formulation and execution of the government’s budgets; (b) the recommendations made by various development partners and thinktanks on reforming the country’s budgeting processes and procedures; and (c) the lessons Ghana could learn from the budget reform efforts of other countries. By way of research findings, the paper showed that the Government of Ghana’s budgets in terms of function are both eclectic and multidimensional. On coverage, the paper showed that the country’s budgets duly cover the revenues and expenditures of the general government (i.e., both the central and sub-national governments). Finally, on classifications, the paper noted with delight the Government of Ghana’s effort in providing classificatory codes to both its national development agenda and such international development goals as the AU’s Agenda 2063 and the UN’s Sustainable Development Goals. However, the paper found some significant lapses that require a complete overhaul and structuring on the integrations of its budget classifications with its chart of accounts. Thus, the paper concluded with a detailed examination of the challenges confronting the country’s current chart of accounts and recommendations for addressing them.", keywords = "Budget, budgetary transactions, budgetary governance, Chart of Accounts, classification, composition, coverage, Public Financial Management.", volume = "16", number = "6", pages = "335-20", }
