“The 2021 budget’s recent policy pivot towards fiscal consolidation is an important step in the right direction and a difficult one in a pandemic,” he said. “Government interventions in 2020 also exacerbated pre-existing fiscal rigidities and public debt vulnerabilities. Public debt rose to 78 percent of GDP in 2020, from 64.4 percent in 2019, including ESLA of GHs7.63 billion in 2020. Fiscal consolidation should be deepened and anchored around debt and debt service reduction to create space for social, health, and development spending. “Given the social and equity implications, fiscal consolidation should rely more on progressive revenue and spending measures, while guaranteeing fiscal support to the most vulnerable and social safety nets.
