Government Economic Advisor and former Finance Minister, Seth Terkper, has identified three major recurrent expenditure items that he says are significantly draining Ghana's revenue and hindering infrastructure development.
Speaking on Joy FM's Super Morning Show on Tuesday, 1st July, Mr Terkper noted that compensation payments, interest on loans, and expenditure on goods and services, collectively known as recurrent expenditure, consume nearly 70% of Ghana's total revenue.
He explained that compensation payments refer to the government's wage bill, which includes salaries, allowances, and benefits to public sector workers. "These are payments that are not directly tied to infrastructure development," he said.
On the issue of debt servicing, he clarified: "It's the interest on the loan, not the loan itself." "These are recurring payments the government must make on borrowed funds, and they take up a significant portion of revenue." The third drain, he noted, is the cost of goods and services needed to run government operations.
