Strengthening Accountability: Will Ghana’s Independent Value-for-Money Office Deliver Real Change?

By Prof. Samuel Lartey

Introduction

Ghana’s persistent challenges with public financial mismanagement, inflated contracts, and procurement irregularities have long raised concerns among policymakers, civil society organizations, and international partners. In response, the government has proposed the establishment of an Independent Value-for-Money (VfM) Office to enhance transparency and accountability in public spending. The initiative, backed by the Institute of Statistical, Social and Economic Research (ISSER), has been described as “long overdue” by ISSER Director Prof. Peter Quartey. With additional fiscal discipline measures in the 2025 Budget, including stricter auditing of arrears, enforcement of spending ceilings, and amendments to procurement laws, the question remains: will these reforms significantly curb wastage and corruption in public expenditure? And more importantly, how will these reforms impact government initiatives, corporate business operations, households, and the broader Ghanaian economy?

Assessing the Independent Value-for-Money Office

For years, Ghana’s procurement and contract award processes have been marred by allegations of political interference, inflated costs, and poor value for money. High-profile cases such as the $150 million Saglemi housing project, which remains incomplete despite substantial disbursements, highlight the urgency of reforms. The proposed VfM Office aims to introduce an independent mechanism to scrutinize contracts before approval, ensuring they align with market rates and deliver optimal benefits.

However, the success of this initiative will hinge on several factors:

            •           Independence and Political Will

The VfM Office must be insulated from political influence to function effectively. If the appointment of officials and the scope of its mandate are subject to government control, its impact could be significantly weakened.

            •           Institutional Coordination

Ghana already has oversight institutions such as the Auditor-General’s Office and the Public Procurement Authority. The new VfM Office must complement rather than duplicate existing roles, ensuring a streamlined and effective accountability framework.

            •           Public Participation and Transparency

For real change, public contracts must be open to scrutiny from civil society and media organizations. A digital platform providing access to contract details, evaluation reports, and VfM assessments could enhance public trust and participation.

Analyzing the 2025 Budget’s Fiscal Discipline Reforms

Beyond the VfM Office, the 2025 Budget outlines broader reforms aimed at enhancing financial discipline and curbing leakages. Key measures include:

            •           Auditing and Validating Arrears

Ghana has accumulated significant arrears in public sector payments, contributing to fiscal instability. The 2025 Budget proposes a thorough auditing and validation process to ensure genuine obligations are settled while eliminating ghost claims and inflated invoices.

As of 2024, Ghana’s total public debt stands at approximately GHS 658.6 billion (IMF, 2024), with unpaid arrears exacerbating financial distress. A rigorous auditing framework could help rationalize spending and reduce unnecessary obligations.

            •           Enforcing Spending Ceilings

The government plans to impose strict spending limits across ministries, departments, and agencies (MDAs). This measure is designed to prevent excessive expenditure beyond budgetary allocations, which has historically contributed to fiscal slippages.

A similar initiative in 2023 saw the capping of discretionary spending, reducing Ghana’s budget deficit from 9.2% in 2022 to 6.8% in 2023 (Ministry of Finance, 2024). If properly implemented, these ceilings could further consolidate gains in fiscal responsibility.

Amending Procurement Laws

The budget proposes changes to Ghana’s Public Procurement Act to enhance efficiency, transparency, and cost-effectiveness in government procurement processes.

Previous loopholes have enabled sole sourcing and restricted competitive bidding, often inflating contract costs. For instance, a 2022 study by the Ghana Anti-Corruption Coalition found that sole-sourced contracts were, on average, 30-40% more expensive than those awarded through competitive tendering.

Strengthening procurement laws, coupled with digital tracking of contracts, could significantly curb procurement-related corruption.

Impact on Government Initiatives, Businesses, Households, and the Economy

            •           Government Initiatives:

The success of these financial reforms will directly impact government-funded projects in sectors such as infrastructure, health, and education. By reducing procurement inefficiencies and ensuring value for money, resources could be channeled more effectively into delivering essential services. This could lead to improved road networks, better-equipped hospitals, and expanded educational facilities, enhancing national development.

            •           Corporate Business Operations:

The enforcement of spending ceilings and stricter procurement regulations will create a fairer playing field for businesses. Competitive bidding will encourage transparency and allow businesses, especially SMEs, to participate in government contracts without fear of political favoritism. Furthermore, a more predictable public financial environment could boost investor confidence, potentially attracting foreign direct investment (FDI).

            •           Households:

Efficient public financial management has direct benefits for Ghanaian households. When government spending is disciplined, inflationary pressures from excessive borrowing and deficit financing can be mitigated. This could stabilize prices of essential goods and services, improving the cost of living. Additionally, more transparent government procurement means public funds are better utilized for social services, positively affecting the average citizen.

            •           The Economy:

Stronger fiscal discipline is crucial for macroeconomic stability. Reducing arrears, enforcing spending ceilings, and enhancing procurement processes could help Ghana meet its debt sustainability targets, unlocking financial assistance from the IMF and other international bodies. A more disciplined financial regime could also support exchange rate stability and reduce the risk of inflationary shocks, fostering a healthier economic environment.

Will These Measures Curb Corruption and Wastage?

While these reforms appear promising, their effectiveness will depend on rigorous enforcement and systemic change. Lessons from other countries offer a mixed picture:

Rwanda’s establishment of an e-procurement system led to a 30% reduction in public procurement costs (World Bank, 2023), suggesting that technology-driven reforms can yield significant savings.

Conversely, Nigeria’s attempts at enforcing spending ceilings have faced resistance from vested interests, limiting the policy’s impact.

For Ghana, a decisive commitment to implementation, supported by independent oversight, will be crucial. Political will, civil society engagement, and digital innovations in financial management could determine whether these reforms mark a turning point in Ghana’s fight against fiscal mismanagement.

Conclusion

Ghana stands at a crossroads in its battle against public sector inefficiencies and corruption. The proposed Independent Value-for-Money Office, alongside broader fiscal discipline measures in the 2025 Budget, signals a commitment to strengthening oversight and accountability. If successfully implemented, these reforms could improve government service delivery, create a more transparent business environment, stabilize household economic conditions, and drive broader macroeconomic stability. However, without genuine political backing, institutional coordination, and active public scrutiny, these reforms may fall short of their transformative potential. Ghana’s ability to turn these proposals into tangible outcomes will determine the country’s path toward a more efficient, transparent, and financially disciplined governance system—one that truly delivers value for money for its citizens.

Prof. Samuel Lartey
sammylaatey@yahoo.com