Minister of Finance, Dr. Cassiel Ato Forson, has directed all heads of government institutions including Ministries, Departments and Agencies (MDAs) to insist on commencement authorisation from the Ministry of Finance before a contract can be approved by the government. Consistent with the new rules set up in the Public Financial Management Act 2025, as amended, the Minister is confident this directive is a “decisive step to enforce fiscal discipline” and “end the culture of financial recklessness in public administration”.
The Public Financial Management (Amendment) Act, 2025 provides for new fiscal responsibility rules, establish an independent fiscal council to promote budget credibility, macroeconomic stability and fiscal and debt sustainability and consolidate the laws relating to fiscal management in the public sector. It seeks to correct a loophole created in the Fiscal Responsibility Act which was passed in 2018 that did not provide for an establishment of a Fiscal Council. However, in the amended PFMA the consequences for spending beyond budget is not only borne by the Minister of Finance but the principal spending officer of an MDA is personally held accountable.
Dr. Forson noted, “This is not merely a bureaucratic process—it is a legal requirement. Any breach of this directive will attract serious consequences. The Ministry of Finance will no longer carry the weight of fiscal indiscipline alone. If you are a principal spending officer and you violate this directive, you will be held personally accountable.”
The government’s directive to the civil servants on seeking prior approval for contracts took effect on April 3, 2025. The finance minister urged government sector employees to conduct their business with integrity and a deep sense of duty in order that trust can be restored in the public service.
Meanwhile, the minister has directed the heads to work with the Auditor-General in an ongoing audit of the various Ministries. According to him, the government is currently dealing with over GH¢67 billion in arrears across 23 ministries however until a comprehensive audit has been carried out government is not paying a single pesewa to any contractor. He asked the Chief Directors for their full cooperation and complete disclosure and tasked the Auditor-General to verify the validity of claims of commencement warrants.