For years, budgets were missed on both sides — revenue shortfalls and expenditure overruns that created arrears, debt, and inflation.
The first half of 2026 shows a different pattern. Revenue is close to target. Expenditure is below target. No new arrears. Lower interest costs.
During the period under review, government generated GH¢124.8 billion in revenue and spent GH¢136.9 billion. It saved GH¢6.9 billion on interest payments, while GH¢5.3 billion in arrears were cleared.
Presenting the 2026 Mid-Year Budget in Parliament yesterday, Dr Forson said Ghana's fiscal performance in the first half of the year was the strongest recorded in many years, with revenue broadly on track and expenditure remaining below target for the right reasons.
He stated that fiscal balances exceeded programme targets, the primary surplus outperformed expectations, no new arrears were accumulated, while interest costs continued to decline.
He added that the outcome reflected the administration's resolve to take difficult decisions, implement them consistently and maintain fiscal discipline.
Context
To provide context, the minister said the government generated GH¢124.8 billion in revenue and grants in the first half of 2026, only narrowly missing its target of GH¢126.1 billion by 1.03 per cent.
The performance was driven by taxes on income and property, which amounted to GH¢57.5 billion, against a target of GH¢53.2 billion, exceeding the target by GH¢4.3 billion, largely on the back of stronger company tax receipts.
The improved company tax performance reflected stronger private sector profitability amid falling interest rates and a stable cedi, although lower-than-expected oil revenue partly offset these gains.
On the expenditure side, however, total cash spending at the end of June 2026 stood at GH¢136.9 billion, well below the target of GH¢172.5 billion.
Dr Cassiel Ato Forson, stated that the revenue outturn reflected the resilience of domestic tax mobilisation despite weaker oil receipts.
He explained that upstream oil and gas revenue amounted to GH¢6.3 billion, falling short of the GH¢9.1 billion target, while non-oil non-tax revenue reached GH¢9.8 billion, slightly below the GH¢11.0 billion target.
However, Energy Sector Levy proceeds exceeded expectations, rising to GH¢7.7 billion against a target of GH¢4.2 billion, largely driven by the Energy Debt Recovery Levy, which contributed at least GH¢1 billion every month.
On the expenditure front, compensation of employees totalled GH¢42.9 billion, GH¢2.4 billion below target, reflecting tighter payroll controls and the removal of ghost names and unauthorised allowances.
Interest payments also came in below budget at GH¢21.5 billion against a target of GH¢28.4 billion, generating savings of GH¢6.9 billion in the first half of the year.
Debt service savings
Dr Forson said domestic interest payments amounted to GH¢20.4 billion against a target of GH¢24.6 billion, generating savings of GH¢4.2 billion, while external interest payments stood at GH¢1.1 billion compared with a target of GH¢3.9 billion, resulting in additional savings of GH¢2.8 billion.
He explained that the combined GH¢6.9 billion savings on interest payments were directly attributable to lower debt servicing costs.
“Goods and services expenditure also remained below budget at GH¢6.3 billion against a target of GH¢6.6 billion, while energy sector shortfall payments reached GH¢6.9 billion, below the programmed GH¢8.2 billion,” he said.
Capital spending, arrears
The minister stated that total capital expenditure amounted to GH¢22.2 billion, comprising GH¢19.8 billion in domestically financed projects and GH¢2.4 billion in foreign-financed investments.
On arrears, he stressed that the government did not accumulate any new payables between January and June; it rather cleared GH¢5.3 billion in outstanding obligations.
He added that the government had not incurred expenditure it could not pay for, describing the effectiveness of the commitment authorisation system as unprecedented.
