Question

Summarize the Public financial Management Act 921 into two pages

Answer 1

Object of this Act

(1) The object of this Act is to regulate the financial management of the public sector within a macroeconomic and fiscal framework.

(2) For the purpose of subsection

(1), there shall be established

(a) a framework to support a sound fiscal policy and the macroeconomic management of public funds;

b) processes for the preparation, approval and management of a transparent, credible and predictable annual budget;

(c) mechanisms for the operation of the Consolidated Fund;

(d) mechanisms for the management of public funds, assets and liabilities;

(e) internal and external audit frameworks and correlative reporting and accounting systems; and

(f) a mechanism to oversee the matters specified under paragraphs

(a) to (e)

.

Application

(1) This Act applies to

(a) a covered entity; and

(b) a public officer responsible for receiving, using, or managing public funds.

(2) This Act shall be read together with any other enactment relevant to public financial management.

(3) Where there is a conflict or inconsistency between the provisions of this Act and any other relevant enactment, the provisions of this Act shall prevail.

Responsibilities and Roles for Public Financial Management

General responsibility

3.The Minister, Chief Director, Controller and Accountant-General, a Principal Account Holder, a Principal Spending Officer and any other public officer designated by the Minister to manage public funds shall discharge their respective responsibilities and exercise their powers in accordance with this Act and the Regulations.

Responsibilities of Minister

(1) The Minister is responsible for the policy and strategic matters related to the efficient operation of the public financial management system of the country subject to policy guidance from Cabinet.

(2) For the purpose of subsection (1) and subject to the Constitution and any other enactment, the Minister shall

(a)prepare the annual and supplementary budget estimates and reports for submission to Parliament;

(b) submit to Parliament for approval, the budget of covered entities as required under this Act or any other enactment to ensure compliance of the covered entities;

(c) monitor and assess the implementation of the annual budget and ensure the implementation of the fiscal policy

of Government;

(d) manage Government property, financial assets, Government debts, Government guarantees and other contingent liabilities specified under this Act;

(e) account for public funds through a consolidated public account;

(f) supervise the financial operations of a covered entity;

(g) prepare Fiscal Strategy Document;

(h) manage public funds;

(i) coordinate and mobilise resources including financial assistance from development partners and integrate the

resources into the planning, budgeting, reporting and accountability processes provided under this Act;

(j) provide policy framework for conducting banking and management of cash for a covered entity;

(k) issue directives and instructions necessary for the effective implementation of this Act or any other enactment to the head of a covered entity, a Principal Account Holder and Principal Spending Officer of a covered entity; and

(l) perform any other functions assigned to the Minister under this Act

Powers of Minister

(1) Pursuant to section 4, the Minister may

(a) request a report or any other information from any covered entity or any other person receiving grants, advances, loans,guarantees or indemnities from the Government;

(b) in consultation with the Civil Service Council and with the approval of Cabinet, establish structures or units, within the Ministry necessary to enable the Minister discharge responsibilities under this Act;

(c) acting on the advice of the Attorney-General and subject to the approval of Parliament, enter into and execute an agree-ment on behalf of the Government in relation to matters of a financial nature; and

(d)give directives and instructions necessary for the implemen-tation of the provisions of this Act.

(2) The Minister may delegate any of the responsibilities under subsection (1) to the Chief Director or to a senior public officer not below the rank of a Director within the Ministry but shall not be relieved of theultimate responsibility for the performance of the delegated responsibility.

(3) Subject to any procurement laws, the Minister may hire or retain the services of professionals, consultants or experts, as the Minister considers necessary for the proper and effective performance of the functions of the Minister under this Act, on the terms and conditions to be agreed upon.

Responsibilities of Chief Director.

(1) In addition to the duties assigned under section 20 of the CivilService Act, 1993 (PNDCL 327) and responsibilities specified under thisAct relating to a Principal Spending Officer, the Chief Director shall

(a)advise the Minister on economic, budgetary, and financial matters and on matters related to the implementation of this Act;

(b) coordinate the preparation of the (i) Fiscal Strategy Document, (ii) budget estimates, and (iii) the Appropriation Bill;

(c)co-ordinate the promotion and enforcement of a transparent,efficient and effective manangement of

(i) public revenue,

(ii) public expenditure, and

(iii) the assets and liabilities of a covered entity;

(d)monitor the performance of the public financial manage-ment systems of the public sector;

(e)monitor the financial and related performance of a covered entity; and

(f) prepare a report within one month after the end of eachquarter on the implementation of the annual budget by theGovernment and submit the report to the Minister.

2) For purposes of subsection (1), the Chief Director

(a) shall through the Controller and Accountant-General have access, during working hours, to

(i) the accounting records or information of a covered entity,

(ii) the place where public accounting services are carried out, and

(iii) the place where public accounting records are kept;and

(b) may inspect, during working hours, the offices of a covered entity and access any information relating to

public finance that the Chief Director may request.

(3) The Chief Director may, under paragraph (b)of subsection (2), authorise a public officer to inspect the offices of a covered entity.

(4) The Chief Director may, in writing, delegate any of the responsibilities under this section to a senior public officer of the Ministry butshall not be relieved of the ultimate responsibility for the discharge of the delegated responsibility.

Duties of a Principal Spending Officer

(1) A Principal Spending Officer of a covered entity shall

(a) ensure the regularity and proper use of money appropriated in that covered entity;

(b)authorise commitments for the covered entity within a ceiling set by the Minister under section 25; and

(c) manage the resources received, held or disposed of by or on account of the covered entity.

(2) A Principal Spending Officer shall, in the exercise of duties under this Act, establish an effective system of risk management, internal control and internal audit in respect of the resources and transactions of a covered entity.

(3) Where a Principal Spending Officer receives a subvention on behalf of another entity, that Principal Spending Officer shall remit the subvention to that other entity in accordance with the approved cash flow plan for the subvention.

(4) A Principal Spending Officer may delegate a function or responsibility specified in this Act to a public officer who is under the control of that Principal Spending Officer but shall not be relieved of the ultimate responsibility for the performance of the delegated function or responsibility.

(5)Where a Principal Spending Officer delegates a function or responsibility under subsection (4), that Principal Spending Officer shall give the directives necessary for the proper exercise or performance ofthat function or responsibility.

Controller and Accountant-General

(1) The President shall, in accordance with article 195 of the Constitution, appoint a Controller and Accountant-General who shall be the Chief Accounting Officer of the Government and the chief advisor to the Minister and Government in matters relating to accountancy.

(2) The terms and conditions of service of a Controller and Accountant-General shall be specified in the letter of appointment and shall be appointed for a term of four years which may be renewed for another term of four years.

(3) The Controller and Accountant-General shall be responsible to the Minister for the custody, safety and integrity of public funds.

(4) The Controller and Accountant-General shall

(a) compile and manage the accounts prepared in relation to public funds;

(b)issue general instructions to a Principal Spending Officer in accordance with this Act and the Regulations;

(c) keep, render and publish statements on public accounts under this Act;

(d)develop efficient accounting systems for a covered entity;

(e)approve accounting instructions of a covered entity;

(f)receive, disburse and provide secure custody for public funds;

(g)on the instructions of the Minister, open an account with the Bank of Ghana and its agents necessary for the deposit of public funds subject to compliance with the Treasury Single Account system established under section 46;

(h)authorise the opening of an account for a covered entity

i)in consultation with the Auditor-General, specify for a covered entity, the accounting standards, policies and the

classification system to be applied in public accounting to ensure that a proper system of accounting operates;

(j)provide accounting officers to covered entities; and

(k)be responsible for the classification and management of value books.

Deputy Controller and Accountant-General

(1) The President shall, in accordance with article 195 of the Constitution, appoint Deputy Controllers and Accountants-General.

(2) A Deputy Controller and Accountant-General shall perform functions assigned by the Controller and Accountant-General.

Budget Office

(1) The Ministry shall have an office known as the Budget Office.

(2) The Budget Office shall be responsible for

(a) the preparation of the annual estimates and Medium-Term Expenditure Framework within the constraints specified in the Government’s Fiscal Strategy Document;

(b) the preparation of the mid-year review and half-yearly budget implementation reports under sections 28 and 34;

(c) advising the Minister through the Chief Director on all matters related to the annual budget, supplementary budget and the Medium Term Expenditure Framework;

(d)advising the Chief Director on matters related to the classification of the budget and systems required to

prepare the budget; and

(e) perform any other function assigned by the Chief Director.

Oversight of Parliament

(1) Subject to the Constitution, Parliament shall provide oversight in respect of

(a)matters relating to budget and finance;

(b)government expenditure;

(c)performance reporting;

(d)post-legislative scrutiny; and

(e)impact of financial policy measures on the economy.

(2) The Speaker of Parliament may assign responsibilities under subsection (1) to a committee of Parliament or an office established by Parliament for that purpose.