It is legal to invest idle funds – Terkper
Government on Monday said it has the backing of the law to invest ideal funds in any securities, excluding government ones, to earn interest.
Speaking at a media briefing in Accra, Finance Minister Seth Terkper said while statutory Funds such as the Ghana Infrastructural Fund (GIIF) are backed by law to invest their monies, he is equally empowered under the Financial Administration Act to invest any idle public money in securities.
The Minister was reacting to a statement made by Dr Mahamudu Bawumia, the running mate of the Flagbearer of the New Patriotic Party, alleging that government had diverted $250 million of the $1.0 billion Eurobond issued last year to the Ghana Infrastructure Investment Fund (GIIF) into a private account in a private bank for election campaigns.
Mr Terkper denied the allegations and explained that GIIF Board lodged the $250 million seed money with a commercial bank in December when a decision was taken to move the money from the Central Bank, where it had been lying idle for two years.
“Consequently, the funds which go into GIFFs Account in any commercial Bank cannot be misapplied for election purposes. Rather, any idle fund will earn interest to support infrastructure development of the country,” he said.
“The Funds of GIIF, as any other statutory Fund are, therefore, not to be co-mingled with central government funds,” he said, adding that the funds invested since December 2015 had yielded an interest of GH₵ 23 million.
Mr Terkper said GIIF has been inaugurated with an acting Chief Executive appointed while the administrative processes for its full operation had begun.
The Minister said the investment of idle funds in the banks to earn interest was one of government strategies to manage the financing of the budget and to explore alternative financing instruments.
He said sourcing of financing from the international capital market was backed by stringent rules and international law and therefore not easy for the money to be diverted for other purposes.
Source: GNA