Government urged to improve budget execution after GH¢35.6bn first-half shortfall

Ghana's Institute for Fiscal Studies says government must bring spending back in line with its approved budget after expenditure fell significantly below target in the first half of 2026.

The Institute for Fiscal Studies (IFS) has urged the government to improve budget execution in the second half of the year after it spent GH¢35.6bn less than programmed in the first six months of 2026.

Government had planned to spend GH¢172.54bn between January and June, but actual expenditure was substantially lower, according to an IFS analysis of the 2026 mid-year budget review.

The think tank says the significant underspending raises concerns about the credibility of the government's budget

and has constrained spending on development projects.

Speaking at an IFS briefing on the mid-year budget review, its Acting Executive Director, Dr Said Boakye, said government needed to ensure that approved spending translated into actual expenditure.

"The considerable underspending in the first half of 2026 relative to budget plan not only undermined the budget's credibility but more importantly it also left much to be

desired in terms of growth and development of the country."

Financing decisions

Dr Boakye also criticised the government's financing decisions during the first half of the year.

He said government accumulated resources in the second fund, despite that not being part of the financing plan approved in the 2026 budget.

According to the IFS, this contributed to difficulties in funding important areas, including capital expenditure and other government payments.

"It is therefore regrettable that the government ignored the financing plan in the budget during the first half of 2026 by accumulating resources in the second fund, something that had not been planned for, creating

complications for spending on important items like capital expenditure and various payments," Dr Boakye said.

The IFS is calling for financing decisions in the second half of the year to remain consistent with the approved budget.

It says government should fully implement expenditure programmes that have already been approved, unless there are significant changes in revenue or financing conditions.

The warning comes as the government seeks to balance fiscal discipline with the need to deliver infrastructure and other development programmes.

For the IFS, ensuring that budgeted resources are actually deployed as planned will be critical to restoring confidence in the budget and supporting economic growth during the remainder of 2026.