Ghana experienced GHS 3.67 billion in losses due to public procurement and administrative irregularities in 2024. This figure includes GHS 2.8 billion from procurement and administrative oversights, plus an additional GHS 871.8 million lost from contract management failures. These losses form part of the GHS 18.42 billion in total public sector financial irregularities reported by the Auditor-General for 2024.
These significant financial leaks, representing a 109% increase from the prior year, highlight deep-seated inefficiencies. Public procurement accounts for an estimated 70% of Ghana's national annual budgets across government ministries, departments, and agencies. The consistent exposure to irregularity, inefficiency, and value leakage in this sector demands immediate attention and systemic reform.
This substantial leakage directly impacts Ghana's economic stability and growth potential. The funds lost could otherwise be invested in critical infrastructure, healthcare, or education. Addressing these procurement deficiencies is crucial for improving public finance management and accelerating national development. Ghana's Public Procurement Act, 2003 (Act 663) and subsequent amendments have not fully stemmed the tide of these financial irregularities.
Dr. Kankson Kpentey, Head of Procurement at GCB Bank PLC, argues for a complete overhaul of Ghana's public procurement system. He made this call in a January 2023 media engagement with Joy Business and expanded on it in a November 2023 policy paper. Dr. Kpentey advocates for a new Government of Ghana Procurement Organisation (GOGPO) that reports directly to Parliament. This new entity would operate alongside a reconstituted and independent Public Procurement Authority.
Implementing these reforms could transform public procurement from a source of leakage into a powerful engine for growth. The proposed blueprint includes an Enhanced Public Procurement Act and a rigorous 'No-Budget-No-Procurement-No-PO-No-Payment' control regime. This regime would be enforced through an Enterprise-wide Resource Planning (EwRP) platform. A Breaches, Sanctions, and Non-Compliance (BSNC) league table with a live performance dashboard would also improve accountability.
These changes are expected to create a more transparent and efficient procurement landscape. Such reforms could significantly reduce financial irregularities and redirect substantial funds towards productive public investments. Decision-makers and financial markets will closely monitor the progress and implementation of these proposed measures. A more efficient procurement system would enhance investor confidence and improve Ghana’s fiscal outlook.
The Auditor-General's reports consistently show widespread issues in public sector financial management. For example, the 2024 report revealed the GHS 18.42 billion in financial irregularities. This included procurement-related losses, which represent a substantial drain on public resources. The proposed reforms aim to address these longstanding issues head-on.
Ghana's development aspirations are hindered by a procurement system not designed for its current scale of public spending. Experts suggest that reforming this architecture is critical for optimal and consistent benefit realisation. The proposed structural changes could unlock significant economic value currently lost to inefficiencies and corruption.
Reforming public procurement is not merely an administrative preference; it is fundamental to how the state functions. Every point of leakage in the procurement process reduces the nation's capacity to deliver essential services and foster economic growth. Successfully implementing these reforms could lead to a substantial five-year GDP growth dividend, turning losses into productive public investment.