Gov’t to begin public sector recruitment despite admitting GH¢17bn salary borrowing in 2025

The government has officially given the green light for new recruitments into the public service, Finance Minister Dr. Cassiel Ato Forson has confirmed, even as he revealed that the state had to borrow a staggering GHS 17 billion to pay salaries in the previous year.

Speaking at a dialogue with President John Mahama on Monday, March 17, Dr. Forson stated that the recruitment exercise is a direct fulfillment of a commitment made to Organized Labour, but he stressed that it would be carried out “within budget constraints.”

“In line with the 9th November 2025 agreement on the 2026 base pay, government committed to engage with unions… and undertake critical recruitment into the public service, all within budget constraints,” Dr. Forson explained. “In this regard, government has commenced processes for the recruitment of staff into the public service.”

The Fiscal Reality: A GHS 17 Billion Gap

The announcement comes against a backdrop of significant strain on the public purse. The Minister revealed that the total compensation of employees (wages and salaries) for 2025 amounted to GHS 78.9 billion.

He detailed that this figure surpassed the non-oil tax revenue remaining after the deduction of statutory funds and debt servicing by a substantial margin, creating a shortfall of GHS 17 billion. This deficit, according to Dr. Forson, had to be covered through borrowing.

Further highlighting the fiscal pressure, the Minister noted that Ghana’s compensation-to-tax revenue ratio currently stands at 44 per cent. This is significantly higher than the 35 per cent threshold set by the Economic Community of West African States (ECOWAS), signaling that a large portion of state revenue is consumed by the wage bill.

Balancing Commitments and Constraints

While acknowledging the high wage bill, Dr. Forson reassured stakeholders that the new recruitments would not be allowed to worsen the fiscal situation uncontrollably, emphasizing that the process would be managed within existing budget limits. The government’s ability to balance this staffing push with the need for fiscal consolidation will be closely watched in the coming months.