Month: January 2023

The Public Accounts Committee has started public hearings on the report of the Auditor-General on the Public Accounts of Ghana- Ministries, Departments and Other Agencies (MDAs) for the year ended 31st December, 2020.

At its first sitting on Monday, January 16, 2023, the Chairman of the Committee, Dr. James Klutse Avedzi and the members of the Committee invited the Deputy Minister of Finance, Abena Osei Asare, Directors from the Finance Ministry and Officials from the Controller and Accountant General’s Department to answer queries cited in the Report of the Auditor-General on the Public Sector Accounts of Ghana (General Government) for the year ended 31st December, 2020.

The Committee also considered the report of the Auditor-General on the Consolidated Statement of the Foreign Exchange Receipts and Payment of the Bank of Ghana for the year ended 31st December, 2020.

Directors and officials from the Bank of Ghana, led by the Governor, Dr. Ernest Addison appeared before the Committee to respond to infractions cited in the Auditor-General’s Reports.

The Deputy Minister of Finance, Abena Osei Asare, hinted that the Ministry of Finance will soon bring before Parliament a comprehensive report covering the entire government expenditure on COVID-19 for consideration. She made this known to the Committee since the Auditor-General’s Report was prepared during the era of the COVID-19 and most MDAs made purchasing they didn’t budget for.

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The Minority in parliament has called on government to suspend the Domestic Debt Exchange program it intends to undertake with the hope of reviving the ailing economy.

The Minority at a press conference on Monday, January 16, 2023 addressed by the Minority Leader Haruna Iddrisu said the programme is already failing following the numerous rejections by various stakeholders. Mr Iddrisu asserts that the suspension is inevitably critical to engage in deeper consultations and allow for greater transparency in the initiation, adoption and acceptance of whatever remedies we collectively may agree to.

In order to save Ghana’s economy the Minority Leader contends that Ghana’s economy is being managed as though it were a private entity but reminded the managers that this is about people’s lives and livelihoods, and investments; adding that even the accompanying legislation on investment in bonds require that 75 percent of it be invested in those government treasuries.

They said the implications of the debt exchange programme has dire consequences on various sectors as follows:
a. Implications on entire financial / banking Sector. Ghana’s financial sector will be severely and adversely impacted by the Domestic Debt Exchange Program. With over GHS 60 billion locked up in government bonds, the non-receipt of any interest this year and paltry sums in subsequent years, will prove the undoing of some banks. In the case of some state-owned banks, as much as 70% of their annual revenue comes from their investments in government bonds. Not paying them any interest in 2023 would effectively sound the death knell to these banks with its attendant consequences on depositors and employees who would have to be laid off. Restructuring domestic debts will undermine the health of the banking system since Capital Adequacy will become a challenge

b. Effects on Pension funds- Pension funds will suffer a significant drop in value especially, Tier 2 and 3 pension payouts will drop further from their already low levels. Tier 1 (SSNIT) reserves will drop in value and SSNIT’s capacity to pay will suffer. Reserves of Insurance companies will fall with implications for benefit payments Effects on individual bondholders- the inclusion of individual bondholders in the Domestic Debt Exchange, contrary to initial assurances from both the President and his finance minister, would all but wipe out Ghana’s middle class and impose harsh suffering on them, their families, and dependents. We now know that the reality is different. What Minister Ofori-Atta announced is different from what is being implemented. Ghanaian individuals have started receiving text messages from their banks. Yesterday, about 1.3 million affected individual bold holders petitioned Parliament for a reversal of the Government’s Debt Exchange Programme. This must be the largest and voluminous petition on a single matter ever presented to Parliament in our country’s history. It is inconceivable to accept that individual bonds will be affected. From the outset, there have been clear inconsistencies in pronouncements and the actual implementation. The haircut is real.
The NPP Nana Addo /Bawumia Government should give us a break!

The Minority notes as follows that:

1. It is obvious that the Domestic Debt Exchange Program will create extreme hardships for millions of Ghanaians and existing financial institutions. It is also quite clear, that it was entirely avoidable had the Akufo-Addo/Bawumia government heeded wise counsel from the opposition and Civil Society on prudent management of our finances and economy.

2. It is obvious that the Akufo-Addo/Bawumia is transferring the responsibility to address the debt burden it has created through reckless borrowing and populist fiscal policies to only innocent Ghanaians and the financial sector. For instance, the 2023 budget projects a primary surplus of only 1% which means that we will be reducing the public debt by only 1% of GDP this year. This also means that not enough expenditure cuts are being made by government at a time when it is almost forcibly asking bondholders to forfeit interests and principal payment due them. We demand further demonstration of responsibility from government through more substantial cuts in non-essential expenditure and a reduction in the humongous size of government.

3. We are at a loss as to why individual pension contributors have not been offered the same exemptions that Tier 1 and 2 contributors have been given. This anomaly must immediately be rectified.

4. The inclusion of individual bondholders in the DDE is the biggest transfer of funds from the pockets of Ghanaians to the government and will leave affected persons, mainly the middle class, impoverished while worsening the plight of the poor. This must immediately be stopped.

5. The Akufo-Addo/Bawumia government is simply imposing an almost 80% tax in present value terms on the savings of Ghanaians and our bank balances without any consultations with affected individuals

6. They are also imposing about 80% tax in present value terms on bank capital and deposits.

The Minority while calling for suspension of the programme also called on all stakeholders for a national dialogue on the State of our economy and debt exchange programme with the view to achieving the most workable and the least punitive steps that protect Ghanaians and households from the disastrous effect of the DDE programme as currently designed.

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Ranking member on the Committee of Trade, Industry and Tourism, Emmanuel Armah-Kofi Buah has said the assertion made in this year’s budget by government for promotion and formulation of partnership with existing and prospective business to expand manufacturing plants is an admission of the failure of the One District One Factory (1D1F) industralisation agenda.

According to him the project has been a complete failure, waste of resources and called on banks providing funding support to the 1D1F policy initiative to confirm the disbursement of allocated amounts by the Ministry of Trade and Industry.

He further called on the NPP led government to account to Ghanaian taxpayers for the failed policy initiative, adding that looking at the time remaining for the party in power with the limited number of factories, the policy is not working.

He asserts that the policy has not made any progress in the quest to moving the country from agro-based economy to an even semi-industralised economy.

Mr. Buah pointed out at a press conference that per research done by the Minority, there has not been even distribution of factories in each district as promised; stating that out of the so called 296 1D1F factories at various stages of implementation, about 76 are in Accra, 54 in Kumasi whiles majority of the factories are existing factories. He also questioned where the massive employments promised under the 1D1F are?

“Can anybody confirm the value addition promised under this programme and how it has contributed to our GDP?”
Furthermore, the Minority questions where the substitutes of imported goods promised under the programme are; and if anybody can point to one product – rice, sugar or even toothpick that we have succeeded in reducing its import as a result of 1D1F.

For the increase in foreign exchange earnings he noted that the least said the better.

Kwaku Sakyi-Danso/Ghanamps.com

Speaker of the Community Parliament, Rt. Hon. Sidie Mohammed Tunis has said green hydrogen will go a long way in curbing the adverse effects of climate change.

According to him, to boost access to energy, there is the need to achieve a sustainable renewable electricity generation hence the world needs to promote international cooperation and collaboration around access to technology knowledge and capital.

“We need healthy partnerships and mutual cooperation to promote investments in the sector, which cannot be left to the Executives alone”.

He was addressing the thirteenth session of the International Renewable Energy Agency (IRENA) Assembly – 2023 and IRENA Legislators Forum on the theme “Ensuring a more sustainable energy transition through international co-operation – National Strategies on Green Hydrogen”.

Dr. Tunis drew the attention to the responsibility Legislators have to protect their populations, understanding fully that no one nation can claim supremacy in this fight. This will be achieved through the quality of laid down frameworks and blueprints needed to guide cooperation, partnerships, investments, and application of relevant technologies around the world.

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Speaker of the Economic Community of West African States (ECOWAS) Parliament Rt. Hon Dr. Sidie Mohamed Tunis has departed for Abu Dhabi, UAE, to participate in programs marking the 3rd @ World Energy Transition Day, which will be celebrated under the overarching theme, ‘World Energy Transition – The Global Stocktake’.

During the event, Dr. Tunis is expected to deliver a Keynote Address at the Thirteenth Session of the International Renewable Energy Agency (IRENA) Assembly -2023 and IRENA Legislators Forum on the theme “Ensuring a more sustainable energy transition through international co-operation – National Strategies on Green Hydrogen”.

The session of the Assembly and related meetings will gather global leaders and energy decision-makers to take stock of operational plans and policies, and highlight the concerted action undertaken to implement the energy transition across countries, regions, and the world.

Additionally, the Honorable Speaker will also be making significant interventions at a Public-Private Dialogue on the theme “Towards Just and Inclusive Energy Transitions: Social Dialogue, Skills, and Decent Jobs for All”.

The Dialogue will convene governments, labour unions, and the private sector to share their perspectives and discuss what a just energy transition means in practice. Stakeholders are also expected to exchange views on best practices and lessons learned in ongoing efforts towards just and inclusive transitions and identify further cooperation and outline key challenges and concrete actions to address them.

Both events are holding on 13th January 2023 at the St. Regis Hotel, Saadiyat Island, Abu Dhabi.

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