News:
Nasir Alfa Mohamed vice chair PIAC
November 7, 2022
Vice chairman of the Public Interest and Accountability Committee (PIAC) Nasir Alfa Mohamed said the Ghana National Petroleum Corporation (GNPC) has now become a “cash cow for each government”.
According to him Parliament should do more scrutiny when it comes to GNPC otherwise, “if you allow it, they would run us all down. It’s more or less a cash cow for each government, if any government comes to power”.
“If you allow GNPC freedom, it will become like the cash cow of the government so parliament will have to put in more stringent measures to ensure that GNPC is on the right course”.
He made this remark on Saturday, November 11, 2022 when PIAC had an engagement with the media to present its semi-annual report in Koforidua.
PIAC is an independent statutory body mandated to promote transparency and accountability in the management and use of petroleum revenue in Ghana.
Chair of the Communications sub-Committee Eric Keyman Defor expressed shock when a member of the Parliamentary Press Corps (PPC) pointed out that the books do not look good. He said it’s news to him because at the time of writing their report, the data provided by GNPC to them which they verify did not give them that indication.
“So I do not know what more parliament has seen but it is parliament that approved the work plan of GNPC, so when GNPC provide us with data on what they have received and how they are spending, we critic and when we make findings we advice parliament”, he said.
And one of the things that they (PIAC) have observed is that GNPC in its revenue projection, it project to recover loans it has given to other government agencies that is impeding their cash flow; they use that to support the projected revenue from the petroleum revenue holding fund. Now, when they get approval, it is turning in that, year in year out they are never able to make those loan recoveries but because the budget is approved or let me say is balanced between projected revenue and expenditure.
Ones it is approved, it means the expenditure side has also been approved. They did not get the revenue, they take the discretion to spend on line items that they prefer, so they are advising parliament to look at that; the projections they make should be critically assessed, it should not be just accepted on the face value because GNPC has submitted before a three year recovery plan saying that, year one they would recover this, year two same and year three same.
They submit this to parliament but when they fail to recover, and then they change the recovery plan and come up with new structure meanwhile expenditures keep going on within the cash they receive.
Mr. Eric Keyman Defor further noted that to be more practical, if GNPC want to build a research center and the cost of the building is stated in it, they expect that if revenue falls, they must adjust their expenditure to meet the revenue on a pro rated bases, but they may chose to do the research centre or something else which they may find not to be a core activity of GNPC.
Again, you may find that because of this short falls they may go for loans to meet the core activities stead of relying on what they were allotted. If we do not embark on these our core activities which are urgent, it will affect us; meanwhile the resources have been applied to a non-urgent matter and now creating room to go and borrow.
He said these things happen because they see how they are practically getting free money on a regular basis; and then they end owing. “Now they are doing prospecting in the Volta basin, and should concentrate on that and stop giving loans to other state institutions”, he pointed out.
Kwaku Sakyi-Danso/Ghanamps.com