June 13, 2012

Parliament on Thursday deferred the approval of supplementary agreement between the government of Ghana and the International Fund for Agricultural Development of an amount of US$9million for the Rural and Agricultural finance programme.

The purpose of the facility is to support the implementation of the Rural and Agricultural finance programme in providing improved and sustainable livelihood to the rural particularly women and vulnerable groups by improving their access to sustainable financial services through enhanced outreach, sustainability and linkages.

To achieve their purpose, the facility will be used to build the capacity of ARB Apex Bank, Rural and Community banks and Rural Micro finance institutions.
Benefits of the programme will accrue directly or indirectly to 125 rural and community banks, 20 other micro finance institutions and at least 30 clients to be trained per annum by the rural and community bank in the micro finance roll out programme.

In 10 years, it is expected that about 62,000 small holder farmers will be actively borrowing for production of value chain commodities supported by government programme/agencies.

However, when the motion was moved by the chairman of the finance committee for parliament, James Kludze Avedzi for the approval of the facility, some members were of the opinion that government should not be borrowing fund to build the capacity of rural banks and rural micro finance institutions since these institutions are essentially private profit making organizations.

The MP of Okere, Hon. Dan Botwe who forcefully made this point wondered why public fund should be used in training coat wearing, fat salary paid staff of rural banks to be trained to give loans to poor farmers.

“It will be wrong for government monies to be used in training these people. Don’t they declare profit at the end of the year to use those money to educate themselves, farmers do not need such training to source for a loan. This is an insult to Ghanaian farmers,” he said.

However, a member of the committee, MP for Bimbila, Dominic Nitiwul urged the House to approve the facility as he contended it will be better for the farmers to be trained to access soft loans from the rural banks than to access loans from banks from the commercial market.

Following the sentiments that was raised, the First Deputy Speaker of Parliament, Doe Adjaho who presided over proceedings urged the leadership of House to hold further consultations on the matter to address the concern and clear the  doubts in the minds of members.

Kwadwo Anim/Ghanamps.gov.gh