General News of 2014-05-31

Gov’t spends $176 million oil money unlawfully

The African Centre for Energy Policy (ACEP) has revealed that the current government has spent $176 million which accrued to the Contingency Fund as petroleum revenue from January to May this year without approval from Parliament as required by law.
Speaking to Public Agenda in Accra yesterday, Dr. Mohammed Amin Adam, Executive Director of ACEP, challenged Parliament to probe the unlawful expending of the $176 million from the Contingency Fund. Dr. Amin Adam showed this paper a document that he claimed ACEP sourced from the Bank of Ghana (BoG) to support his assertion that the government actually spent the money.
But he earlier raised the issue at the second day of a two-day a multi-stakeholder workshop on budget transparency and accountability organised by the World Bank, Dr. Joseph Kwadwo Asenso, a top official of the Ministry of Finance, disagreed that the $176 million was spent. Dr. Asenso could, however, provide concrete evidence to prove that the money was not spent. Hence, Dr. Amin Adam’s call for a probe.
According to Dr. Amin Adam, ACEP’s investigations also indicated that the government has used the money in the debt service account for expenditure out of the legally stipulated use. “I want challenge the government to publish the Debt Service Account and the Contingency account,” he stated. He said the withdrawal of funds from the two accounts was a violation of the Petroleum Revenue Management Act, 2011(Act 815) and the 1992 Constitution.
The workshop, which was attended by official officials, senior public servants, Members of Parliament, civil society activists and representatives of development partners, was used to disseminate independent budget analysis products delivered.
Its other objectives were to discuss open budget practices and outline future actions to improve transparency and accountability of budget process in Ghana.
Making a presentation, Dr. Steve Manteaw, Chairperson of Civil Society Platform on Oil and Gas said the Public Interest and Accountability Committee (PIAC) faced some challenges. “It’s been three years already and PIAC is still struggling to chart a path for itself. It is not adequately funded and can’t find the resources to regularly engage its stakeholders. It could not provide the platform to dialogue on spending options as required by the Act. It produces reports that until recently were not acted upon,” Dr. Manteaw said.
He continued: “It appears many important considerations were overlooked in PIAC’s establishment such as: How it is to be funded, which committee in Parliament is to take charge of its reports, and clarifying the reporting mechanism between PIAC’s members and their constituencies.”
He said what was required to ensure transparency and accountability in the petroleum sector was an independent PIAC, which timely meets its responsibility. Dr. Manteaw said the government should respond timely to the findings and recommendations of PIAC while providing a clearly defined funding mechanism for PIAC. He said stakeholders should proactively use PIAC’s reports to exact accountability from duty bearers, adding that a “clearly defined reporting mechanism between PIAC and its constituencies” was necessary.
He observed that though the elaborate disclosure provisions in the PRMA and the reports of PIAC are expected to enhance the demand side of social accountability that had not exactly been the case so far. The reasons for that, he averred, were that the disclosures, including the PIAC reports, are packaged in highly technical language and, therefore, beyond the understanding of many people. Other reasons are the problem with how the reports are organised, and the low-key publicity given the reports, resulting in lack of critical engagement on the reports. The weak feedback to constituencies; and the declining funding for civic engagement which inhibits follow-up advocacy actions also deterred proper accountability.
Dr. Manteaw said the parent law that established PIAC was up for review, and that provided enormous opportunities for addressing the teething challenges confronting the Committee. “It is important that, going forward, due consideration is given to nagging issues such as: How it is to be funded, which committee in parliament is to take charge of its reports, and clarifying the reporting mechanism between PIAC’s members and their constituencies.” Stating that section 60 of Act 815 enjoins the Minister for Finance to make regulations for the effective implementation of the Act, he urged the government to expedite action on the development of the regulations.