PRMA law to be amended to allow govt withdraw funds from Heritage Fund

As part of efforts to control the outbreak of the coronavirus in Ghana, the Government of Ghana is considering amending the Petroleum Revenue Management Act (PRMA) to allow the central authority to withdraw funds from the Ghana Heritage Fund (GHF) to undertake emergency expenditures in periods of national emergency.

The Finance Minister, Ken Ofori Atta made the announcement in Parliament on Monday March, 30, 2020.

He revealed that there is an estimated US$591.1 million in the Ghana Heritage Fund.

He told Parliament that : “I will now update the House on measures Government is proposing to close the fiscal gap. Since we are faced with extraordinary circumstances which require extraordinary measures, we would like to propose the following measures for the consideration and support of the House:

“Lower the cap on the Ghana Stabilisation Fund (GSF) from the current US$300 million to US$100 million in accordance with Section 23 (3) of the Petroleum Revenue Management Act (PRMA). This measure will enable the excess amount in the GSF account over the US$100 million cap to be transferred into the Contingency Fund, consistent with Section 23 (4) of the PRMA.

“The amount transferred into the Contingency Fund will be used to fund the Coronavirus Alleviation Programme (CAP). Through this process, an estimated GH?1,250 million will be transferred into the Contingency Fund to Fund the CAP. Mr. Speaker, we therefore wish to seek approval from this August House for the Finance Minister to use the Funds which will be available in the Contingency Fund to fund the Coronavirus Alleviation Programme.

“Arrange with BOG to defer interest payments on non-marketable instruments estimated at GH?1,222.8 million to 2022 and beyond;

“Adjust expenditures on Goods & Services and Capex downwards by GH?1,248 million; Secure the World Bank DPO of GH?1,716 million; Secure the IMF Rapid Credit Facility of GH?3,145 million; Reduce the proportion of Net Carried and Participating Interest due GNPC from 30% to 15%;

“Amend the PRMA to allow a withdrawal from the Ghana Heritage Fund to undertake emergency expenditures in periods of national emergency. There is an estimated US$591.1 million in the Ghana Heritage Fund.”