General News of Fri, 17 Feb 201766
We won't touch Heritage Fund - Ofori-Atta
Finance Minister, Ken Ofori-Atta, has said the Akufo-Addo government has no intention of touching the Heritage Fund to bankroll the Free Senior High School policy.
“We are not going to touch the Heritage Fund to be able to support the free SHS education,” Ofori-Atta told Accra-based Joy FM.
Mr Ofori-Atta’s clarification follows a comment by Senior Minister Yaw Osafo Marfo that the government may rely on the oil kitty to fund the Free SHS policy.
Mr Osafo Marfo stated at a forum in Accra on Tuesday 14 February that: “We have to make an amendment to say that X per cent of the Heritage Fund, or the Petroleum Fund will be used to support second cycle education. If we think that industry requires a certain stimulus that will enable jobs to be created and you are creating a job to build Ghana, you can look at it and put in a certain amount. We are [also] looking at agriculture.”
President Nana Addo Dankwa Akufo-Addo recently assured Ghanaians that his government “will fund the cost of public Senior High Schools for all those who qualify for entry from the 2017/2018 academic year onwards”.
Spelling out the details of the policy, “so that no one in Ghana is left in any doubt”, President Akufo-Addo explained: “By Free SHS, we mean that, in addition to tuition, which is already free, there will be no admission fees, no library fees, no science centre fees, no computer lab fees, no examination fees, no utility fees; there will be free textbooks, free boarding and free meals, and day students will get a meal at school for free.”
The president added: “Free SHS will also cover agricultural, vocational and technical institutions at the high school level. I also want to state clearly again that we have a well thought-out plan that involves the building of new public senior high schools and cluster public senior high schools”.
President Akufo-Addo made this known on Saturday, February 11, 2017, when, as the Special Guest of Honour, he delivered a speech at the 60th anniversary celebration of Okuapeman School.
On Thursday, the Minority in Parliament said it will resist the use of the Fund to fund the programme scheduled to start in September this year.
“We join the overwhelming majority of Ghanaians and civil society groups to register our strongest disapproval and objection to this idea. We wish to state emphatically that we shall resist any attempt to amend the Petroleum Revenue Management Act. …A lot of thinking and consultation was put into this Act which was led by the Finance Ministry. International development partners were consulted and lessons were drawn from the best practices in oil producing countries the world over. The Act is a product of national consensus and has both executive and legislative approvals,” former Deputy Finance Minister Cassiel Ato Forson told journalists on Thursday, 16 February at a press conference organised by the Minority in parliament.
Meanwhile, policy think tank IMANI Africa’s Patrick Stephenson has said Ghana needs about $600 million per annum to fund and implement the Free Senior High School programme introduced by the Akufo-Addo government.
Speaking to Moro Awudu on Class91.3FM’s Executive Breakfast Show on Thursday, 16 February, on the proposed means of funding for the programme, Mr Stephenson said the “total proceeds that we have sitting in the Petroleum Fund now – some rough computation suggest we have a little over $300 million. How much do we need to invest in free education annually? Rough computations suggest something in excess of $600million if we have to do it right and do it well. Now if you decide to go and take the resources out of your Petroleum Fund, clearly it still doesn’t fix your entire financing problem that you need and all of that is gone in just a year. Not that it’s a bad thing in itself, you should be able to demonstrate, for example, that it’s going to be sustainable for the long term and whatever they are putting in there goes in there, but we haven’t heard all of these things.”
The Ghana Heritage Fund was established in 2011 by Section 10 (1) of the Petroleum Revenue Management Act, 2011 (Act 815). It is meant to serve as an endowment for future generations. It is not supposed to be touched until after 15 years of its establishment.
Each year, nine per cent of oil revenue is deposited into the fund. According to figures from the Bank of Ghana, in the first half of 2016, the Heritage Fund received US$5.79 million while the Stabilisation Fund received US$13.52 million.
In the second half of 2016, Heritage Fund received US$6.85 million, while the Ghana Stabilisation Fund received US$15.99 million.
As of December 2016, the Heritage Fund had accrued US$262.57 million, making up eight per cent of total revenue from oil proceeds distributed to the Petroleum Holding Fund (PHF) and the Ghana Petroleum Funds (GPFs).
The Annual Budget Funding Amount (ABFA) received a total of US$1,473.45 million representing 43 percent of the total revenue while the Ghana National Petroleum Corporation (GNPC) received a total amount of US$1,057.30 million equivalent to 31 percent of total revenue.
The Ghana Stabilisation Fund (GSF) received an amount of US$633.87 million (18 per cent).